BMC budget 2025: Proposal to break FD`s for funding infrastructure projects
The Brihanmumbai Municipal Corporation (BMC) has presented an ambitious budget for the fiscal year 2025-26, estimating total expenditure of Rs 74,427 crore, which reflects a 14.19% increase over the revised budget of Rs 65,180 crore for FY 2024-25. This proposed budget comes at a time when the BMC is facing increasing financial pressures to fund vital infrastructure projects and urban development across Mumbai.
For the current fiscal year, BMC has projected Rs 40,693 crore in total revenue earnings by March 31, 2025, of which Rs 28,308 crore has already been earned as of December 2024. Despite these earnings, the civic body has found it necessary to look beyond traditional revenue sources to bridge the financial gap and meet the growing demands of the city’s infrastructure.
In a move to raise funds for ongoing and future projects, the BMC has proposed tapping into its Fixed Deposits (FDs), a strategy known as Internal Temporary Transfer (ITT). Initially, the BMC had planned to raise Rs 6,364.48 crore through ITT in the revised estimates for 2023-24, but the financial circumstances at the time did not require such action. However, given the evolving fiscal landscape and increased spending requirements, the civic body now considers it necessary to liquidate these deposits for critical projects.
The revised estimates for 2024-25 propose to raise Rs 12,119.47 crore through ITT, while the budget estimates for 2025-26 foresee an even larger sum of Rs 16,699.78 crore being raised in this manner. This decision underscores the growing need for liquidity to sustain vital urban development and public infrastructure in the city through March 2025 and beyond.
According to the BMC Budget 2025 document, the budget looks at fiscal discipline and sustainability with emphasis on revenue augmentation, enhancement of Infrastructure and Services and Urban Mobility. Other key highlights of the budget include strengthened Healthcare Infrastructure, efficient Water and Sewerage System, quality Health and Education System, health Facilities, agenda on climate Action, focus on Solid Waste Management Projects and flood mitigation, Enhanced Open Spaces and Greenery.
The BMC also presented an annual education budget of Rs 3,955.64 crores for the Financial Year 2025-26. The civic body has augmented funds allocated for education by approximately Rs 630 crores compared to last FY`s budget (revised) estimate of Rs 3,321.55 crores.
The civic body announced assessment of commercial units in slum area as its new source of income. The budget document states that there are around 2.50 lakh slums in Mumbai. A significant number of these slum areas (at least 20% i.e. 50,000 slums) are being used for commercial purposes such as small and large industries, shops, godowns, hotels, etc. As BMC provides infrastructure facilities to these establishments, it is necessary to recover property tax by assessing these commercial units. Also, this revenue will help to provide better services and infrastructure to slum dwellers. Accordingly, commercial properties in slum areas are being assessed and it is expected to generate a revenue of ₹350 crore from the same.
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