World’s richest municipality gets richer: has Rs 92,000 crore FDs now

18% increase comes after building premiums reduced by half

geetanjali

Geetanjali Minhas | March 2, 2022 | Mumbai


#Mumbai   #BMC   #urban governance   #pandemic  


In a bonanza of sorts, the Brihanmumbai Municipal Corporation fixed deposits have jumped from Rs 78,000 crore to over Rs 92,000 crore during in eight months.

The 18% growth in the FD kitty has come after the state government reduced building premiums by 50%. In financial year 2021-22 BMC estimated Rs 27,811 crore income including Rs 2,000 crore from the development plan. But after the state government of Maharashtra slashed the premium to half, BMC earned an income of Rs 13,543 crore till January 2022 and expected to earn another Rs 1,207 crore by the end of the current financial year. This has resulted in an estimated increase in income from Rs 27,811 crore to Rs 37,538 crore within the current financial year.

Going back, at the end of 2011-12, the BMC had reserves of Rs 26876 crore in FDs. Within the next six years the FD amount increased to Rs 72,000 crore and thereafter remained stagnant due to gradual decrease of income sources like property tax, premium on development work as well as BMC’s infrastructure projects including Coastal Road, construction of roads and bridges among others.

In 2020-2021 due to pandemic, as income reduced for the civic body there was no increase in FD amount and for the first time in a decade the amount reduced by around Rs 450 crore. However, on account of reduction in premiums, by December-end in the current fiscal, the FD amount increased to Rs 87,131 crore and added another Rs 5,504 crore in January to the kitty, thereby increasing the total FD amount over Rs 92,000 by the end of the month. With another month for the financial year to close, the FD has already registered an 18% growth.

BMC Fixed deposits (in Cr)

March 2018: Rs 72,000
March 2019: Rs 76,579
March 2020: Rs 79,116
March 2021: Rs 78,745
January 2022: Rs 92,636

“Due to 50% reduction in premiums charged on building proposals between March 21 to December 21, BMC has a windfall of nearly Rs 14,000 crore of additional income during the last 11 months (due to increase in volumes wherein 2,860 new construction projects got approved – most of which were non-viable with full premiums) resulting in unprecedented jump in BMC reserves from Rs 78,000 crore to nearly Rs 93,000 crore now. A real win-win situation where the real estate sector (the backbone of Mumbai) is on fast track now (despite last two years of Covid pandemic) resulting in tremendous boost in employment in this sector for the next three years at least,” said municipal commissioner IS Chahal.

 

Comments

 

Other News

PM Modi leaves for G7 Summit in Italy

In his first foreign visit after taking oath of office for the third time, prime minister Narendra Modi Thursday evening left for Italy to participate in the G7 Outreach Summit. “At the invitation of Prime Minister Giorgia Meloni, I am travelling to Apulia region in Italy to participat

Some market talk, some gossip – learnings over tea at RBI

A Fly on the RBI Wall: An Insider’s View of the Central Bank By Alpana Killawala Rupa Publications, 248 pages, Rs 595  

Coalition politics not expected to impact India’s foreign policy

Prime minister Narendra Modi has strived incessantly to bring laurels and much needed recognition for the nation since May 2014 when he was sworn in as the head of state. The poser which can be deliberated upon is this: What will be the consequential impact of the new era of coalition politics which confro

New govt`s first decision pushes for farmer welfare

The BJP-led NDA government has started its term with its first decision relating to farmer welfare. Narendra Modi took charge of office as prime minister of India for the third time on Monday, a day after he and his colleagues were sworn in by the president of India. In his fi

Narendra Modi takes oath for third term

Narendra Modi made history Sunday evening as he was sworn in by president Droupadi Murmu for a third successive term. Modi thus becomes the first prime minister since Jawaharlal Nehru to have comptered two full terms and beginning a third consecutive term. In the swearing-in c

Modi appointed PM for the third time

Narendra Modi was Friday appointed the prime minister for a historic third time, as president Droupadi Murmu invited him to form the next government. The swearing-in ceremony for the new council of ministers will take place on Sunday. “The President, having satisfied herself on the bas

Visionary Talk: Amitabh Gupta, Pune Police Commissioner with Kailashnath Adhikari, MD, Governance Now


Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter