CCMC planning to enter money market
After successfully implementing its e-governance system, the Coimbatore City Municipal Corporation (CCMC) is now planning to enter the money market. CCMC is set to take a fresh look at this option in the wake of local administration minister M K Stalin announcing a month ago that the Salem Corporation and some other municipalities in the state have the option of floating bonds to raise funds for infrastructure development schemes. The corporation is awaiting a report on its creditworthiness as it is set to implement a number of infrastructure development schemes for the city under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM). ICRA , a national level rating agency, is in the process of assessing its funding schemes and repayment potential.“While going for loans is an option, we may also explore the possibility of floating infrastructure bonds. But the bond option is subject to Icra’s grading,” P Muthuveeran, commissioner, CCMC, told ET. The credit rating exercise is essential, as the corporations of 63 cities chosen for schemes under the JNNURM are expected to meet 30% of the cost of projects on their own.“We expect the credit rating report to be submitted in a month,” Mr Muthuveeran said. Schemes worth Rs 3,186 crore have been drawn up for Coimbatore city and 30% of the amount has to be met by the Corporation. While the JNNURM envisages a 20% grant from the state government, it is being made available to the Coimbatore Corporation as an interest-free loan. This puts the burden of funding to an extent of 50% on the Corporation. As for its own contribution of 30%, the resource mobilisation mode has been left to the civic body. It can raise loans provided it is found credit-worthy.
