Yogi Adityanath lists Lucknow Municipal Corporation bond at BSE
What's the story
Uttar Pradesh Chief Minister Yogi Adityanath listed Lucknow Municipal Corporation bond at the Bombay Stock Exchange (BSE) this morning. The state's capital has now become the ninth Indian city to raise municipal bonds. The BJP leader is on a visit to Mumbai, Maharashtra, and is expected to meet filmmakers today. Yesterday, he met superstar Akshay Kumar over dinner at a South Mumbai hotel.
Statement
It is a matter of pride for UP: Adityanath
The CM said it was a proud moment that "Lucknow Municipal Corporation raised Rs. 200 crore through its bond issue." This, he said, reflects the trust the state has earned in the last three and a half years. "It will augment our effort to improve infrastructure in urban areas and it shows the improvement in the industrial climate of the state," he said.
Explanation
How are municipal bonds helpful for cities?
In a bid to raise funds for specific projects, local municipal bodies issue bonds. As per the rules laid by the Securities and Exchange Board of India (SEBI), a municipal body can issue such bonds only if it doesn't have a negative net worth in three preceding financial years and if it hasn't defaulted in loan repayments during the last one year.
Looking back
LMC's first bond was oversubscribed by 4.5 times
The LMC raised the aforementioned amount on November 13, by issuing bonds on a private placement basis using the BSE BOND platform. Twenty-one bids were placed for Rs. 450 crore. At the time, BSE said out of the 11 municipal bond issuances, whose total amount is Rs. 3,690 crore, a record Rs. 3,175 crore were raised on the exchange's BOND platform.
Plans
After Lucknow, Ghaziabad will raise municipal bonds
After Lucknow, Ghaziabad will be the next UP city to raise bonds. Varanasi, Agra, and Kanpur will raise joint municipal bonds after Ghaziabad, a top government official had said earlier. Adityanath claimed that Ghaziabad municipal bonds will be listed in the coming three to six months. Unsurprisingly, the government plans to use the funds raised by LMC for infrastructure.
Other cities
Amaravati, Pune, and Ahmedabad have also raised bonds
The other cities that have raised municipal bonds are Amaravati, Visakhapatnam, Ahmedabad, Surat, Bhopal, Indore, Pune, and Hyderabad. The respective amounts are Rs. 2,000 crore, Rs. 80 crore, Rs. 200 crore, Rs. 200 crore, Rs. 175 crore, Rs. 140 crore, Rs. 495 crore, and Rs. 200 crore. Interestingly, Lucknow became the first city to issue a bond after Atal Mission for Rejuvenation and Urban Transformation (AMRUT) scheme was launched.
Details
Adityanath will also meet stakeholders to discuss film city's plans
Meanwhile, Adityanath will also meet filmmakers to discuss his government's plan of nestling a film city within Noida. Speaking on this, Adityanath's Maharashtra counterpart Uddhav Thackeray said his government is not jealous of others. "But if you are going to forcibly take anything away, then, of course, I won't let it happen and you (industrialists) will not be willing to go," he asserted.