Govt identifying municipalities which can issue bonds: Nath

"We have assigned an agency to look at which municipal corporations are bankable... Which in the short term will be able to issue municipal bonds," he said at a workshop on urban water supply and sanitation here.

"Municipal bonds all over the world have a huge capital market but in India these have just not been used," he said.

The Urban Development minister also suggested that apart from raising funds by issuing bonds, municipalities could also raise financial resources by leveraging assets like unused land.

Nath said the country was urbanising rapidly and warned that the infrastructure gap would widen if timely steps were not taken.

 

"In India there is a huge urban infrastructure deficit and our population has increased from 285 million in large urban areas in 2001 to 400 million in 2011. In the next 15 years it is likely to grow up to 600 million," he said.

"For the first time the growth of the urban population is more than the rural growth. In the next decade there would be more than 70 cities with a population of million. This (infrastructure) deficit that we have, unless we act now, will only increase," Nath said

The urban development minister said investment and capital expenditure in urban infrastructure need to be supported by urban governance reforms.

"How do we have the right governance in our large and small municipalities? This will be an important challenge which we are going to face," he said.

Nath also said states must have a dedicated municipal cadre for the next phase of Jawaharlal Nehru National Urban Renewal Mission (JNNURM).