NMC needs Rs 500 to tide over crisis but gets Rs 150 crore only from State Govt

Nagpur: As against the demand of cash-starved Nagpur Municipal Corporation (NMC), the State Government has released Rs 150 crore as special grant to the civic body to tide over the financial crisis. The funds are likely to be used for releasing stalled payments of ongoing developmental works in the city and clearing bills of agitating contractors. The Rs 150 crore relief evoked mixed response with some terming the fund as peanuts against the demand of Rs 500 crore that could have brought the financial position on the right track.

With mounting obligations, the cash-strapped civic body administration developed cold feet in meeting the committed expenditure including salaries, pension grants, electricity, raw water bill, payment to Orange City Water, petrol, diesel, telephone bills, security, repayment of loan, garbage lifting, etc.

The NMC contractors have been agitating for more than a week demanding their dues which are pending since March 2018. The civic body has also to make its contribution towards development works as well as to maintain public transport system efficiently.


The cash crunch situation came to such a pass mainly due to haphazard planning and exorbitant budgetary provisions without giving a thought to revenue recovery scenario. This year too, highly lucrative Budget was presented. The provisions made for various heads have been exhausted. No tenders are being floated nor work orders are being issued. Obligations on various counts have touched to over Rs 500 crore. Half of the amount is due to the contractors.

After receiving the special grant of Rs 150 crore from State Government, the NMC coffers would have Rs 250 crore at its disposal. With this amount, the NMC administration will have to do a balancing act in distribution of pending dues. Moreover, the civic body has also to fulfil development assurances as currently the NMC is constructing cement roads, over bridges and other development works.

NMC does not have its own resources to continue with the development work at this pace. Most importantly, salaries of employees and pension grants have to be distributed before Deepawali. The Finance Department of NMC had suggested that the local body should request State Government to release a special grant of Rs 500 crore in view of financial crisis.