MIDC Faces ₹51,000 Cr Debt Amid Political Project Push.

Unmesh Gujarathi
Sprouts News Exclusive
Contact: +91 9322755098

MIDC is facing a financial crisis with liabilities expected to cross ₹51,000 crore in two years, driven by politically pressured non-industrial projects like zoos and old age homes. A Sprouts News Special Investigation Team (SIT) probe reveals mounting debt, urgent need for loans, and diversion from MIDC’s core industrial development mandate.

The Maharashtra Industrial Development Corporation (MIDC), originally established to boost industrial infrastructure, is now facing a severe financial crunch. Due to political pressure, MIDC has increasingly undertaken non-core projects—from modernizing railway stations and ST depots to building zoos and old age homes. These off-track responsibilities are pushing the agency to the brink of unsustainable debt.

According to internal estimates, MIDC’s liabilities—currently near ₹12,000 crore—could balloon to over ₹51,000 crore in just two years. This startling escalation has forced MIDC to draft a proposal seeking state government backing for large-scale debt financing. The situation reflects a growing trend of policy drift, where industrial bodies are diverted from their primary mandate to serve politically motivated development agendas.

The Sprouts News Special Investigation Team (SIT) has found that a significant portion of MIDC’s recent workload consists of non-industrial, politically motivated infrastructure projects. These include hospital construction in Konkan, the planning of a zoo, and disputed land allocations for artists’ retirement homes—all of which fall outside MIDC’s original industrial development charter.

Such interventions have burdened MIDC’s finances. At present, the corporation has ₹7,896 crore in fixed deposits across banks, expected to yield ₹1,300 crore in interest over two years. However, ₹424 crore from this amount has already been earmarked for post-retirement employee benefits. With ongoing and proposed works continuing to rise, MIDC is bracing for severe liquidity challenges.

Key engineering and infrastructure commitments, land acquisition needs, and operational expenses are all adding up. A proposal submitted to the state government estimates that from FY 2024–25 to FY 2027–28, total liabilities may reach ₹51,468.20 crore. Despite capital inflows and projected interest income, a funding gap of nearly ₹26,000 crore remains.

Facing an unsustainable financial trajectory, MIDC has formally proposed to raise loans with state government guarantees. The plan includes appointing external consultants through a transparent bidding process to evaluate borrowing options. The proposal also seeks executive powers for MIDC’s CEO to raise loans beyond the prescribed borrowing limits, subject to state approval.

Despite repeated efforts, Sprouts News could not obtain official responses from Industry Minister Uday Samant or MIDC CEO P. Velarasu. Their silence adds to concerns surrounding transparency in the agency’s evolving debt strategy.

•For FY 2024–25 and FY 2025–26, MIDC’s engineering department has committed liabilities of ₹12,545 crore, with an additional requirement of ₹7,525.67 crore expected over three years.

•Land acquisition for new industrial zones will need ₹3,771 crore urgently, with an additional ₹17,495 crore required over the medium term.

•Revenue expenditure liabilities currently stand at ₹10,000 crore.

The Sprouts News Special Investigation Team (SIT) warns that MIDC’s increasing drift into non-industrial functions threatens the structural integrity of its funding model. Originally intended to create industrial ecosystems and generate employment, MIDC is now struggling to balance its books while serving piecemeal political interests.

Experts suggest that without immediate recalibration of its core mandate, MIDC risks becoming a vehicle for fragmented, vote-driven projects—undermining the long-term sustainability of Maharashtra’s industrial growth engine. The debt trajectory, if unchecked, could also affect private sector confidence and investor perception, particularly in a state aiming to attract high-value manufacturing and infrastructure ventures.

As MIDC’s liability load crosses dangerous thresholds, the need for a policy reset becomes urgent. Stakeholders argue that politically motivated infrastructure decisions should not be imposed on agencies created for targeted economic missions. Financial prudence, sector-specific planning, and institutional autonomy must return to the forefront of governance discussions.

Sprouts News will continue to follow this story as it evolves, tracking whether MIDC’s industrial charter can survive mounting political demands and rising debt exposure.

For detailed urban infrastructure investigations, stay with Sprouts News Special Investigation Team (SIT)—India’s trusted source for policy accountability.