As the 2025-26 financial year draws to a close, the Municipal Corporation of Delhi (MCD) finds itself buried under a staggering liability of ₹15,592 crore — the highest among major civic bodies in the country, showed a report submitted to lieutenant governor Taranjit Singh Sandhu during a recent review meeting.
More than half of this burden (53%) comprises loans from the Delhi government, followed by internal loans (21%), dues to employees such as retirement benefits (19%), and pending payments to contractors for executing infrastructure projects (7%), according to data submitted to the LG.
The scale of the liability becomes sharper when compared to other major municipal bodies in the country, shows the report. Hyderabad is a distant second with liabilities of ₹4,706 crore, while Bengaluru has liabilities of ₹2,100 crore, Ahmedabad ₹1,190 crore, and Mumbai ₹100 crore.
“MCD serves the largest population — of around 2.26 crore — among its peers but it operates with a budget of ₹17,000 crore, which barely a fifth of the Mumbai Municipal Corporation’s budget of ₹74,427 crore. MCD also has one of the lowest per capita revenues in the country,” the report to the LG said, citing data from state budget documents.
A municipal official said the Delhi civic body covers an area of 1,397km with a population of 2.27 crore, while its revenue is just ₹9,423 crore and per capita revenue is ₹4,712. Mumbai, in comparison, has a revenue of around ₹33,000 crore and per capita revenue of ₹26,400, the report adds.
A breakdown of MCD’s revenue sources shows that in 2025-26, transfer duty and property tax were the two primary sources of revenue for the corporation.
In 2025-26, MCD earned ₹3,495.5 crore (35.64%) from transfer duty; ₹2,915 crore (29.72%) from property tax, ₹1,026.89 crore (10.47%) from electricity tax, ₹833.99 crore (8.50%) from toll tax, ₹362.48 crore (3.7%) from advertisements and the rest from minor sources such as parking fee, licence fee, and construction permits, among others.
“Nearly half (49.96%) of the MCD revenue comes from transfer duty and electricity tax, which are collected by other agencies and subsequently transferred to the corporation,” the report adds, underlining the civic body’s limited fiscal autonomy.
Chief minister Rekha Gupta, in the 2026-27 budget presented on Tuesday, raised the allocation for the MCD to ₹11,266 crore — ₹729 crore higher than the previous year — besides announcing an additions ₹1,000 crore for colony roads under various schemes and ₹204 crore for pollution control measures by the civic body.
An MCD official said the civic body needs structural changes to improve its finances. “Over the past year, the corporation has proposed several structural reforms, including reducing the Delhi government’s collection charge on transfer duty from 3% to 0.25%, releasing ₹430 crore pending under the Third Delhi Finance Commission, and extending central capital investment support to civic projects,” the official said, adding that loan waivers from the Delhi government too could provide immediate relief.
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