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Lifeline hope for Mada

- MD in talks with SBI for loan to fund VRS of 700

MD of Mineral Area Development Authority (Mada) Ravindra Singh has been meeting state finance secretary Amrendra Pratap Singh over the last two days to speed up restructuring of the oldest, but cash strapped, civic body of Dhanbad.

Established in 1984 after the merger of Jharia Mines Board and Jharia Water Board, Mada is now entrusted with the task of supplying water to more than 15 lakh residents of Jharia and Katras circles, besides looking after sanitation and cleanliness of the two areas.

A finance department clearance is necessary for the government to place the Mada restructuring issue in the upcoming monsoon session of the Assembly so that necessary amendments can be made to Jharkhand Municipality Act, 2011.

The Act mandates that no area can be serviced by two civic bodies, in this case, Dhanbad Municipal Corporation and Mada. Hence, the need for changes to the Act.

“We are completing the required home work with regard to restructuring so that the amendments can be brought about,” MD Singh told The Telegraph.

“Last week, we met officials of SBI Cap in Ranchi for seeking a loan of around Rs 200 crore for executing a restructuring plan,” he added.

The state government initiated steps for the merger of Mada with Dhanbad corporation immediately after the act came into being, but was held back by several practical difficulties like Mada’s debts with several government institutions like the power board, difficulties in evaluating assets and its massive workforce.

At 1,800 employees, Mada has nine times more staff than Dhanbad corporation which has around 200 employees.

A high-powered committee, constituted by the state government to look into the issue, concluded that the merger of Mada with Dhanbad corporation wasn’t feasible.

It recommended that efforts be initiated for restructuring Mada, a huge financial challenge in itself.

On the table is offloading around 700 MADA employees by offering them VRS for which a loan is being sought.

“We have provided details regarding assets, liabilities, employee strength, working area, etc, to SBI officials. They will now assess the viability of the idea and prepare the restructuring plan,” Singh said.

SBI Cap, he added, could provide the loan on its own or act as an intermediary with the other banks that provide the loan to Mada which was ready to pay consultancy fees to the bank.

“We are expecting some concrete results during the second round of meeting with SBI Cap officials next week,” he said.