City rankings: Analysing indices and India?s performance

By Dhruv Rawani

A few days back, the Indian media was filled with reports about the rankings of various cities around the globe given by a global real estate consultant. Mumbai, the financial capital of India, has been ranked 16 among 20 cities expensive cities around the globe. It is worth noting that Mumbai actually has fallen from last year’s rankings when it was ranked 15^th on the list. The report mentions that one can buy 92 sq. meters of area for USD 1 million in the city. The top spot was held by Monaco, the city where an F1 circuit runs through its streets.

City Wealth Index, another index in the same report, ranked Mumbai 47 in the overall list of 314 global cities, with top spots occupied by US cities. The index is derived from four factors, namely wealth, investment, future and lifestyle. The wealth index talks about the number of households having more than USD 250,000. The investment index talks about the investment in the private property market within the city, whereas the lifestyle index talks about the number of five-star hotels. The future index ranks the cities based on the forecast GDP 2022. The top spot in all the four sub-indices is held by New York whereas large US cities occupy the top ten slots on the list. The report and the institution have been very narrow in its ranking because it primarily focuses on global cities and the ultra-rich, with real estate being the common theme.

Indian cities rank in other indices

The EIU’s ‘Global Livability Ranking’ for 140 cities includes only two Indian cities, Mumbai and Delhi. As per the 2015 index, both cities fare poorly, with Delhi at 100th spot and Mumbai at 115th. The ranking is based on parameters like stability, healthcare, culture, environment, education and infrastructure. Delhi scores a high 75/100 on education, but a low 55/100 on health. On the other hand, Mumbai ranks low on infrastructure, 51/100. While Melbourne has consistently figured as the most liveable city, and Damascus in conflict-torn Syria is shown to be the least liveable as per the report.

Mercer, a workforce advisory firm, comes out with its in-house city rankings based on the quality of living. The parameters are consistent with 39 factors from 10 categories which consist of politics, economic and socio-cultural environment, health, education, public services, recreation, consumer goods and housing. The firm ranks the traditional business centres of Mumbai and Delhi at a dismal ranking of 154 and 161 respectively among 231 cities.

At Kearney, a global management consulting firm, which also carries out a survey and ranks the cities on a diverse set of parameters, uses research of cities based upon a combined reading of 27 matrices across 5 categories. The categories being, business activity, human capital, information exchange, cultural experience and political engagement. The survey ranks Mumbai at 44 among the 128 global cities.

While a direct analysis of these surveys doesn’t throw up evident conclusions, a deeper comparison of reports can lead to performance reports of Indian cities using the commonality of parameters considered. As far as the performances of the national and the financial capitals of this country are considered, it leaves no one in doubt that India is ranked somewhere in the middle irrespective of the sample size. The broad parameters can be divided into the following categories of indicators: political, civic amenities, environment, economic opportunities, housing, social and cultural.

Rankings of cities nationally

While the global institutions have their research based on Indian cities, there is no domestic comprehensive report which tracks the performance of Indian cities. Traditionally there hasn’t been any performance trackers established within India, however, the current government which strives to lay emphasis on performance has also proposed to come out with a livability index to rank 116 Indian cities. The cities would be analysed on close to 75 parameters from 15 categories which include governance, education, health safety and security, open space, water and power supply, pollution level and economic conditions. This index bears extreme significance in light of the fact that the present dispensation wishes to take a leap with the development of 100 smart cities.

The combination of qualitative and quantitative factors

Knight Frank’s report on the analysis of cities performance allows an establishment of best parts of each city. The relative better performance in the Knight Frank report of the Indian cities compared to the other reports bolsters the argument of growing divide between the rich and the poor articulately captured in the ‘The Capital’ by Thomas Piketty. Another point of consideration that arises from the above indices is the sample size. While the number of cities to be considered is to be subjective, the number in the sample needs to be drawn from a quantitative parameter, consisting of the population and economic indicators.

Leaving all the numbers aside, a ranking of the city should be based on its performance decided by its own residents. The best city would be one where a maximum amount of its residents are satisfied, therefore, it would be a sin to leave out the happiness index. The city index should be based on upon the city’s needs and wants. While the ‘needs’ such as affordable housing, low crime rates, a strong economy and accessible quality health care, are common, the ‘wants’ front, or desired comforts, are vastly different. The amenities of socio-cultural, natural and technology all need to be understood in the context of 21^st century. Demographics, a silent but consistent factor, would greatly influence them on the importance of civic amenities, transportation and infrastructure and the socio-cultural environment of a city, examples being Delhi, Mumbai and Bangalore.