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Gujarat challenge for funds release

New Delhi, Jan. 29: The “Gujarat factor” has come in the way of the urban development ministry’s disbursal of funds for the Jawaharlal Nehru National Urban Renewal Mission.

Narendra Modi’s state has come out tops in the first phase of the scheme, completing 42 of 71 sanctioned projects and achieving 87 per cent reforms, the highest among all states. It has also utilised 81 per cent allotted funds, second only to Maharashtra.

Its performance in the 2005-2012 phase of the scheme has left the Centre in a quandary on what method to use to allocate the Rs 15,000 crore sanctioned as a stopgap measure till the 2014 election. The second phase of the scheme is on hold as the Centre wants to allot money to crucial areas such as food security and universal health care.

The urban development ministry is mulling two options for funds allocation: performance-based and population-based. In the first phase, money was disbursed according to urban population strength, with the largest amount going to Maharashtra. Gujarat was then sixth on the list.

Under the performance-based system however, 25 per cent weightage will be given to sanctioned projects completed in the first phase, 25 per cent to mandatory administrative reforms and 50 per cent to urban population strength.

Opting for this system would mean that the largest chunk of funds would have to be given to top-performer Gujarat, ruled by the rival BJP. The urban development ministry is not comfortable with such a proposal, sources said.

“Elections are just 12-14 months away. So, the government wants to utilise every penny in such a way that it will make a difference electorally,” a senior official said.

Compared to Gujarat, Congress-ruled states have not fared well at all. Rajasthan has completed only four of 13 sanctioned projects and Andhra Pradesh 20 of 52.

Maharashtra, where the Congress is in alliance with the NCP, is the only state that has done reasonably well.

Bengal is far down in the list, having completed only 19 of 69 sanctioned projects and utilised 43 per cent funds.