The Mumbai Development Fund is likely to go through a litmus test during the winter session of the State Legislative Assembly at Nagpur.
The much-touted Mumbai Development Fund (MDF) - aimed at making the city self-sufficient to meet its future infrastructure needs in the coming decades - is likely to go through a litmus test during the winter session of the State Legislative Assembly at Nagpur this week.
The fund’s draft legislation proposes to draw money from the Centre as well as impose minor taxes on Mumbaikars to raise Rs1,500 crore annually to boost infrastructure development to transform Mumbai into a world-class city. As an independent segment of the state’s overall budget, the legislation focuses the need for a direct fund flow from those who would directly benefit from the improved infrastructure in the city.
Reserved specifically to develop Mumbai, the MDF will leverage the city’s most prized possession, its land. For example, funds coming to the state through sale of raised floor space index (FSI) or the premium expected from the sale of the Dharavi land where an FSI of 4 is offered for redevelopment, would go to the MDF. Similarly, the conversion from leasehold to free holds and usage of Transfer of Development Rights (TDR) for cess buildings will bring in funds, which would add to the MDF.
“Large part of the MDF will be initially used for the proposed redevelopment of the Mumbai Metropolitan Region (Thane-Vasai-Virar, Navi Mumbai, Karjat and Alibaug) for which a master plan is being prepared with the help of the World Bank,” said an official. The state Finance ministry had raised concerns about the fund as the state has adopted the policy to abolish setting up new funds. But, after some debate, a revised draft was proposed. “The fund was approved as MDF would be raising funds directly for the city since a public-private partnership strategy has been found inadequate to boost the growth engine,” said another official.
The state wants the committee formed by the Task Force for Mumbai to be designated as the implementation agency for MDF. The committee comprising top civil officials, private citizens and representatives of implementing agencies will shortlist the projects and administer MDF. Another state source has said that the MDF proposal will also serve as a test to ensure that local MLAs do not squander the funds.
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