Mumbai: With the state government reeling under fund crunch and mounting debt burden, various government departments have started exploring options to raise money beyond resources allocated in the state budget.
The forest department, among them, is planning to monetise its teakwood property to avail a ₹6,000-crore loan, while the water supply department is looking to raise ₹15,000 crore from from the Housing and Urban Development Corporation (HUDCO) and the public works department is clearing pending dues of road and infrastructure contractors with a 4% cut via the Trade Receivables Electronic Discounting System (TReDS).
Pressure mounted on state finances in 2024, when the previous Mahayuti government announced a slew of sops ahead of the assembly polls. In the 2025-26 state budget, the revenue deficit was pegged at ₹45,892 crore while the fiscal deficit was ₹1,36,000 crore, even as ₹36,000 crore was allocated for the Ladki Bahin scheme and ₹14,700 crore towards free electricity for farmers. The government had to table supplementary demands worth ₹1.44 lakh crore on three occasions during the fiscal year.
Sources in the state government said more than 25,000 water supply projects were stalled as the central government had denied Maharashtra funds for the Jal Jeevan Mission. The department has now decided to avail a loan of ₹15,000 crore from HUDCO and route the money to projects that are at least 75% complete.
“We will raise money from HUDCO in a phased manner,” said water supply minister Gulabrao Patil. “We are thinking of raising ₹5,000 crore in the first phase and the money will be used for projects which are at least 75% complete.”
Faced with a similar crunch, the forest department is looking to monetise teak wood property worth ₹12,000 crore created by the Forest Development of Corporation of Maharashtra Ltd (FDCM). Last week, forest minister Ganesh Naik admitted that the government was under financial strain due to the burden of various schemes like the Ladki Bahin Yojana.
“I will present a proposal soon to the state government regarding taking a ₹6,000-crore loan based on teakwood property worth ₹12,000 crore. I hope the cabinet will approve it,” said Naik. “After all, what is the use of this teakwood if it does not enable the department to carry out various works?”.
The PWD, which owes around ₹22,000 crore to various contractors, is also working on a mechanism to expedite payment of arrears. The department has opted for the TReDS platform to clear dues of contractors with a 4% cut.
Milind Bhosale, president, Maharashtra State Contractors’ Association, said PWD officials recently held a meeting with various road and infrastructure project contractors regarding TReDS, and promised to pay around ₹5,000 crore towards pending dues soon.
“Contractors are thinking about it as they will have to accept a cut of over 4% in bills towards payment of interest.” Bhosale said.
The skill development department is also trying to raise ₹4,000 crore from the Asian Development Bank (ADB) for the Mahadrishti skill development project. This project aims to provide modern skill training as per industry requirements, particularly in rural and remote areas.