Budget 2011: Rs 12,000 cr boost likely for plan to revamp cities

NEW DELHI: The government’s urban renewal mission, aimed at revamping cities’ decaying infrastructure, is expected to get Rs 12,000 crore plan support for the next fiscal (2011-12).

Though it was decided to increase the fund, the urban development ministry could utilise only around 50% of the Rs 11,000 crore allocated for the current fiscal. An official said, poor utilisation of fund was due to cities and state governments’ reluctance to implement the reforms.

Jawaharlal Nehru National Urban Renewal Mission ( JNNURM) was launched in 2005 as UPA’s flagship initiative to modernize the cities. The scheme was aimed at initiating reforms and doing away with certain archaic regulations that dominate urban governance.
The moderate hike, if compared with allocation for the current fiscal, came after finance minister Pranab Mukherjee had hinted at budgetary constraints, asking cities and states to raise their own resources and fulfil their promises on reforms.

“People will have to be ready to pay. State and urban local bodies will have to create an enabling environment for public-private partnerships to enter this sector,” Mukherjee had said.

The urban development ministry is under pressure as urban authorities are demanding more funds for ongoing infrastructure projects while showing reluctance to initiate reforms.

“Many state governments had even rolled back reforms after receiving funds from the ministry,” claimed a senior official.

Under JNNURM, the states get Central assistance for urban infrastructure projects only if they carry out major policy reforms like rationalisation of stamp duty, repeal of urban land ceiling acts, e-governance, municipal accounting, property tax, community participation law, public disclosure law, among others.