The Hindu : Front Page : Corporation to consult Isaac

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Monday, Nov 19, 2007
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Corporation to consult Isaac

Staff Reporter

To find ways to raise funds for JNNURM projects

Mission to fund 50 per cent of the project cost
Civic body has to raise Rs.200 crore for the projects

Kochi: The Kochi Corporation is planning to seek the advice of Finance Minister T.M. Thomas Isaac to find out ways to raise the nearly Rs.200 crore needed for the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) projects being implemented here.

The Corporation has sought an appointment with the Finance Minister to discuss how to raise funds for the projects, Deputy Mayor C.K. Manisankar said on Sunday. As per the guidelines of the Mission, the civic body where the projects are implemented would have to raise 30 per cent of the project cost.

The Mission would fund 50 per cent of the project cost and the State government would have to shoulder 20 per cent of the total cost. In the case of Kochi, 30 per cent of the total projects cleared would cost more than Rs.200 crore. Given the revenue resources and financial position of the Corporation, it would not be able to raise the funds on its own.

Even if the Corporation decided to secure a loan to raise the amount, the repayment and interest component would be a burden on the city. The Corporation needed to talk to the Finance Minister to explore ways to overcome the problem, Mr. Manisankar said.

Though it was widely expected that the Corporation’s revenue would go up once the plinth area-based building tax assessment system was implemented, it did not increase as expected.

A rapid tax analysis done in Kochi found that the Corporation’s revenue from the building tax would go down considerably once the new plinth area-based system suggested by the State government was implemented.

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