Managing the dead (investments): The municipal plunge in the holy waters of Dwarka
- Chinmay Menon
- Nov 28, 2025
- 6 min read
By Anurag Anthony
The ancient city of Dwarka is located on the western tip of the Saurashtra peninsula in Gujarat, India. The city is one of the Char Dhams of the Hindu pilgrim circuit. It is associated with mythological periods having associations with Lord Krishna and has rich religious and cultural significance in the Hindu religion. Marine archaeological excavations have revealed submerged structures a few metres from the coast of Dwarka city at the mouth of the Gomti River. Dwarka has around 40,000 residents and according to the Tourist Flow Information System, it caters to nearly 4 million overnight tourists and daytime visitors every year.
In June 2015, Ministry of Urban Development (MoUD), Government of India (GoI) launched the HRIDAY Mission for 12 heritage cities in India, including Dwarka. The HRIDAY Mission has allotted INR 22 crores for heritage and civic development works in and around the heritage assets of the city. MoUD appointed Urban Management Centre (UMC) as the HRIDAY City Anchor to prepare a City HRIDAY Plan (CHP). The CHP document guides the municipality on holistic development, keeping in view the city’s heritage assets. The CHP also provides a heritage toolkit for urban elements which defines material and colour palette for development works in the heritage zones.
Over the last decade, Dwarka has received investments of worth more than INR 120 crores. The investments have provided the much-needed boost to its civic infrastructure. The city may receive another INR 50 to 60 crores through other ongoing schemes of the GoG and GoI.
Gradually, almost all assets are heading towards neglect and disrepair, repeating the build-neglect-rebuild model of development. A visit to the city would reveal the plight of most of the investments. This is true for many other cities in India. There are several reasons for the neglect of the assets built with the investment of the above nature.
1. Poor consensus building by project funders and designers
In most cases, neither did the project funders seek municipal consent for ownership of the projects nor did the designers, for design concepts and specifications. The funders and designer later on handed over their projects to Dwarka Municipality for their O&M. Obviously, due to the lack of participatory consultation, the municipality does not have any sense of ownership towards these projects and see it as a liability.
2. Disproportionate assets transferred to the municipality
The municipality does not have the financial capacity to spend on operation and maintenance (O&M) of these assets. The annual municipal budget for the year 2015-16 of Dwarka Municipality was around INR 31.59 crores, or INR 7,890 per capita. The per capita budget for the resident population is comparable to Ahmedabad at around INR 7,500 per capita. However, with a floating population 100 times the resident population in Dwarka, their budget seems dwarfed.
In a recent example, the newly developed New Gomti Ghat and Samudra Narayan Beachfront Development incurred an electricity bill of INR 6 lakh in its first month for street lighting. The municipality could not pay this bill and hence, switched off the lights. If operated regularly, only street lighting bill for these 2 projects would cost the municipality nearly 13 percent of their own income. Repair, maintenance and housekeeping costs of all the assets worth INR 120 crore would be atleast INR 6 crores or 2/3rd of the annual income of the municipality.
3. No sustainable financing of O&M expenses
A deeper look into the financial health of the ULB reveals that 69% of its income comes as state government grants. As per the Service Level Benchmarks (SLB) 2016, the cost recovery in delivery of water supply services was decent at 82%, while negligible for solid waste management at 9% only.
The annual municipal income from their own sources (tax and non-tax based) is only INR 9.28 crores (less than 30% of the total budget) which is extremely low for sustainable O&M of the above listed projects, not to forget that the municipality has to maintain their existing assets too.
These assets created in with the recent projects generate insufficient income for their O&M. While the O&M expenditure of these assets are high, the potential income from these projects is just INR 50,000 per month from the parking and advertisement rights. The O&M of Sudama Setu is entrusted with a special purpose vehicle (SPV) which collects a charge from the visitors. This is expected to generate an income of INR 25 lakh per year, which may suffice for its own O&M over the long term.
4. Lack of municipal technical capacity
The technical capacity of the municipality is extremely low. A detailed staffing assessment would reveal that the municipality is short of technical staff, may be working with just half the sanctioned posts. With the restriction on fresh recruitments imposed by the state government and poor financial health for outsourcing, the municipality cannot afford to hire facilities management contractors for operation and maintenance of the projects.
5. Lack of political will to charge for services
The municipality faces constant oppositions from their own local councillors against levy of user charges for facilities, including the Sudama Setu. The lack of political will towards sustainable O&M is adding to the neglect of these assets.
With these challenges, the assets worth INR 20 crore being created by the HRIDAY Mission face a grim future with more than INR 1 crore to be spent on O&M annually. The potential revenue sources from HRIDAY projects fulfil only 20% of the O&M requirements as revenue is projected to be between INR 15 to 25 lakhs annually, from advertisements, rent from shops, hawking permits and parking.
To counter the O&M sustainability challenge, I recommend the following.
Dwarka Municipality should rationalise their taxes, tariffs, rentals and user charges on its municipal services to achieve higher cost recovery, if not more than 100%. In addition, it should inventorise and monetise its assets such as land holdings, vending space allocation charges, advertising spaces, parking fees and introduce local development fee on the hospitality services including tourist transport, hotels and restaurants. Dwarka Municipality operates a ‘Dwarka/ Bet Dwarka Darshan Bus Service’ successfully and claims it to be sustainable, if not profitable. Lessons from such examples may be shared with other paid services in Dwarka and suitably adapted to strive towards financial sustainability.
The local administration should setup an SPV for O&M of HRIDAY, and other recently completed projects of Dwarka. The SPV may comprise the district administration, municipality, TCGL, Dwarkadhish Temple Administration and representation from local businesses and citizens. The SPV should be empowered to collect user charges/ fee from the visitors to avail the services provided by these projects. The HRIDAY Mission, unlike its contemporary missions, aka SBM, AMRUT, PRASAD, Smart Cities Mission and Swadesh Darshan should provide O&M support to the SPV for the projects until it they are able to generate sustainable revenue.
HRIDAY Mission may also create a revolving fund to enable borrowing by HRIDAY cities. This borrowing may be allowed for hosting special events/ festivals/ fairs which may generate additional income for the municipalities. The borrowing may be supported/ supplemented by respective state tourism departments.
I suggest that if feasible, the Tourism Department, GoG may contribute a share of the revenue towards O&M of assets, proportionate to the visitors to tourist destinations such as Dwarka. Likewise, the Gujarat State Road Transportation Corporation (GSRTC) may also contribute a share of their revenue from the bus fares to and from Dwarka for local development.
Dwarka Municipality may also levy a visitor charge for vehicles and individuals, similar to the environmental/ tourism/ pollution fee charged by places like Mount Abu, Mahabaleshwar and Matheran.
A detailed feasibility study should be conducted to assess the enforceability and deciding the rates for taxes, tariffs, fees and charges on each of the above recommendations. After all, the missions of the GoI and state governments are funding the development with the tax payers’ money and it is painful to see the neglect of the infrastructure created. Structural reforms like these may help in raising the dead (investments).
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