With nearly 15 cities of the country contributing over 50% of the country’s GDP, the focus is on improving audit quality of Urban Local Governments (ULGs) as these cities could add 1.5% more annual GDP growth, Comptroller and Auditor General (CAG) of India K Sanjay Murthy said on Friday.
Addressing state finance secretaries here, he said CAG will lay special audit focus on 100 cities with a population greater than 0.5 million.
Economic imperative: Why cities are crucial for GDP growth
“Audit of ULBs & PRIs is another important area which we cannot ignore, as nearly 15 cities of the country contribute over 50% of the country’s GDP and Cities like Mumbai, Delhi, Bengaluru, Chennai, and Hyderabad contribute about 30% of GDP and these cities could add 1.5% more annual GDP growth,” Murthy said.
In the budget for 2025-26, the Centre has announced provisions for an Urban Challenge Fund (UCF) of Rs 1 lakh crore aimed at transforming cities into economic hubs by improving infrastructure and promoting sustainable development.
Despite the enhanced funding, the cities still face issues such as pollution, traffic jams, slums, water shortages and poor digital infrastructure.
Beyond audit: A shift to proactive city financial management
“Therefore, our combined efforts should be directed towards – how we can shift from accounting to City Financial Management by data-driven decision making for a vibrant future of our cities,” he said.
The focus would be to evaluate the progress made by these cities vis-à-vis the availability of core infrastructure, such as a reliable supply of essential services like water, electricity, and sanitation. Secondly, stress will be governed to a sustainable environment, like creating a clean and green urban landscape, developing green spaces, promoting renewable energy and building sustainable transportation systems. Other areas of focus would be improving the living standards of citizens by providing better services and amenities and fostering a conducive environment for job creation and investment, he added.