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Objectives of the Trust

I. To give financial and other assistance to Urban Local Bodies, Statutory Boards and Departments, Public Sector Undertakings and Private Investors or setting up infrastructure projects in the State of Odisha as per the guidelines issued by the Trust. The ultimate goal of the trust is to become financially self-sustainable and facilitate debt financing of Urban Infrastructure Projects in Odisha in a Non-guaranteed mode.

II. To borrow or raise moneys or loans or receive grants or accept contributions for the above purpose in such manner and on such terms, conditions and securities as the Board of Trustees in their discretion deem fit from time to time.

III. To guarantee the performance of any contract or obligations and the payment or money or dividends and interest on any stocks, shares or securities of any company, corporation, firms or person in any case in which such guarantee may be considered directly or indirectly to further the main objects of the Trust.

IV. To subscribe for, underwrite, acquire, hold and dispose of shares, stocks, debentures, debenture stocks, bonds, mortages, obligations, securities of any kind issued or guaranteed by any company (body corporate or undertaking) of whatever nature and industry, Government, Trust, Municipal, Local Authority or body of whatever nature as may be conducive to the objects of the Trust.

V. To invest any money of the Trust not immediately required, in any investment as may be thought proper and as may be necessary.

VI. To do all other things necessary and conducive to the attainment of all these objectives.

Need for a Nodal Urban Financing Framework:

Odisha's consistent economic performance is expected to hasten the pace of urbanisation, creating unprecedented demand for urban amenities and services. At the same time, the improving fiscal situation provides the State Government with an unique opportunity to create an Urban Financing Institutional Framework to support this urbanisation in a planned manner. The increase in budgetary outlays for urban sector and visible reforms reaffirms Government of Odisha's (GoO) commitment to address urbanisation in a planned manner.

However, a number of constraints have impeded structured and systematic development and financing of urban infrastructure. Traditionally, municipal finances have been weak; capital investments have largely been dependent on GoO's budgetary outlays / grants. Debt financing has been limited to State supported projects. Weak financial and operational capacity at local levels has further constrained conceptualisation, development, financing and implementation of Urban Infrastructure Projects. The imperatives that emerge from the prevailing urban context in Odisha include:

  • Wider reform and capacity building to facilitate greater Government devolution and revenue buoyancy at ULB level.
  • Focused Project Development, to translate macro-level investment requirements into well-structured projects to deliver citizen level impact and benefits.
  • Effective leverage and access to external financing, including private capital, to address capital investment requirements through well-structured projects in a time-bound manner.

With his backdrop "Odisha Urban Infrastructure Development Fund (OUIDF)" came into existence as Trust under the Housing and Urban Development Department (HUDD) with assistance from KfW (Germany's Development Bank). The ultimate goal of the OUIDF is to link ULBs to the capital markets by functioning as a sustainable intermediary. The OUIDF seeks to;

a) Catalyze development of well-structured pool of bankable projects,
b) Build capacity in project appraisals and resource mobilization and
c) Spur institutional reforms as a pre-requisite for external financing.

Envisaged Benefits:

Integrated approach to urban development:

  • Access to fixed, low interest long-term funds and technical assistance to build expertise in implementing 'bankable' projects
  • Combination of Government oversight and professional efficiency
  • Scalability: Allows managing multiple funds and leveraging of other funds
  • Introducing ULBs to rigor of debt servicing discipline.
  • Facilitating access of ULBs to external finance and capital markets
  • Greater scope for private sector participation in asset creation and service delivery