Magazine 2013
International Peer-Reviewed Journal  
RH, VOL. 3 JULY 2013  
Urban Iunfrastructure And  
Financing Bodies In Mumbai  
Prerna Ramteke  
Urbanization is one of the major forces of change in society. It is a worldwide, phenomenon and  
is irreversible. It affects the nature of Economic development, the demographic, ethnic and many other  
social processes. Today in Mumbai we see a lot of Infrastructure development leading to faster growth  
of the city. The GOI and GOM have set up bodies in financing these projects and have also involved the  
local self government and foreign banks to aid these projects for the development of Mumbai into  
maximum city. The paper highlights various projects being carried out in Mumbai and the funding  
agencies which are involved in these infrastructure projects.  
Keywords - IHSDP – Integrated Housing and Slum Development Programme, Infrastructure Development  
JNNURM – Jawaharlal Nehru National Urban Renewal Mission, UIDSSMT: Urban Infrastructure  
Development Scheme for Small and Medium Town, Urban Local Bodies (ULB)  
Urban Local Bodies (ULB)  
Cities play a vital role in economic growth and development. Sustainable development of cities largely  
depends on their physical, social and institutional Infrastructure. India has a very low level of urbanization and  
the structure of urbanization is slowly changing. During 1951-1991, Urban growth was restricted to few areas.  
The Indian urban population today is greater than 250 million. Increasing population has put pressure on  
existing Infrastructure, services and amenities of urban centers which require large investment for accelerating  
the growth rate of economy.  
In 2001 world urban population was 2.9 billion about 47% of the total population. Among the Asian  
countries today we are the most populous. According to United Nations Study (1995), by 2015 ten of the  
world’s fifteen largest cities will be in Asia, and among them 3 will be in India and out of the 10 most populous  
countries in the world six (6) will be in Asia.  
The Structural Reforms of 1991 (Liberalization) Policy led to more rural-urban migration and the pace of  
urbanization leading to growth of more metropolitan cities which provide Education, business, health care,  
employment, entertainment options etc. According to 2001 census, 285 million population i.e. 27.8% of 1027  
million total population of India resides in 5161 cities and towns in India compared to 25.7% population living  
in urban areas in 1991.  
Increasing population leads to negative environmental and social effects. Today’s urban India represents  
a pathetic scene. Cities have become a site of rotting garbage, degrading drainage systems, poor have no  
access to covered toilets and in many cities majority of people have to defecate in the open which in turn leads  
to health hazards.  
India has the second largest urban population in the world and more than 2/3 of the people live in 393  
cities with a population of more than 1 lakh. As per 2001, census 285 million population i.e. 27.8% of 1027  
million total population of India is residing in 5161 cities and towns in the country. Where as in 1991, 25.7%  
population lived in urban areas.  
In 1981 there were 12 cities, In 1991 there were 23 and in 2001 there were 35 cities in India. as per  
projections of Government of India. the urban population of the country in 2011 will be 405.26 million and  
53.04 million in 2021.  
Table 1:  
Urbanization in India  
% of Urban  
No. of Towns  
Total Population  
in millions  
Urban Population  
in millions  
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RH, VOL. 3 JULY 2013  
Source: Census, 2001  
An analysis of the distribution of Urban population by size and categories reveals that the process of  
Urbanization in India has been large city oriented, this reveals that large proportion of urban population is  
concentrated in Class I cities which show gradual systematic growth in the last century. The number of Class I  
cities has grown tremendously from 24 in 1901 to 423 in 2001. During 2002, there were 3641 Urban Local  
Bodies (UB) in India, 107 were Municipal Corporations. 1443 municipal councils, and 2091 Nagar Panchayats.  
The highest number of local bodies were in TN (719) followed by UP (628), MP (334) and Maharashtra (245),  
WB (422). The urban local bodies have implemented 50% reservation for women councilors like in MP & Bihar  
as against 33% in other bodies. Thus the task of improving Urban Services in constantly more challenging due  
to the large increase in population. This puts a strain on the present management and delivery systems.  
Delivery Mechanism in many needs to be redesigned to meet the large demand. There is a need for even  
greater acceleration in Urban Infrastructure investment. It would be advisable to decentralize the Instruments of  
Infrastructure provision so that the agencies providing Infrastructure services are able to Finance themselves  
and meet the demands of growing city. Decentralization refers to the dispersal of agents of higher levels of  
government into lower level arenas. It can also be described as administrative decentralization or downward  
fiscal transfer by which higher levels in a system code influence over budgets and Financial decisions to lower  
levels. This authority may pass to decentralized bureaucrats who are accountable only to superior at higher  
levels or to unelected appointees selected from higher level.  
Decentralization can entail transfer of Power to different levels in political systems. It can be bestowed on  
one or more intermediate levels. The two paradigms which had long dominated political analyses of less  
developed countries and the political development or modernization school and dependency theory became  
less convincing during the 1980’s. New modes of analysis gained popularity in their place & helped prepare  
ground for experiments with decentralization. During 1980’s some donor agencies also began to shift their  
emphasis away from large scale development programmes to more modest, micro level projects into which  
grass roots communities could be drawn as participants in the hope of making development more sustainable.  
This helped open the way to decentralization. The collapse of Soviet Union and end of Cold War also played  
a vital role. It lead to the Globalization and restructuring of society, economy and polity.  
The constitution of 74 Amendment Act, 1992, has marked the beginning of a historical reform to  
decentralize power at the grass root level in urban areas of the country. It provided a constitutional form to the  
structure & mandate of municipalities to enable them to function as an effective democratic institution of local  
self government. One of its most important objectives is to promote peoples participation in planning, provision  
and delivery of civic services. It introduced some fundamental changes in the system of municipal governance  
with a new structure, additional devolution of functions, planning responsibilities, new system of fiscal transfers  
and empowerment of women and the weaker sections of the society. There have been significant changes in  
the Institutional structure for the financing and management of the basic services in the post decentralization  
period. This provision was made by the 74 Constitution Amendment Act. The Tenth (10 ) Finance Commission  
had recommended the transfer of resources to the both urban and rural bodies in India. It recommends Rs.1000  
crores for municipalities during 1996-2000. The eleventh (11 ) Finance Commission recommended a grant of  
Rs.2000 crore for Urban Local Bodies for period 2000-2005. This would supplement the funds flowing from the  
status to the UCB’s on the recommendations of States Finance Commissions. Provisions of basic services such  
as water supply, sewerage, sanitation, solid waste disposal and street lighting has traditionally been the  
responsibility of local government and are being provided through state government departments, state level  
boards, corporations etc. Public Health, Engineering Department, PWD, Urban development department,  
Housing Boards, Department of Local Self Government, Water Supply and Sewage Boards etc are some of the  
departments of the state govt. which performs municipal functions.  
Metropolitan Planning Committee and District Planning Committee have been formed to take up  
developmental activities in the concerned region. The ULB’s have also been empowered to take up development  
functions. The JNNURM, UIDSSMT and IHSDP like Infrastructure Development Schemes of Govt. also focus on  
Financial and Functional aspects of decentralization World Bank in India is mainly contributing in urban water  
International Peer-Reviewed Journal  
RH, VOL. 3 JULY 2013  
and sanitation Project, it has initiated training programmes in TN, Karnataka, and UP with focus on developing  
the basic capacity of the staff of ULB’s and State Governments. Asian Development Bank has developed its  
Urban Lending operation by supporting state wise urban development projects & credit lines for housing &  
urban infrastructure through domestic financial intermediaries. DFID & UNICEF have entered the urban scene in  
India recently. They focus on poverty reduction and improving the living conditions of slum dwellers. USAID  
through its FIRE Project is promoting Commercially Viable Infrastructure Projects and City Management  
Associations. It is also assisting state and local officials in Introducing Changes at the local level in the operation  
of water systems. Japan Bank for International Cooperation is also entering in the urban sector to provide  
financial assistance in the development of urban water and sanitation infrastructure.  
The history of a nation is created by the milestone events which drastically change the way society is  
governed, organised and bequeathed to the new generation. The 74 Constitution Amendment Act, 1992, has  
thus become the milestone in the history of Urban administration in India. It recognized municipalities as  
constitutional bodies forming the third tier of the Federal Policy of India. Municipalities and other Institutions  
delivering municipal services are facing acute resource crunch to tackle this problem Government of India has  
launched Jawaharlal Nehru National Urban Renewal Missions (JNNURM). The mission is aimed at creating  
economically productive, efficient, equitable & responsive cities with focus on.  
Improving and augmenting the economic & social Infrastructure of cities.  
Ensuring basic services to the urban poor including security of tenure affordable prices.  
Initiating wide ranging urban sector reforms to eliminate legal, institutional and financial constraints that  
have impeded investment in urban infrastructure & services.  
Strengthening municipal governments and their functioning in accordance with the provisions of the 74  
Constitution Amendment Act, 1992.  
The Central Government has started the JNNURM in the year 2005-06 to provide basic services to the  
urban poor & improve the urban infrastructure and urban governance (UIG). Under UIG submission, funds are  
provided to the extent of 50% to 90% of the Project cost depending on the population of various cities, by the  
Central and State government.  
A transparent system of municipal accountability and disclosure to public & higher level of government  
through laws and regulation should be ensured. Thrust of urban development policy under the decentralized  
regime should be towards promoting balanced regional development for providing better living conditions for  
the future generations.  
Sector wise details of Projects  
Sr. No.  
No. of Projects  
Approved Cost Cr.)  
Water Supply  
Mass Rapid Transport  
Storm Water Disposal  
Roads/ Bridges / Flyovers  
Bus Purchase  
Solid Waste Management  
Preservation of Water Bodies  
Station Area Improvement  
City-wise details of Projects  
Sr. No.  
No. of Projects  
Approved Cost  
( Cr.)  
Greater Mumbai  
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RH, VOL. 3 JULY 2013  
Navi Mumbai  
Kalyan- Dombivali  
Mumbai Urban Development Project (MUDP)  
Mumbai Urban Development Project – Revolving Fund (MUDP-RF) has been established in the MMRDA  
in 1988 with the objective of co financing projects similar to the Mumbai Urban Development Project (MUDP)  
particularly projects for Sites and Services and Slum Up gradation by public bodies. Projects and Programmes  
for improvement in local government services could also be financed from the MUDP- Revolving Fund. It can be  
used for equity participation in remunerative projects.  
Mumbai was one of the five cities included in the centrally sponsored Mega City Scheme launched by  
the Government of India in the Eight Five Year Plan. The Scheme aimed to prepare the local governments to use  
institutional finance and eventually market instruments like municipal bonds for the capital investment requirements.  
Of the total project cost, the Government of India and the State Government provided 25% each and the  
remaining 50% was to be raised from financial institutions by the implementing agencies. The Scheme for  
Mumbai was being implemented in the urban core of the Mumbai Metropolitan Region (MMR). The areas  
covered under the scheme are Brihanmumbai, Navi Mumbai, Thane, Bhiwandi- Nizampur and Kalyan-Dombivali.  
The MMRDA is the nodal agency as well as one of the implementing agencies of the Scheme. The other  
implementing agencies are MCGM, MSRDC, BEST, CIDCO, TMC, KDMC, BNMC and NMMC. Mega City Scheme  
Revolving Fund (MCSRF) has been set up in the MMRDA for channelizing funds received from GOI and GOM.  
A State level Sanctioning Committee approves the projects under the Scheme. The Scheme has been implemented  
during the 8 , 9 and 10 Five Year Plan periods. It is discontinued in the 11 Plan. In all, 65 projects costing  
Rs. 1777.84 Cr. Including 2 studies costing Rs.1.62 Cr. were approved by 2004-05, Rs.921.87 Cr. have been  
received by the Mumbai Megacity Scheme from GOI and GOM, out of which Rs.910.79 Cr. have been disbursed  
till March, 2012 to the various implementing agencies towards the approved projects. From the repayment of  
soft loans extended to 65 projects, the Megacity Scheme Revolving Fund Scheme is established and with a set  
of regulation approved by the SLSC and GOI, financing of new projects started.  
Under the new MCS-RF scheme infrastructure projects by the Municipal Corporation and infrastructure  
agencies are being provided loan @ 8% per annum and the Municipal council being provided @ 7% per  
annum. So far Rs. 325.73 Cr. is sanctioned for the Underground Sewerage projects of three agencies out of  
which Rs.38.07 Cr. has been disbursed till March, 2012.  
Project-Wise Details of Mumbai Megacity Scheme  
Sr. No.  
Name of the Project  
MCGM – old work  
Implementing Agency  
Street Lighting  
Land Development at Kharghar  
Road Bridge at Airoli  
Palm Beach Resort  
Mumbai Urban Transport Project  
After successful completion of the Bombay Urban Transport Project (BUTP) in 1984 at a cost of about  
Rs.390 million, the MMRDA had formulated a multi modal project viz. Mumbai Urban Transport Project (MUTP)  
to bring about improvement in traffic and transportation situation in the MMR with the World Bank Assistance.  
Mumbai Monorail Project  
Considering the increase in population, increased travel demand in Mumbai city and narrow road networks  
running through congested structures, there is a need of a system which will occupy less space as well as  
reduce travel time. With the objective, to support public rapid transit system such as suburban rail system and  
metro rail system and where public rapid transit system is not available or impossible to provide such system  
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RH, VOL. 3 JULY 2013  
and where widening of roads is not possible due to structures on either sides, Mono Rail System is proposed  
to be implemented by MMRDA/GOM.  
Mumbai’s first Monorail Corridor: Sant Gadge Maharaj Chowk – Wadala – Chembur Station MMRDA proposes  
to implement a proven and established Monorail System in various parts of Mumbai Metropolitan Region  
MMR). Implementation of about 20 kms Monorail System from Sant Gadge Maharaj Chowk – Wadala –  
Chembur Station as a Pilot Project is under progress.  
Transport interchange activities, passenger transfer between trains, buses, taxies and Private vehicles  
station area are most congested. The problem aggravates with the road side hawking and vehicular parking.  
The sky elevated walk way dedicated to the pedestrians connecting the railway Station / high concentration  
commercial areas and points where concentration of pedestrians prevail. The purpose of the skywalks is for  
efficient dispersal of commercial station / congested area to strategic locations viz. bus stops, taxi stands,  
shopping areas, off roads etc, and vice versa help decongest the crowded streets.  
Implementing Agencies  
Out of 36 nos. of skywalks proposed to be constructed, construction of 7 nos. are under MSRDC and 1  
no. is under KDMC.  
Before finalizing detailed project report i.e. before preparing GAD; local people, corporators, from the  
area are being contacted to understand their views/ suggestions/ concurrence etc. PMC for these works have  
been and they are asked to co-ordinate with other concerned depts.. Like MCGM, Railways etc.  
Versova- Andheri- Ghatkopar Corridor (Metro Line – I)  
Route Length: 11.40 km, Cost Rs.2356 cr, VGF: 650 cr  
Construction work is in progress. The project is expected to be completed by the mid 2012, but today  
in the beginning of 2013 it is yet to be complete. Versova- Andheri- Ghatkopar Corridor is 11.40 km elevated  
corridor which is supported by columns at the road median. It will enable connectivity of Eastern and Western  
suburbs to Western and Central railway. It is also proposed to provide interchange facility with the Central and  
Western Railway at Ghatkopar and Andheri respectively. The corridor reduces the travel time from 71 min to 21  
min. The corridor caters to the MIDC, SEEPZ and other commercial areas. 85% of the work is completed.  
Charkop- Bandra- Mankhurd Corridor (Metro Line- II)  
Cost of the Project: Rs. 8250 cr. (@ 2008 Price Level), Fully elevated: 31.871 km  
Schedule of Implementation: 2010-2014, VGF Grant from GOI and ndash; Rs. 1532 cr.  
While according approval for standard gauge, government directed to extend the underground section  
from Mahalakshmi to Bandra, thus increasing the cost to Rs.3000 cr. Due to high cost the project became less  
attractive for BOOT/PPP. Subsequently it was decided to merge the elevated section of Charkop-Bandra-  
Colaba and Bandra-Mankhurd and reconfigured as Charkop- Bandra- Mankhurd fully elevated to make it  
financially viable and attractive for BOOT/PPP.  
In the 15 meeting held on August 5, 2008 Empowered Institution approved the project cost as Rs.7660  
Cr. Excluding R and R, utilities shifting and state taxes, as per the suggestions of DEA and MoUD, the RFP and  
DCA documents were modified and resubmitted on 18 August, 2008 for appraisal of Empowered Committee.  
The Empowered Committee in its meeting held on August 25, 2008, examined the documents in detail, accorded  
in-principle approval and recommended the project to Finance Minister for approval of VGF support of Rs.1532  
cr. DEA accorded approval for VGF funding (Rs. 1532 cr) on November 3, 2008.  
In its 228 meeting held on 29.07.09, Executive Committee approved the financial bid submitted by  
consortium led by M/s. Reliance Infrastructure Ltd. Bhoomipujan ceremony was held on 18.7.2009 by the  
hands of Hon’ble President of India. Special purpose Vehicle “Mumbai Metro Transport Pvt. Ltd” incorporated  
on 29.10.2009. Consortium comprising of M/s. Feedback Ventures, Ineco (Spain)., Prointec (Spain is appointed  
as Independent Engineer on 13.09.2010.  
Concession agreement between GOM and Mumbai Metro Transport Private Limited is singed on  
1.01.2012. Financial closure achieved on 14 March, 2011. MCZMA strongly recommended the proposal for  
CRZ clearances for proposed Charkop and Mankhurd MRTS car depot/workshop allied activities to MoEF,  
clearance from MoEF awaited. Received MoEF, CRZ Clearance on 20.12.2012. The corridor is expected to be  
commissioned by 2015-16.  
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Colaba- Bandra= Corridor (Metro Line- III)  
Cost of the Projects – Rs. 21752 Cr (Excluding R and R, utility shifting, state taxes, IE fees etc) at 2011 price  
Salient Features  
Route Length (between dead ends)- 33.5 km, Underground – 33.5 km  
Number of stations - underground 27 Nos.  
Design speed – 80 kmph  
Depot- Aare Colony  
Detailed project report for this corridor was prepared by M/s. RITES Ltd. in November, 2011. Project to  
be implemented with JICA Loan Assistance. GoM forwarded proposal to MoUD on 13 Feb, 2012 for inclusion  
of project in JICA rolling plan.  
These are the Projects carried out in the city of Mumbai. Most of them are at various stages of completion  
and some are yet to be started. The planners are hoping to make Mumbai a world class city on the lines of  
Shanghai and for which these Infrastructure are added. They aim to ease the life of people of Mumbai and  
develop Mumbai into a mega city of International standard the funding is a vital part which is the responsibility  
of the GOI & GOM which are contributing on a large scale.  
The Bombay Municipal Corporation dates back to 1726. It provided the governance to the local elite  
and were set in place by virtue of their social standing, rather than democratic elections. Lots of programmes  
are run by the ULB and the limited fiscal autonomy of local bodies renders them excessively dependent on the  
state & central governments. Resource constraints exacerbate the dependence on state agencies and  
administrative structures. Elected members behave like contractors & poor are excluded from political  
participation. They also decide which contractors to be awarded contracts. One of the encouraging feature is  
the rise of civil societies & NGO’s and their urge to participate in affairs of their cities. NGO’s play a healthy role  
in leading strength to the voice and demands of the less privileged. They participate in implement projects and  
promoting participation of poor and servicing their interests. The planning and implementing bodies must  
encourage sustainable development in the infrastructure of growing cities in India. The quality of work should  
be tested at all stages so that they are answerable for the final product which measures growth in a city. The  
deadlines for completion of these projects must be set and adhere to. People of Mumbai are hoping to see a  
new well equipped Mumbai with lots of better Infrastructure facilities and a better life. The government and the  
people are looking forward to a maximum city as its called today.  
Kundu Amitabh (2006). Trends and Patterns of Urbanization and their Economic Implications, Delhi, India  
Infrastructure Report-2006. Print.  
Planning Commission Report of the Working Group on Urban Water Supply and Sanitation Sector for  
Ninth Plan (1996), Planning Commission, Delhi : Government of India, Print.  
Rai Nishith & Singh Awadesh Kumar (2010). New Dimensions of Urban Management in India, New Delhi  
Serial Publication. Print.  
Sandhu, Ravinder Singh. ed., Urbanization in India – Sociological Contribution (2003). New Delhi : Sage  
Publications. Print.  
World Bank: Urban Infrastructure Services Review, World Bank, Delhi, (1997). Print