Vadodara moots Rs 65 cr plan for city upgradation

The Vadodara Municipal Corporation (VMC) commissioner, G P Joshi, has proposed a Rs 306 crore surplus budget for the financial year 2005-06, with no provisions for the outstanding gas bill to GAIL India.

The corporation has also proposed a Rs 65 crore development plan for the city.

In November 2004 GAIL had slapped a notice to VMC for clearing outstandings worth Rs 282 crore with the Oil and Natural Gas Corporation (ONGC) in 15 days. ONGC was a gas supplier to VMC before GAIL came into existence.

"We have not made any provisions in view of the on going dispute with GAIL as we don't anticipate their claim for the payment. The negotiations with the concerned authorities are on and we are expecting a favorable result. The rate at which GAIL is seeking the payments is not reasonable," said Joshi.

On the interest shown by the Adani Group in taking over the VMC gas project, Joshi said, "The proposal has not been taken on consideration yet."

However, the ruling wing seems to be unmoved in spite of the absence of any provisions for payment to GAIL. The standing committee is more concerned with the proposed hike in various taxes as the election for VMC is due in September this year.

The Rs 65 crore development plan includes enhancement of drainage system and road network and drinking water supply system.

VMC expects to earn revenues of about Rs 150 crore from octroi in the current fiscal 2004-05 and expects the same to cross Rs 165 crore in fiscal 2005-06.

The VMC aims to collect around Rs 13 crore from the proposed increase in rate of tax in property, water and street light.

"We will oppose the proposed budget as the move to hike taxes will affect the people. There are other options to earn revenue such as recovery of outstandings from tax defaulters," said Ajit Patel, chairman, standing committee.

Patel added, "At present provisions for a possible payment to GAIL is not the priority for VMC. We need to think about the proposed taxes in the budget that will affect the people at large in the city."

For fiscal 2005-06 revenues from the gas project is estimated to be around Rs 19.29 crore against the operational cost of Rs 19.25 crore.

VMC is planning to commission about 2,000 new gas connections in the next financial year. At present VMC has about 70,000 gas connections in the city.