Civic body is known for its massive fixed deposits which make it richest in country; absence of sustained income sources, massive projects in city bring amount down
One of the chief expenditures of the civic body is the Coastal Road project. File pic
In just a year, the Brihanmumbai Municipal Corporation’s (BMC) fixed deposits (FD) have shrunk by almost Rs 4,000 crore, having come down to Rs 88,000 crore at the end of January 2023. Last year, the corporation had earned a massive income through development premiums, increasing its FD amount by a whopping 18 per cent.
BMC’s FDs have always enjoyed the spotlight, making it the richest civic corporation in the country. However, in the absence of a sustained income source and amid big-ticket projects like the Coastal Road and road concretisation, the FDs have shrunk massively.
BMC’s FDs saw a massive jump in 2021-22 when the state government slashed the premium of buildings by 50 per cent. The BMC earned around Rs 14,500 crore, much more than the estimated Rs 2,000 crore that year. This increased the FD amount from Rs 79,000 crore at the end of March 2021 to more than Rs 92,000 crore in January, 2022.
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The FD amount fell to Rs 89,353 crore at the end of September 2022, and now stands at approximately Rs 88,000. “The BMC transferred Rs 2,500 crore to MSRDC as their legal share of premium in 2022. Besides, the increase due to the slashing of premium charges was only a one-time income,” said a senior BMC official. He added that the BMC had a surplus amount last year, which was kept in FDs and that they are only a way for the civic body to manage the expenses of big projects.
The BMC chief presented a Rs 45,949 crore budget for 2022-23 with the help of Rs 30,743 crore in revenue from various sources and internal loans of Rs 14,704 crore. The internal loans are taken from the FDs. This means the BMC uses the amount from FDs over and above the income from the other revenue sources.
Shifting FD amounts
March 2021: Rs 78,745 crore
January 2022: Rs 92,636 crore
January 2023: Rs 88,000 crore