Bengaluru’s civic body BBMP under massive Rs. 700 Crore debt

In the recent past, Bengaluru’s civic body BBMP (Bruhat Bengaluru Mahanagara Palike) had made several promises of upgrading the infrastructure in the city. But looks like all these promises might remain unfulfilled due to the massive cash crunch BBMP is facing. 

Recently BBMP Commissioner N Manjunath Prasad wrote a letter to Karnataka Urban Development Department and wanted the BBMP to be placed under the ambit of Karnataka Local Fund Authorities and Fiscal Responsibility Act. The reason why the commissioner wants BBMP to under the act is that the act makes it mandatory for a local body to ‘achieve financial surplus’.

In his letter, Manjuprasad says, ‘There is no financial discipline in BBMP. I have written to the State Government so that there is a system in place where we can spend based on our earning’.

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While the total estimated revenue for the upcoming financial year 2017-2018 is Rs 7315.85 Cr. The Palike is under Rs 706.73 Cr debt, it owes Rs 652.43Cr to State Bank of India and Rs 54.30 to KUIDF. What is also interesting to note is, BBMP owes Rs 15,428.67 Cr to contractors for the last two financial years.

While BBMP is facing difficulties in generating funds, the State Government, on the other hand, has also not released any funds to the struggling civic body. Following the announcement Chief Minister H D Kumaraswamy’s ambitious Farm Loan waiver scheme, the Rs 2,500 Cr funds allotted to BBMP during the budget have not been released.  

The Rs 44,000 Cr plan has left the finance exchequer cash-strapped. Apart from this, the State Government is yet to release Rs 4816 Cr grants which were a part of CM Siddaramaiah’s plan for revamping the infrastructure in the city of Bengaluru.

Bengaluru is facing several civic issues such as the garbage crisis, traffic and potholes among many others.  This crash crunch will definitely impact the several projects as the re-asphalting of pothole-ridden roads, rejuvenation of lakes and parks, road widening. This will also affect the payment of the salary of pourakarmikas who have been demanding clearance of their unpaid salary from the Palike.

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