Uttar Pradesh is poised to become the first state in India to have five municipal corporations listed on the stock exchange, with Varanasi preparing to launch its municipal bond. This development is set to place the state ahead of Maharashtra and Gujarat in terms of municipal bond activity, according to an official statement from the government.

The government under Chief Minister Yogi Adityanath has been at the forefront of promoting municipal bonds as a strategic tool to finance urban infrastructure while reducing dependence on state resources. The initiative began in November 2020 when the Lucknow Municipal Corporation raised ₹200 crore—marking a revival of municipal bonds in the country after a gap of 23 years. This was followed by successful bond issuances from Ghaziabad, Agra, and Prayagraj, with Prayagraj’s bond notably being oversubscribed by 4.4 times, reflecting growing investor confidence.

The capital raised through these municipal bonds is being channelled into critical urban projects such as roads, water supply, sewerage systems, and street lighting. These projects are enhancing the quality of life for citizens while stimulating economic growth and attracting further investment, the statement added.

With Varanasi’s impending bond issuance, Uttar Pradesh’s tally will rise to five municipal corporations out of the 19 currently listed across the country. Experts view this as a forward-looking and sustainable financing model, particularly effective for tourism-driven cities like Prayagraj and Varanasi.

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Officials highlighted that the state’s policy framework has empowered municipal bodies to tap into capital markets, enhance fiscal transparency, and move toward self-sustaining urban governance. With this trajectory, Uttar Pradesh is emerging as a national frontrunner in innovative urban finance.

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