Smart cities won’t affect powers of municipal corporations: CM

Staff Reporter
Refuting all the allegations of the Opposition point-by-point, Chief Minister Devendra Fadnavis assured the Legislative Assembly that Smart Cities project would not affect the powers of municipal corporations in the State. “Smart cities project is aimed at delivering efficient services to the last man,” he said.
Fadnavis, who also holds the portfolio of Urban Development, was replying to a discussion on supplementary demands, in the Assembly on Monday. During the discussion, former Chief Minister Prithviraj Chavan (Congress) alleged that the State Government had ‘tweaked’ the norms of the Centre as far as Smart Cities project is concerned. He also alleged that formation of Special Purpose Vehicle (SPV) company would affect the autonomy of municipal corporations, and that the State had changed the list of cities shortlisted for the project with ‘political intention’. Sunil Prabhu (Shiv Sena) also raised certain points.
In his reply, Fadnavis elaborated on the norms for the Smart Cities project, aims and objectives, method and manner of implementation etc. He strongly refuted the charges that the norms were ‘tweaked’. “Cities could not be selected for Smart Cities project on the basis of merely static parameters prescribed by the Centre. The situation and requirements differed from city to city. Hence, the State appointed a committee and prescribed dynamic parameters. With a blend of static and dynamic parameters, the State shortlisted cities to be recommended to the Centre for inclusion in Smart Cities project,” he explained.
Stating that urbanisation had remained a neglected area in planning process for a long time, Fadnavis said that the neglect had resulted in cities becoming filthy. Agriculture sector contributed 11 per cent to Gross State Domestic Product (GSDP) of the State, but had burden of 50 per cent employment dependence. In contrast, cities contributed up to 65 per cent to the GSDP. “Smart Cities initiative is to ensure that there is sustainable development in cities, and effective services are provided to the last man. Through this initiative, cities could be made more liveable, safe, vibrant,” he said.
As far as SPV company is concerned, Fadnavis said that municipal corporations were financially stressed and did not have enough funds to contribute as their share in implementation of Smart Cities project. Financial condition reflected on slide in ratings of these municipal corporations, and this ultimately affected their capacity to borrow for developmental projects. Hence, the provision of SPV was include as it would help improve the financial ratings by way of various initiatives including land monetisation, inviting investment from private parties, etc. “However, forming SPV is not mandatory. If a municipal corporation can manage without SPV, and on the basis of public-private partnership, it is free to do so. There is no issue of encroaching upon the autonomy of municipal corporations,” he added.
Taking a dig at the Opposition leaders, Chief Minister said that they were objecting to initiatives like formation of SPV or public-private partnership started during their tenure as ruling side. Still, he said, he was open to discussing finer points regarding Smart Cities project with all the parties, and to accomodating the valid suggestions. He informed the Assembly that he had talked to Shiv Sena chief Uddhav Thackeray, MNS chief Raj Thackeray, NCP senior leader Ajit Pawar and others. In fact, after convincing, Pune Municipal Corporation also had given approval to proposal for inclusion in Smart Cities project.

Revolving fund to provide cheaper loans to ULBs
During his reply, Chief Minister Devendra Fadnavis announced that the State Government was planning to set up a revolving fund with Mumbai Metropolitan Region Development Authority (MMRDA) and CIDCO so as to provide cheaper loans to Urban Local Bodies (ULBs) having low equity. “Many municipal corporations cannot afford to borrow at high interest rates, and this results in problems with repayment. Ultimately, it affects the ratings and developmental project finance of ULBs. Providing borrowings at cheaper rate of interest is one solution to resolve the issue and hence the Government is planning to set up a revolving fund,” he said. 

(14-12-15)