He said the combined receipts of all municipalities in India was estimated to be lower than Rs 1.5 lakh crore, with less than a third of the amount coming from their resources, making them dependent on Central and state governments.
It is also estimated that nearly Rs 65 lakh crore would be required as capital investment and for services in Indian cities over a 20-year period, the minister said, adding therefore the space to raise private funds was "enormous".
He said the municipal finance market faced a range of challenges, including weak administration and political interference by way of waivers.
"Municipalities need to lay a foundation of robust financial management for both enhancing own revenues as well as tapping the capital market through Municipal Bonds," he said.
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Speaking about administrative reforms, he said the time has come to adopt the recommendations of the Second Administrative Reforms Commission and merge the functions of the person chairing the municipal council and the individual exercising executive authority.
Currently, in many cities, the head of a municipal corporation, the mayor, is merely a ceremonial authority and executive decisions are carried out by the municipal commissioner appointed by the state government.
Many states have short-term tenure of mayors like the BMC mayor's tenure is two-and-a-half years.
The minister said the kind of urbanisation India will witness in the 21st century, with technology and innovation at its very core, required skills and expertise would not always be available within the government fold.
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