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The Telangana government has decided to take over nearly INR 5,000 crore debt of the Greater Hyderabad Municipal Corporation (GHMC), providing major financial relief to the civic body. The debt, largely raised for infrastructure projects like flyovers, roads and drainage systems, had been putting pressure on GHMC’s finances due to high monthly repayments. The move also removes earlier uncertainty around sharing liabilities with newly formed municipal corporations and is expected to improve financial stability, allowing GHMC to focus more on civic services and ongoing development work.
The Telangana government has stepped in to take over debt of around INR 5,000 crore from the Greater Hyderabad Municipal Corporation (GHMC), aiming to reduce the financial burden on the civic body and improve its ability to manage day-to-day operations. The decision was taken after reviewing GHMC’s financial position, including its outstanding liabilities and repayment commitments. Advertisement
The debt had been accumulated over several years, mainly to fund large infrastructure projects across Hyderabad. These include flyovers, underpasses, major road works, and stormwater drainage systems developed under key programmes such as the Strategic Road Development Programme (SRDP) and the Comprehensive Road Maintenance Programme (CRMP). These projects were taken up to improve traffic flow and urban infrastructure but required significant borrowing.
GHMC’s total outstanding liabilities were estimated at around INR 4,800 crore to INR 5,000 crore. The civic body has been paying close to INR 180 crore every month towards loan repayments, including both principal and interest. These repayments were being made through internal revenues such as property tax collections, user charges, and other municipal income, which put pressure on its ability to fund routine civic services.
In the past, GHMC had raised funds through a mix of municipal bonds, loans from financial institutions, and other borrowings. A substantial portion of its annual revenue—estimated at around INR 700 crore was being used only for servicing debt. This limited the corporation’s financial flexibility, especially at a time when demand for urban infrastructure and maintenance continued to rise.
Earlier, there were discussions on dividing this debt among GHMC and the newly proposed municipal corporations such as Cyberabad and Malkajgiri, based on where the infrastructure projects were located. However, the state government has now decided to take full responsibility for the entire debt, avoiding complications in allocation and ensuring a smoother administrative transition.
This decision also follows earlier concerns raised by GHMC officials regarding pending dues from the state government, which were estimated to be between INR 5,000 crore and INR 5,500 crore. The civic body had indicated that clearing these dues or taking over the debt would help it manage its finances better and continue development work without disruptions.
With the state assuming the liability, GHMC is expected to get immediate financial relief. This will allow the civic body to redirect funds towards essential services such as road maintenance, sanitation, and local infrastructure upgrades. It also strengthens the financial position of the newly formed municipal corporations by keeping them free from legacy debt.
The move is part of the state’s broader approach to manage public debt more effectively by consolidating and restructuring high-value liabilities. It is expected to reduce repayment pressure in the short term and improve financial planning for urban local bodies.
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