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The International Finance Corporation (IFC), a member of the World Bank Group, has committed up to USD 60 million (about INR 498 crore) to the Greater Visakhapatnam Municipal Corporation (GVMC) through rupee-denominated non-convertible debentures. This marks IFC's first direct municipal financing in India without a sovereign guarantee. The investment will support the Madhurawada Sewerage System Project, with a total cost of INR 553 crore, combining contributions from the central government and GVMC. The initiative is expected to improve sanitation, protect the coastline, and strengthen municipal creditworthiness.
The International Finance Corporation (IFC), part of the World Bank Group, has committed up to USD 60 million (about INR 498 crore) in rupee-denominated non-convertible debentures to the Greater Visakhapatnam Municipal Corporation (GVMC). A formal agreement was signed at the Andhra Pradesh Secretariat, marking IFC's first direct municipal financing in India. Advertisement
This funding is notable as it is the first time a development finance institution has invested directly in an Indian city without the backing of a sovereign guarantee. According to a joint statement, the initiative highlights how financially disciplined and progressive urban local bodies can access global capital markets for essential infrastructure development.
The financing will support the Madhurawada Sewerage System Project, aimed at strengthening sanitation infrastructure in one of Visakhapatnam's fastest growing regions. The project carries a total cost of INR 553 crore. Of this, the central government will contribute INR 45.64 crore under the Atal Mission for Rejuvenation and Urban Transformation (AMRUT), while GVMC will provide INR 9.36 crore from its internal accruals.
Andhra Pradesh's Principal Secretary for Municipal Administration and Urban Development, S Suresh Kumar, stated that the government's vision is to build a cleaner and healthier Visakhapatnam while setting an example for other cities seeking to modernise through global-standard financing and governance.
IFC's Managing Director Makhtar Diop underlined that the partnership with Visakhapatnam demonstrates how municipalities can attract private capital to deliver affordable and sustainable services such as wastewater management, sanitation, transport, and solid waste handling without relying on sovereign guarantees. He also noted that the project would help safeguard the city's coastline, generate jobs, and establish a model for low-carbon, resilient urban development.
The collaboration is expected to set a new benchmark for municipal financing in India. It reflects the growing recognition that well-managed cities can directly tap international funding to meet infrastructure needs. IFC highlighted that such initiatives could inspire other urban centres globally to invest in cleaner and future-ready urban spaces.
Source PTI
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