The Hindu 22.10.2010
GVMC to renew efforts for another tranche of loan
G.V. Prasada Sarma
| Earlier, it borrowed Rs. 100 crores from Bank of India |
Some Rs. 250 crores held back as GVMC could not implement reforms process
It is yet to complete GIS mapping, prepare module on property tax, etc.
VISAKHAPATNAM: With over Rs.250 crores held back owing to the reform process not being complied with, the Greater Visakhapatnam Municipal Corporation (GVMC) will renew its efforts to secure the second tranche of loan of Rs.100 crore from banks and financial institutions.
Executing works totalling about Rs.1,800 crores under the Jawaharlal Nehru National Urban Renewal Mission, the GVMC has to contribute 30 per cent towards its share. In the first tranche, it borrowed Rs.100 crores from the Bank of India in June at an interest rate of 8.25 per cent.
Interest rate
It continued discussions with officials of banks and financial institutions for the remaining Rs.100 crores and weighed offers of lower interest rate from some of them.
But with the RBI increasing base rates after September and some banks raising their rates, there was delay in clinching the deal.
Some of the banks had sought more time promising a relatively lower interest rate.
Sources said, with Rs.250 crores remaining unreleased because the GVMC has not implemented the reforms, the money is required to meet the commitments.
Waste management
The GVMC has to complete the Geographic Information System-based mapping and produce a module of property tax that is expected to plug leakages in revenue.
Besides, solid waste management by picking up garbage on the doorstep of the residents all over the city also has to be implemented.
Municipal Commissioner who attended a recent meeting at New Delhi stated that the property tax module would be completed by December and the implementation of collection of garbage from the doorstep in phases.
“With such a situation, we will take up discussions with banks and financial institutions next week in Hyderabad to finalise the loan,” said an official. Earlier, it had raised Rs.70 crores from the LIC.
