New Delhi (NVI): Telangana has become the third state to successfully undertake Urban Local Bodies (ULB) reform stipulated by the Ministry of Finance and has become eligible to mobilise additional financial resources of Rs 2,508 crore through Open Market Borrowings.
Telangana has now joined the two other states – Andhra Pradesh and Madhya Pradesh – who have completed this reform. On completion of urban local bodies reform, these three States have been granted additional borrowing permission of Rs 7,406 crore, the Ministry of Finance said in a statement.
Reforms in the Urban Local Bodies (ULBs) and the urban utilities are aimed at financial strengthening of ULBs in the State and to enable them to provide better public health and sanitation services, it added.
Economically rejuvenated ULBs will also be able to create good civic infrastructure.
Earlier in May 2020, in view of the resource requirement to meet the challenges posed by the COVID-19 pandemic, Centre enhanced the borrowing limit of the states by 2 percent of their Gross States Domestic Product (GSDP).
Half of this special dispensation was linked to undertaking citizen centric reforms by the states.
The states get permission to raise additional funds equivalent to 0.25 percent of GSDP on completion of reforms in each sector. The four citizen centric areas identified for reforms were (a) Implementation of One Nation One Ration Card System, (b) Ease of doing business reform, (c) Urban Local body/ utility reforms and (d) Power Sector reforms.
So far, 10 states have implemented the One Nation One Ration Card System, 7 states have done ease of doing business reforms, and 3 states have done local body reforms.
Total additional borrowing permission issued so far to the states who have done the reforms stands at Rs 54,190 crore, Finance Ministry stated.