CITYZEN. Not exactly a smart idea

With a commitment of ₹98,000 crore over the next five years for two urban programmes, the contours of the Modi government’s urban strategy are beginning to emerge. The setting up of the Smart Cities Mission for 100 smart cities and the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) for 500 one lakh plus population cities, represents a continuation of the mission mode that propelled the urban strategy of the UPA government.

From the few details available, it would appear that while addressing some of the limitations in the implementation of this strategy, the basic problems with a mission approach continue to remain unchallenged.

The two missions taken together suggest a process by which State governments identify the specific projects that are needed for individual cities. Under AMRUT, the Centre then supports these specific projects by sharing its costs. These cities can then enter a competition to be recognised as a potential smart city. One in five of these cities, based on their ability to convince the Union government that they are equipped to deal with the challenge of becoming a smart city, would then get ₹100 crore to do so.

While the details do differ, the JnNURM (Jawaharlal Nehru National Urban Renewal Mission) also followed a similar approach in that States were asked to make plans for individual cities based on which projects could be identified and supported. This soon came up against two challenges. First, the programme was initially focused on million plus cities while much of Indian urbanisation lies outside these cities. Various steps were then taken to widen the net.

The Modi government has continued this process by enlarging the list to 500 cities. It could be argued that this does not go far enough as a significant proportion of Indian urbanisation is in towns of less than one lakh population, but it is a movement in the right direction.

The second challenge was in relation to the choice of individual projects. The UPA government tried to appraise projects in terms of very detailed conditions. But in practice the State government typically only chose to rewrite projects that were already on their shelves in a way that made them JnNURM-friendly. Reports suggest that the Modi government hopes to bypass this challenge by simply leaving the choice to the State governments. This decision to decentralise should at least partially address the one-size-fits-all problem of central appraisals.

The more serious problem lies in the mission approach itself. Given the fact that a mission has to look impressive, the targets that are set are usually very impressive. The UPA government struggled to find the resources to fund JnNURM on the originally envisaged scale. And when it found the resources the State governments could not always come up with their share.

There is nothing to suggest that the current initiative has overcome these problems. The finance minister’s budget for 2015-16 did not mention the kind of numbers that are now being promised. And if, as reports suggest, State governments are expected to come up with 50 per cent of the costs, the possibility of the huge sum of ₹98,000 crore not being fully and efficiently utilised cannot be brushed aside.

In the case of the Smart Cities Mission this challenge could be even more acute. The government is quite aware that ₹100 crore is grossly insufficient to make a city smart, whatever that is taken to mean. As a result the entire mission depends quite heavily on how the private sector responds to invitations to join public-private partnerships. In current conditions such partnerships would involve commitments to higher prices. And high-priced infrastructure would completely remove any low-cost advantage a potential smart city may have. A city that is hoping to meet the global demand for low-cost manufacturing could find itself severely hurt by any high-cost attempts to look smart.

The greater difficulty with the mission approach is its operation through individual projects that are chosen by State and, preferably, local governments. Such a choice of projects, even when it is efficiently made, would reflect primarily local concerns. But the larger challenge of urbanisation in India is that it is to a significant degree a nationwide process.

To take just one element of this process, a significant portion of the demand for labour in the cities of South and West India is met by workers migrating from the North and East. Often this migration is seasonal. An effective strategy to manage this component of urbanisation would have to include low-cost railway linkages. Such actions are clearly out of the purview of State governments, let alone city governments.

The problem with the mission approach, whether of the UPA or the NDA variety, is that it focuses entirely on the supply of grand infrastructure projects in individual cities, ignoring the demands of the larger process of urbanisation.

The author is a professor at the School of Social Science, National Institute of Advanced Studies, Bengaluru