A Town On The Go

IT'S a unique turnaround. The Ahmedabad Municipal Corporation (AMC) which showed losses of Rs 35 crore and a bank overdraft of Rs 22 crore till 1994 today runs a revenue surplus and has reserves worth Rs 80 crore. Besides, with an A+ credit rating from CRISIL, AMC will shortly float a Rs 100-crore non-convertible debenture issue, the first by a municipal body in the country. The credit goes to Municipal Commissioner K.S. Varma, who has transformed one of the most disorganised Indian cities into a role model for civic restructure and the subject of a case study by the United Nations Development Programme (UNDP).

The first thing Varma did when he took over was tackle the issue of octroi collection. "The system was virtually controlled by the local mafia. I decided to confront the mafia head-on and neutralise their influence," he says.

Next came the valuation books, which had not been updated for 40 years. They were re-evaluated with professional help. A three-tier random check of goods and round-the-clock vigil drove collections up from Rs 30 lakh per day in 1994 to Rs 60 lakh now. This was followed by a property tax recovery drive through seizure and attachment of movable and immovable properties, disconnection of water supply and sewerage and computerisation. AMC collected Rs 82 crore in property tax in 1995-96 against Rs 47 crore in 1993-94. Total revenue income for 1996-97 is expected to be Rs 480 crore.

The enhanced resource base has been used to upgrade AMC's management, enforcing rules and improving civic life in the city. Says Varma: "With right financial planning and professional management, the improvement in services can be replicated in other cities as well." Deputy Commissioner P.U. Asnani echoes the sentiment: "Setting our own house in order first, we took strong measures to discipline recalcitrant unions, increase productivity and build corporate perspectives. AMC has now started inducting professionals in its cadre." 

The corporation has also become liberal with its investment. It ploughed in Rs 180 crore for capital works in '96-97. The sewerage system used up Rs 8.56 crore in the last two years against Rs 2.46 crore in the preceding two, while street lighting absorbed Rs 10.86 crore to only Rs 4 lakh. AMC has spent Rs 25 crore as against Rs 2.86 crore on road resurfacing and reconstruction. Says Anil Gupta, head, corporate planning, Amt-rex Appliances: "The changes are not subtle. They can be seen on every street corner and slum, even the crowded walled city." 

To cater to the city's 40 per cent population living in slums, AMC has started a Slum Networking Project with the help of slum dwellers, non-government organisations (NGOs) and industry. Explains Varma: "Any infrastructural development for a city will have to include slum improvement schemes that are self-sustaining." Arvind Mills,

Core Parenterals, Ashima Syntex, Nirma, Reliance and the Torrent Group have shown keen interest in the Rs 350-crore project which will cater to 12 lakh people at 2,412 sites. AMC has also taken up a pilot project with the help of Arvind Mills and Saath, an NGO, at Sanjay Nagar Tekri. Of the total cost per family of Rs 13,000 for all facilities, each slum dweller will pay Rs 2,000, matched equally by the corporate house, the NGO will contribute Rs 3,000 and AMC the remaining Rs 6,000. 

"We insisted on some contribution from the slum dwellers," says Varma, "so that they have a stake in maintenance and a sense of ownership in the new facilities." AMC has tied up with Sewa Bank which will collect monthly instalments from the slum dwellers. "They have decided to contribute Rs 500-1,000 more to maintain the slums on their own," says Asnani.

To sustain this mode of working, the city has chalked out a perspective plan till AD 2011. The bridges on Sabarmati river will be expanded with internal accruals and HUDCO loans. Projects for water management, sewerage systems and city greening have been launched. Says D.B. Makwana, deputy commissioner, finance: "We estimate octroi collections to grow by 25 per cent each year. The Rs 350 crore property tax arrears too are a source. Most projects will be self-financing." Enhanced by funds AMC hopes to raise through its debenture issue, the real test. If AMC passes this one, it will be an example for other city corporations to follow.