PMC Rs 500 Crore Cosmos Bank Deposit and Overdraft for HCMTR Land: Rates, Objections and What Is Pending

Pune, 9th November 2026: The Pune Municipal Corporation (PMC) wants to place Rs 500 crore as a fixed deposit in Cosmos Co-operative Bank and then borrow up to 95 per cent of it as an overdraft, to pay for land for the High Capacity Mass Transit Route (HCMTR).

The Standing Committee has cleared it in principle, but no final decision has been taken.

Congress corporator Arvind Shinde has objected and threatened to go to court.

How the Cosmos Bank deposit and overdraft would work

According to the proposal reported by Civic Mirror:

• PMC deposits Rs 500 crore for 16 months at 7.40 per cent a year, with interest paid every quarter.
• It can then draw an overdraft of up to 95 per cent of the deposit, at 7.70 per cent a year.
• The money is meant for land acquisition on the HCMTR.

Ninety-five per cent of Rs 500 crore works out to Rs 475 crore. The Free Press Journal put the overdraft at about Rs 450 crore, so the final amount depends on terms not yet fixed.

The gap between the two rates is 0.30 percentage points. On paper, PMC pays slightly more on what it borrows than it earns on the deposit.

Who approved it, and when

Civic Mirror reported that Cosmos Bank sent its proposal on 29 September 2026. Municipal Commissioner Naval Kishore Ram wrote to the Standing Committee on 30 October after a meeting at the District Collector’s office.

The Standing Committee approved the idea by resolution on the same day it was tabled. Shinde says it came as an urgent item, not through the regular agenda.

What PMC says in favour of the deal

Commissioner Ram told The Free Press Journal that banks are reluctant to lend for land acquisition, and those that do charge more. He said the deposit earns over 7 per cent and stays secure.

Standing Committee Chairman Shrinath Bhimale said Cosmos offered a comparatively low rate. He said the HCMTR land needs about Rs 1,000 crore, and that the proposal will be discussed again with the commissioner before a final call.

The objections raised by Arvind Shinde

• Why was no expression of interest invited from other banks, including the Pune District Central Co-operative Bank?
• Why borrow at all when, he says, PMC already holds fixed deposits of about Rs 8,500 crore?
• Has anyone checked the bank’s financial health, credit rating and risk before putting public money in it?

Civic Mirror also noted that PMC normally keeps deposits in nationalised banks and in HDFC and ICICI, so a co-operative bank would be an exception. Opposition members have alleged political pressure behind the choice, which PMC has not addressed in the reports we checked.

What the HCMTR is, and why land is the hurdle

The HCMTR is a planned ring of elevated road and transit around central Pune, first proposed nearly 40 years ago. PMC plans to start work on two stretches: Sinhagad Road to Lullanagar and Viman Nagar to Bombay Sappers, as reported by The Bridge Chronicle in September.

Much of the alignment passes private land, which has to be bought before construction. PMC has already approved Rs 3,722 crore for land acquisition for the HCMTR and the inner ring road.

For other big road projects, see our Pune Ring Road status story. More civic finance news is in Pune Civic.

What is still not decided

The borrowing amount, the duration and the final interest rate are not fixed. No timeline has been given for the next discussion. We will update this story when PMC takes a final decision or if the matter reaches court.

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