Datanomics: Civic bodies cry for funds as cities' infra crumbles amid rains

Even as capital expenditure of all municipalities in India constituted 60 per cent of its total expenditure in the past four years, it was constrained by the available resources

The India Meteorological Department has forecasted normal to above normal rainfall during the monsoon season across India barring parts of Bihar and the northeast. However,  even pre-monsoon showers have exposed infrastructure bottlenecks of urban cities in parts of Mumbai, Pune, Bangalore, and Delhi among other areas of the country.

 

Prime minister Narendra Modi in his recent address in Gujarat said: “Cities must function as dynamic centers for economic activity, and municipal bodies must actively plan for their transformation”.

 

The appalling financial conditions of municipalities come to highlight when we examine finance of these urban local bodies.  

   

Municipalities’ capex remains sub-1% for past 5 yrs

 

Even as the capital expenditure (capex) of all municipalities in India constituted 60 per cent of its total expenditure in the past four years, it was constrained by the available resources.  The capex remained sub-one per cent of the country’s economic size in the past five years.  Transfers from the Centre and respective states were more than each of their own tax revenues and own non-tax revenues of these bodies.

 

 

Maha civic bodies are better off in terms of capex

 

Of the four states where metropolitan cities – Mumbai, Chennai, Kolkata, and New Delhi – are situated,  municipalities in Maharashtra have been incurring capex in excess of two per cent of the gross state domestic product (GSDP) for the past five years. Even there, parts of Mumbai could not bear the brunt of rains recently despite having the richest municipality of the country.  Municipalities in the rest of the three states spent capex at sub-one per cent of their state’s GSDP.