Delhi’s special status means Rs300 crore in grant losses

Delhi’s special status means Rs300 crore in grant losses
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First Published: Mon, Feb 05 2007. 10 47 AM IST
Updated: Mon, Feb 05 2007. 10 47 AM IST
Thanks to its situation as the nation’s capital as well as a city-state, Delhi is finding that it is losing out on government grants to finance civic infrastructure.
To get money under the Jawaharlal Nehru National Urban Renewal Mission cities are required to have an elected municipal council. Delhi doesn’t meet this requirement. Although the city is administered by the state legislature, most municipal functions are administered by the Municipal Corporation of Delhi, an autonomous agency under the Union ministry of urban development. In Delhi’s case, the city stands to lose approximately Rs300 crore in grants that have been allocated to it for this fiscal alone.
“This requirement is illogical and counter-productive,” says one former urban development official with the Delhi government who did not want to be named because of political sensitivities.
Recognizing that the issue of local self government could be a “major pressure point”, Ramesh Ramanathan, national technical advisor for the Mission, said the government realizes it needs to work out an acceptable solution.
The requirement of an elected municipal council is part of an agreement that cities are required to sign to avail grants of between 30-90% of costs for projects approved by the central government under the mission.
The scheme was set up in 2005 with a corpus of Rs50,000 crore to provide grants for urban development projects in India. Government grants for approved projects could range from 35% of the cost to as much as 90%, depending on the size of the city. The government has already cleared projects worth Rs10,290 crore under the mission.
It isn’t just Delhi that feels discriminated for no fault of its own. Tata Iron and Steel Company (Tisco), which administers a 64-sq km portion of Jamshedpur, through a special trust set up for the purpose, had in August 2006 written to the union ministry asking for it to be exempted from the requirement as well.
There has been no response from the ministry yet, Tata officials confirmed. Meanwhile, the company has also initiated legal proceedings requesting the Supreme Court to recognize Jamshedpur as an industrial township, so it wouldn’t need an elected municipal corporation.
“We are spending over Rs100 crore per year in administering the city, and providing facilities that a municipal corporation would,” says A. N. Singh, chairman,Jamshedpur Utilities and Services Co. Ltd., which administers the city.
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First Published: Mon, Feb 05 2007. 10 47 AM IST