MMRDA will use Rs 1,300 cr from its reserve fund to meet infrastructure expenditure
The Mumbai Metropolitan Regional Development Authority (MMRDA), which carries out expensive infrastructure projects in Mumbai including the metro, will use Rs 1,300 crore from its reserve fund to cover expenses incurred on some of the ongoing projects .
A proposal to use Rs 1,300 crore from the reserve fund was approved at a recent MMRDA meeting.
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Officials said the reserve fund was made up of the fund’s corpus interest collected from the proceeds of the sale of land at Bharat Diamond Market in January 1992.
As of January 2022, the reserve fund account had a balance of Rs 1392.24 crore after accrued interest.
While the fund is granted in the form of loans to municipalities, local organizations and other government agencies for the implementation of road and transport projects, the accrued interest becomes a source of income for MMRDA.
“Given the current financial situation of MMRDA, as it does not have funds for expenses incurred on ongoing projects… the proposal has been put forward to use the contingency fund. As a result, Rs 1,300 crore from the reserve fund was allowed to be credited to MMRDA. This amount will be used to complete ongoing projects and serve as capital to start new projects,” an official said.
MMRDA, a special planning authority, is currently carrying out major infrastructure projects worth Rs 1 lakh crore in the Mumbai metropolitan area, including Mumbai Metro, Mumbai Trans Harbor Link road, Worli- Sewri and several other flyovers and routes.
The MMRDA has no source of income. His income is based on the liquidation of his plots of land in the Bandra Kurla complex.
“Although the MMRDA currently has a lot more money than it has ever had, the number of projects it has undertaken are many. Megaprojects are very expensive. Although funds are being raised in the form of loans, it is still insufficient,” an official said.