Left to use USAID funds for civic reform

The government of West Bengal has decided to take technical assistance from the United States Agency for International Development (USAID) to improve infrastructure like water and sanitation services in the state, Asok Bhattacharya, state minister for urban development and municipal affairs, admitted today.

The Left Front has so far been most agency about accepting aid from western nations as they suspected funding would come with strings attached.

The position has been revised by West Bengal chief minister Buddhadeb Bhattacharjee, and the government recently accepted funding from UK's DFID for restructuring of some public sector enterprises.

"This will be a part of the Indo-USAID financial institutions reform and expansion (Fire-D) programme, and in its third phase, West Bengal, along with six other states, has been included," said Bhattacharya.

Under Fire-D, the state shall receive technical assistance to address important issues like capacity building of the municipalities, waste management and development of a market-based urban infrastructure finance system.

"Expert teams shall conduct pilot projects in the first phase in the Durgapur-Asansol belt and in the Siliguri area," said Bhattacharya.

The team will study three tiers of the government and help develop a policy and regulatory environment to facilitate service delivery at the centre level, besides aiding capacity building for commercially viable water and sanitation project development using market-based financing at the state level.

This would require creditworthiness and efficient delivery and management of the services at the municipal level.

The other states covered under the programme will be Rajasthan, Uttaranchal, Orissa, Madhya Pradesh, Maharashtra and Karnataka.

Bhattacharya said West Bengal would seek help from USAID to migrate all the 126 municipalities in the state to the accrual method of accounting instead of existing single entry method in many.

A municipal development fund to handle funding from all possible sources like the central and state governments, banks and foreign funding agencies could also be constituted.

"Municipalities should be equipped to raise funds not only from regular sources but also from the capital market. A major objective of the project shall be to design a mechanism so that municipalities can approach the capital market to raise funds," said Bhattacharya.

In Karnataka, a model municipality had recently raised funding worth $30 million.