AHMEDABAD, July 20: Ahmedabad Municipal Corporation (AMC) is poised to become the first civic body in the country to float Rs 100-crore bonds to partially finance its unique Rs 325-crore slum improvement partnership (SIP) project. The project will be implemented in a period of seven years. The proposal has been sent to Securities and Exchange Board of India (SEBI) for clearance and to stock exchanges of Delhi, Mumbai and Ahmedabad for registration.

According to sources, the bonds will come up for subscription by mid-August, subject to SEBI clearance. The corporation's lead manager, Infrastructure Leasing and Financial Services (ILFS) has finalised the prospectus.

"As this is the first-ever bond to be issued by any municipal corporation in the country we are going ahead with great caution,'' said a source.

For other civic bodies in the country, the AMC bond is going to be the trend-setter, he said.

The source said the merchant bankers have been shortlisted, so also the quantum of bonds for public and private allotments. The interest rates and other details have also been worked out.The slum improvement project is aimed at rehabilitating nearly 3 lakh families, mostly living in slums or chawls, through a self-financing project to improve their physical as well as economic condition, including housing, drinking water, sewer, solid waste management etc.

As per the project proposal, AMC will contribute 33 per cent cost of the physical developments and 70 per cent of community development.

A pilot project involving 181 households has already been successfully completed, in collaboration with NGOs like Self-Employed Women's Association (SEWA) and SHARDA (sponsored by Arvind Mills) and SAATH, at Sanjaynagar in the city on 20,871 sq metres of land, populated by vegetable vendors, semi-skilloed labourers and some salaried class people.

While each household paid Rs 2,000, matching amounts were given by AMC and Arvind Mills. The SEWA Bank helps women members to get bank loans.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.