(a) whether the Government has engaged credit rating agencies to assess the
fiscal performance and capabilities on project execution of Urban Local Bodies (ULBs);
(b) if so, whether the Urban Local Bodies (ULBs) would now be eligible to raise funds
directly from lending institutions such as world Bank and Asian Development Bank; and
(c) if so, the details thereof?
THE MINISTER OF STATE IN THE MINISTRY OF URBAN DEVELOPMENT( SHRI AJAY MAKEN )
(a): Four credit rating agencies namely, Indian Credit Rating Agency (ICRA) Ltd.,
FITCH Ratings India Ltd., Credit Analysis and Research Ltd. (CARE) and CRISIL Ltd.
have been entrusted with the task of assigning credit ratings to 69 ULBs under
Jawaharlal Nehru National Urban Renewal Mission (JNNURM). The credit ratings of
the cities will facilitate ULB`s access to funds from different financial institutions
as well as municipal bound markets subject to their fulfilling other requisite
criteria.
(b)&(c): Urban Local Bodies (ULBs) cannot borrow directly from the multilateral lending
institutions such as World Bank and Asian Development Bank. However, ULBs can borrow
from them with the permission of the respective State Governments who may also
require the prior concurrence of the Government of India in accordance with provisions
of Article 293 (3) of the Constitution of India.