The government is considering market borrowings to incentivise speedy execution of urban infrastructure projects under various new urban missions launched over the last two years, such as Smart Cities and Housing for All, minister of housing and urban affairs Hardeep Singh Puri said on Friday.
“To overcome the severe infrastructure deficit accumulated over long years, huge order of investments is required. To meet various contingencies and to ensure fund availability to meet the targets under new urban missions, we are thinking of mobilising resources from the market…Once this idea is firmed up, we will take it forward in an appropriate manner,” Puri said at an event organised by the Public Affairs forum of India.
The government is committed to extend central assistance of Rs 50,000 crore under the Atal Mission and Rs 48,000 crore under the Smart City Mission until 2019-2020 and in the range of Rs 1 lakh to over Rs 2.5 lakh per each affordable house to be built until 2022. Even with the conservative projection of requiring to build over over one crore houses by 2022 under Pradhan Mantri Awas Yojana (Urban), internal assessment is that central assistance to the tune of about Rs 1.80 lakh crore will be required to be provided, Puri noted, adding Central assistance released so far is about Rs 11,000 crore under the housing mission and about Rs 10,000 crore each under the Smart City Mission and Atal Mission.
The minister, however, did not specify the amount the government was looking to mobilise from the market.
The minister said that within a year-and-a-half of the announcement of the first batch of 20 smart cities, 2700 projects are at various stages of implementation involving an investment of about Rs 1.30 lakh crore.
The first batch of 20 smart cities was announced on January 28 in 2016. A total of 90 cities have since been announced for financing implementation of smart city plans with a total investment of Rs 1.91 lakh crore. “I would like to assure you that tangible gains on the ground will be seen in the next few months,” he said.
Puri said that under the Atal Mission for Rejuvenation and Urban Transformation (AMRUT), elaborate action plans for 500 mission cities have been approved, three years ahead of time.
He also said that about 1.39 core urban households will be provided with water connections and sewarage networks will be improved from the present 30% to 60%, besides developing 1,900 open spaces and green parks.
Underlining that 340 cities, out of 500 selected for AMRUT, have got the credit ratings to enable them issue municipal bonds to mobile resources, Puri said. Pune has already mobilised Rs 200 crore through the bonds and “a few more cities are set to do so,” he said.
Garbage issues in Delhi
The minister also said that a Rs 300 crore garbage management plan has been approved for Delhi. Each of the three municipal corporations in the national capital — North, South and East Municipal Corporations of Delhi — will receive Rs 100 crore from the urban development fund to immediately improve garbage handling capacity.
“The money will go towards procurement of decentralised plants, composting units, and vehicles and sorting machines. This will all be done by December. So, the residents of the national capital will start to get some relief soon,” Puri said.