A K Bhattacharya: Ahmedabad shows the way

NEW DELHI DIARY

The Sabarmati riverfront development project is all set to change the face of Ahmedabad. Make no mistake about this. The next time you visit the city, slow down your vehicle while you cross one of the many bridges across the Sabarmati river. When you take a look at the river, two things will strike you""the rise in the volume of water flowing in the river and the large number of cranes at work on the northern side of the riverbed.

Ahmedabad, like many other cities in India, has the advantage of a river running through it. And like most of these cities, Ahmedabad too cared little about the upkeep of the river. In the summer months, the Sabarmati riverbed used to remain almost dry with no water. Children would use the riverbed to play cricket or fly kites. Only during the rainy season and the winter months some water used to flow through the river.

All this, however, is changing. The Narmada canal water now gushes through the Sabarmati, raising the water volume in the river round the year. And now the Ahmedabad Municipal Corporation has embarked on a Rs 1,200 crore project to develop the Sabarmati riverfront stretching up to about 11 kilometres along its bank. The first phase of the project, consisting of concrete walkways along the river, will be completed by December this year. The finances of the project have already been tied up.

How did the Ahmedabad Municipal Corporation (AMC) manage to conceive such an ambitious project? Well, it has used some innovative methods to put together the scheme. Some time back, it got the Gujarat government to amend the Bombay Provincial Corporation Act, under which it functions. The purpose of amending the Bombay Provincial Corporation Act was to permit the Ahmedabad Municipal Corporation to float a wholly-owned company under the Companies Act. Once the Act was amended, the AMC could float a company, with an equity base of Rs 200 crore to implement the Sabarmati riverfront development project. A loan of Rs 200 crore has also been raised by the company to start the first phase of the project.

And since 20 per cent of the land to be reclaimed from the riverbed is to be put to commercial use, the project is not likely to suffer from any financial constraint. The project authorities have also ensured an ideal land-use policy by earmarking 26 per cent of the reclaimed land for use as gardens, 6 per cent of the reclaimed land as promenades and the remaining land for public utilities.

What makes the Ahmedabad Municipal Corporation so refreshingly different and more energetic than the so many other depressingly moribund municipal corporations overseeing the management of several towns and cities of India?

One reason could be the financial muscle that the Ahmedabad Municipal Corporation continues to enjoy at a time when most other state governments have either emasculated their corporations by whittling down their powers to raise resources, or the corporations themselves have failed to collect the resources that are due to them.

Gujarat was one of the few states (Rajasthan, Maharashtra, and Punjab are among the others) which refused to abolish octroi from their states. These states opposed the abolition of octroi on the grounds that it was the single-largest revenue source for the corporations. The other states abolished octroi but failed to compensate their municipal corporations for their loss in revenue. As a result, most of these corporations were in financial trouble and they began divesting some of their key responsibilities in the upkeep of the towns and cities they managed.

Today, the Ahmedabad Municipal Corporation earns an annual revenue of Rs 600 crore from octroi, which is almost half of its total revenue collection. It is also among the few corporations in the country which have not divested its water or sewerage maintenance responsibilities to some other autonomous civic body. Just as it has retained the octroi levy, it has also taken direct charge of all its basic responsibilities. The four million people who live within the jurisdiction of the Ahmedabad Municipal Corporation can hope for a better tomorrow, because they have a financially strong body to look after them.

This may not be true of other corporations in most of our cities. True, corruption, efficiency and governance are equally important issues. But the story of the Ahmedabad Municipal Corporation also underlines the need for financial empowerment of all our civic bodies. Not by reimposing octroi in states which had abolished it. But by allowing the municipal corporations tap new sources of revenues and asking them to use such resources for civic development in their region. If Ahmedabad can do it, why should Delhi be left behind?

akb@business-standard.com