The report says that the finances of municipal corporations and urban local bodies have deteriorated.There has been lack of funds from the state governments during the second wave of COVID-19.
The revenue of 70% of municipal corporations declined.43% of the participants of the survey said that they used grants from the state governments.
Around 19% reported that they used reserve funds to meet the resource gap.6% of the corporations borrowed from state government. 2% of the corporations borrowed from banks
RBI suggests that there is a need to increase financial autonomy of the civic bodies. It is essential to strengthen the governance structure of the civic bodies.The State Governments should set up the State Finance Commissions at regular intervals in order to prevent such losses in the future.
