The Pune Municipal Corporation (PMC) has realigned its funding strategy for developing a robust sewage management system in the 23 newly included villages. Initially, PMC had planned to secure a Rs 530 crore loan from a domestic bank, but now it is seeking a more favorable loan from the Japan International Cooperation Agency (JICA) due to the lower interest rates offered.
Expansion and Sewage Management Needs
The Maharashtra State Government decided to merge these 23 villages into PMC in July 2021, driven by the region’s rapid growth. Earlier, in 2017, 11 villages were also incorporated into PMC, and sewage management projects worth Rs 392 crore are already in progress for these areas.
Comprehensive Sewage Infrastructure Plan
To address the sewage management needs of the newly added villages, PMC has allocated Rs 1,367.94 crores. This plan takes into account the projected population growth until 2054 and includes:
- 471 km of Sewerage Channels: This comprises 90.42 km of main sewerage channels, with a total cost of Rs 922.65 crores.
- Sewage Treatment Plants: Seven plants with a combined capacity of 201 million liters per day (MLD) are planned, costing Rs 445 crore.
A comprehensive proposal amounting to Rs 1,367 crores has been meticulously prepared to ensure sustainable and efficient sewage management.
Shift from Bank Loans to JICA Funding
Given the high-interest rates associated with domestic bank loans, PMC has opted to pursue funding from JICA. The corporation has previously secured a loan of Rs 841 crore from JICA for the Mula Mutha Purification Project at an interest rate of less than 1%, significantly lower than the market rates.
Currently, discussions are ongoing with JICA for an additional Rs 834.19 crore. If successful, PMC aims to secure 85% of the project cost at these favorable rates, significantly reducing the financial burden. A critical meeting is scheduled for June 10 to advance these discussions and finalize the funding arrangement.
Future Prospects and Strategic Planning
PMC’s decision to shift its loan strategy underscores the importance of financial prudence in executing large-scale infrastructure projects. By leveraging low-interest loans from JICA, PMC not only aims to ensure the project’s financial viability but also to expedite the implementation of a modern sewage management system that will cater to the rapidly growing population of the newly merged villages.
