The Pune Municipal Corporation ( PMC ) is currently facing a severe annual financial shortfall of Rs. 200 Crore, primarily because of outstanding GST dues amounting to Rs. 1,400 crore from the Maharashtra state government. This deficit, which has been accumulating since 2019, is putting a significant strain on the PMC’s ability to deliver essential municipal services and complete vital civic infrastructure projects.
Background of the Issue
The root cause of the financial challenge originated from the merger of 34 villages into the PMC in 2017. These newly merged areas have contributed to additional stamp duty collections, but the corresponding funds have not been credited to the PMC treasury. Further, the Maharashtra government has not settled the GST dues owed to the PMC.
In 2021, Hemant Rasane, a former chairman of the PMC’s standing committee, raised concerns over the delay in payments and urged the state government to clear pending dues amounting to Rs. 1,095 crore since 2019. Today, this figure has grown to Rs. 1,400 crore.
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Impact on Civic Services and Development Projects
The ongoing financial shortfall has catastrophically affected multiple municipal services across various departments. Urbanization, fueled by large-scale projects like Pune Metro, has increased the demand for improved infrastructure, including drainage systems, sewage treatment plants, road networks, and power supply systems. However, PMC’s limited financial capacity has slowed down the pace of these projects, leading to growing concerns about service quality and future development.
The PMC is particularly struggling to meet the increased infrastructure needs of the newly merged villages. Critical initiatives, such as drainage lines, sewage treatment plants, and road improvements, have been delayed due to the lack of available funds.
Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here
Call for Timely Payment of Dues
PMC Commissioner Rajendra Bhosale has emphasized the urgent need for the Maharashtra government to clear the outstanding dues. According to Bhosale, timely collection of these funds is essential for the corporation to move forward with developmental initiatives in these rapidly urbanizing areas.
Municipal Secretary Yogita Bhosale has confirmed that the PMC’s chief accounts and finance office is actively following up on this issue with the state government. Both officials have reiterated that without the timely release of the GST and stamp duty dues, the PMC will continue to face financial hardships, impeding its ability to manage the city’s growth effectively.
As the PMC continues to negotiate with the state government for the collection of its pending GST dues, it faces increasing challenges in maintaining service delivery to a growing population. Resolving this issue is crucial to ensuring that Pune’s infrastructure keeps pace with its rapid urban expansion.
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