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Union Minister for Urban Development, Shri Ghulam Nabi Azad has said that in order to strengthen urban infrastructure, government is planning to merge centrally sponsored schemes of Infrastructure Development in Mega Cities and Integrated Development of Small and Medium Towns (IDSMT) under one umbrella and extend its coverage to all the towns and cities of the country as per 2001 census. “The unified scheme will push forward the urban reforms agenda of the ministry and state government desirous of accessing funds under the scheme will have to enter into a Memorandum of Agreement with the centre”, he added. Shri Azad was addressing the delegates at the City Scapes – 2004: Global Convention on Agenda for Urban Infrastructure Reforms organized by FICCI, here today.
The Minister said that the new scheme would help incentivize preparations of DPRs, capacity building, bringing in project efficiency and adoption of innovative and proven technology. He also said that similar scheme exclusively for water supply and sanitation is under consideration. “In order to have alternate sources of funding , urban development ministry is considering a scheme to enhance bankability of projects undertaken by Urban Local Bodies and allow them to access capital market”, he added. Shri Azad also said that to provide an additional incentive for Urban Local Body to become credit worthy and invest in urban infrastructure, a provision has been made for issue of tax free municipal bond up to Rs. 300 crores during this financial year. So far 8 city governments have accessed capital market to raise funds for urban infrastructure by issue of tax-free municipal bond and together have raised Rs. 532 crores from debt market” he added. The Minister also observed that accessing capital market by cities has brought about a perceptible change in the mindset of policy makers/city managers and now there is a consensus on the need for structuring commercially viable/bankable projects that could facilitate development of long term debt market in India.
Shri Azad urged state governments to adopt Urban Land (Ceiling and Regulation) Repeal Act 1999 and amend Rent Laws to remove the hindrances in urban development process. He also emphasized the need to focus on Stamp Duty and Registration Act.
Secretary in the Ministry of Urban Development, Shri Anil Baijal observed that the operation and maintenance of urban services is not satisfactory and hence the government is planning to link additional central assistance for maintenance of assets created with commitment to urban reforms. He said that 35 to 40 towns will be identified for intensive support provided reforms agenda is accepted. He advised state governments to address issues like titles over land, Rent Control Act, Urban Land Ceiling Act, legislation for public private participation so that urban reforms can be unleashed.
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