In order to improve the ease of living in Indian cities, urban local bodies need to have wider access to financial resources. Explain (200 Words)
Refer - Financial Express
Enrich the answer from other sources, if the question demands.
Saravanan 4 years
Pls review
IAS Parliament 4 years
issue is not required, why there is a need to have wider financial access by urban local bodies? Mention the reason. Keep Writing.
IAS Parliament 4 years
KEY POINTS
The High-Powered Expert Committee for Estimating the Investment Requirements for Urban Infrastructure Services estimated the investment required to finance urban infrastructure and services at Rs 39.2 trillion during 2011-2031.
Predictable ULB revenues
· User charges for services like water, fire, permissions, etc, account for the non-tax sources. ULBs also get some income from rentals of its properties.
· UBLs are dependent on devolution and grants from the Centre and respective states.
Urban financing
· The market is shallow with few investors participating, and those who come in, tend to hold the bonds issued by ULBs to maturity.
· Creating a wider pool of investors will require having a predictable and large pool of supply of bonds and an active secondary market.
· This will generate interest amongst various long-term fund managers in insurance, pension funds, mutual funds, and others.
Creating innovative products
· Multiple ULBs can come together to pool their resources to reach out to the market this will create a larger issuance and give investors comfort over the combined credit risk.
· Having a credit guarantee fund could allay some of the concerns. Innovation is also required in pooling together a wider variety of state and municipal bond issues and creating appropriate tranches with suitable risk-return trade-offs.
Priya Verma 4 years
Kindly review and provide feedback.
IAS Parliament 4 years
Try to stick to word limit, underline the key points and include data to support your answer. Keep Writing.
yuvaraj 4 years
please review
IAS Parliament 4 years
Try to provide reference about 15th FFC. Keep Writing.
Dev 4 years
Please Review and Provide Feedback
IAS Parliament 4 years
Try to include about the recommendations of Fifteenth finance commission. Keep Writing.
