PMC Diverts Merged Villages' Water Funds to Old City Project

Residents of Pune's 32 merged villages have a fresh reason to be frustrated with the Pune Municipal Corporation (PMC). The civic body has diverted ₹24 crore allocated for the development of newly merged villages to an old city water supply project, raising concerns over delays in rural area development and civic fund allocation priorities. The move has been cleared administratively, but it has reopened an old wound for people living in areas that were brought into PMC limits in 2017 and 2021.

What makes the decision sting more is that it isn't the first time this has happened. Last year too, funds meant for merged villages were diverted, leading to strong public criticism, and at that time PMC had promised not to touch these allocations again. A similar pattern played out in the 2024-25 budget cycle as well, when ₹38.50 crore from PMC's budget, originally allocated to improve water supply and roads in underdeveloped villages, was diverted to Baner, Balewadi, and Sus — areas that are already relatively developed. That reallocation had already exposed the same fault line: it negatively impacted underdeveloped regions and exposed the developmental imbalance in the city.

On the ground, the frustration is tangible. The finance committee has already approved this latest diversion, but residents from the merged areas argue that the civic body collects higher taxes from them without providing essential services, and continue to complain about poor roads, irregular water supply, weak electricity arrangements, unscientific waste management, and serious sewage problems. Many feel their long-pending projects keep getting pushed further down the priority list, and the pattern has left them questioning whether the administration genuinely intends to fix these gaps or is simply managing optics year after year.

The scale of the underlying problem is significant. Pune's civic limits have grown dramatically over the years — the civic area expanded from 125 sq km in 1987 to 508 sq km in 2021 — but service delivery hasn't kept pace. Several newly merged villages still lack adequate drinking water, sewage systems and storm-water drainage. Frustration over slow development has even pushed some areas to break away entirely: Uralikanchan (Uruli Devachi) and Fursungi demanded separation from PMC and were later approved to form an independent municipal council.

There is, however, a more optimistic side to the story that homebuyers evaluating properties in these areas should track closely. PMC's own 2026-27 budget signals a much larger push toward fixing this imbalance. PMC's ₹13,995 crore Pune Budget 2026-27 prioritises road development, water supply and civic infrastructure upgrades in newly merged villages, and is ₹1,377 crore higher than last year's budget, reflecting the increasing demand for infrastructure development in the rapidly expanding city. Separately, the civic body has made a revenue provision of ₹1,274.65 crore and a capital provision of ₹2,077.43 crore for water supply-related works in the same budget cycle.

Bigger external funding is also being lined up. PMC plans to undertake large-scale infrastructure development works in Pune's merged villages with financial assistance worth nearly ₹2,000 crore from the World Bank, the Central Government, and the Maharashtra Government, with the proposed projects focusing on improving drinking water supply, sewage pipeline networks, sewage treatment plants (STPs), roads, and stormwater drainage systems in newly merged areas of the city. On the ground, water supply projects are already underway in areas including Shewalewadi, Mahalunge, and Wagholi, with works expected to be completed within the next two years.

The Centre has also stepped in with a sizeable commitment. The Central Government has sanctioned infrastructure projects worth ₹1,290 crore for Pune under the Urban Challenge Fund, bringing major relief to residents of 12 merged villages facing unsafe drinking water and recurring flooding issues. Of this, ₹890 crore is earmarked for a water supply project covering 12 villages including Khadakwasla, Nanded, Nandoshi, Suncity, Kirkatwadi, Dhayari, Narhe, Jambhulwadi, Kolhewadi, Mangadewadi, Nimbalkarwadi, and Bhilarwadi, with the aim to provide clean drinking water to around 7.78 lakh residents in these areas by 2052 through the upgraded infrastructure.

For homebuyers, this tug-of-war between fund diversions and fresh capital commitments matters directly. Localities like Wagholi, Mahalunge, Dhayari, and Narhe sit at the heart of both the problem and the promised fix, and property decisions here should factor in near-term civic gaps alongside the multi-year infrastructure pipeline now backed by state, central, and multilateral funding. Buyers evaluating homes in Pune's merged villages would do well to track DPR timelines and budget utilisation reports before finalising a purchase, since on-ground execution has historically lagged behind budget announcements in these areas.