Varanasi to be the second city to raise money through municipal bond

Varanasi to be the second city to raise money through municipal bond

Varanasi: As a result of a landmark decision of the Uttar Pradesh government, Varanasi is all set to be the second city after Lucknow to raise Rs 200 crore fund by issuing municipal bonds. The municipal corporation of the holy city has started preparing the bond in the parliamentary constituency of Prime Minister Narendra Modi. The funds raised through this bond will be invested in various infrastructure schemes and the development of Varanasi.

With the issuance of this bond, the Varanasi Municipal Corporation will also have a better image in the public and it will also help in raising investment from across the world. Prior to launching this bond, independent financial agencies rate it, which confirms the international standard.

In Varanasi, the budget of the fund will not only boost the growth of various sectors but will also help in the development of international standards and work. This bond will also help investors to invest in the city and will also promote the tourism sector. All these activities, together will help in the increment of income of the government.

The work of development of Ghats, ring roads, Sri Kashi Vishwanath Dham, Khirkiya Ghat, Rudraksha Convention Center, flyover, CNG trains (to prevent pollution), CNG boats in River Ganga, Inland Water, connectivity of airways, modern medical system and promotion of tourism is being done.

With the increase in the area of ​​Municipal Corporation, 89 new revenue villages have also been added, from where the Municipal Corporation will increase its income through various activities as well as provide new employment opportunities to the people.

According to municipal commissioner Gaurang Rathi, “For issuing Municipal Bonds, a Consultant Firm/Merchant Banker will be selected for which the tender has been withdrawn, in which 9 companies can participate according to the guideline of the Department of Municipal Development, Government of India. The companies include AK Capital Services Limited, Axis Bank Limited, Darashaw & Company Private Limited, ICICI Bank Limited, ICRA Management Consulting Services Limited, SBI Capital Market Limited, Spa Capital Advisor Limited, SREI Infrastructure Finance Limited, and Yes Bank Limited.”

Municipal Corporation Chief Accounts Officer Manoj Tripathi informed, “CRISIL, ICRA, CARE, etc, are working agencies out of which two agencies need to be rated. Municipal bodies of Double-A or Triple-A can issue bonds but the current investment rating of Varanasi Municipal Corporation is Triple B which is required to be reformed and converted into Double-A for investment.”

It is to be mentioned that a committee under the chairmanship of the Additional Commissioner has also been constituted for the bond-related proceedings in Municipal Corporation Varanasi.

It is worth mentioning that a municipal bond is a kind of credit card from which funds are raised. In this, a bond issuing institution borrows money from the market for a fixed time and guarantees to return the principal amount along with the interest.

It is to be informed that to continue development works in the city, a large sum of money is needed, for which the municipal corporations raise money by issuing bonds and spend it on works like the development of the city’s infrastructure.