Will India ever have truly Smart Cities?

By Disha Rawal

Smart Cities Mission was a hugely refreshing announcement for a lot of people, including me. It gave hope that the disorganised, heavily congested, alarmingly polluted and generally uninspiring cities we inhabit are going to get an intelligent and sleek makeover. More than two years down the line, the data tells a dismal story. Of the ?9,860 crore granted to 60 cities chosen for the ambitious Smart Cities Mission (SCM), only about 7% of the funds have been ploughed into projects so far, much to the chagrin of the Ministry of Housing & Urban Affairs.

Ahmedabad is leading the list, having used the maximum amount, i.e. ?80 crores out of the ?196 crore released to each chosen city, followed by Indore, Surat and Bhopal. Andaman and Nicobar, Ranchi and Aurangabad are trailing at the bottom of the list. Amid the high expectations pegged on the project, as a trigger to innovation and economic efficiency, these figures demand close attention.

How is this programme supposed to work?

The promise of ‘smartness’ lies in the processes. The ?196 crore grant is but an instalment of the total amount of ?500 crore that has to be allocated to each of the proposed smart cities by the Central government. What makes this grant system different is that it has to be channelised through a specialised company, instead of the existing tiers of bureaucracy. This is called a Special Purpose Vehicle (SPV), which will be an incorporated company headed by a government-appointed bureaucrat. The company will be owned jointly by the Centre, the state government and the urban local bodies. This is certainly a departure from the traditional, politically vulnerable channels of project implementation.

Why isn’t the mission delivering results?

Two of the top three polluted cities in India are on the smart cities list. Agra, another city on the list, is scrapping its premium bus services due to losses. Are these cities really becoming smarter? A Housing and Urban Affairs Ministry official recently admitted that the ministry is concerned with the speed of project implementation. The ministry further said that the impact of projects that are underway will be apparent, from mid next year- which means that the citizens will receive benefits after three years of the mission commencement.

The implication of this is that either the cities haven’t started projects, or projects aren’t being implemented. There are several reasons behind these delays. Firstly, government permission is needed for projects costing anything upwards ?50 crore. This puts the entire project back in the loop of government processes. Secondly, the lack of qualified staff with the SPVs is also a major hindrance.

The working of the new institution

According to Urban Development Department additional chief secretary Mahendra Jain, there exist “problems related to the delegation of powers”. This statement requires careful examination. The development of cities has been constitutionally entrusted to municipal bodies. The SCM essentially takes executive functions away from the municipalities and hands them over to SPVs. If the reason behind this is that these bodies suffer from a mismatch of funds and functionaries, then we ought to ponder over this issue and remedy it to make municipalities a viable channel of development. Already, local governance suffers from a major overlap of institutional agents of development.

Moreover, do the SPVs have an adequate incentive to work efficiently? While a municipality is aware that its work will be assessed in the next elections, the CEO of the SPV has a fixed tenure, and the companies are supposed to exit the project as soon as they cover their capital costs. The government acts as a promoter to these companies. What seems missing is a clear incentive system tied to actual progress.

Kicking plans into action

Media attention can serve to nudge authorities to act. Two cities of Gujarat, Ahmedabad and Surat have led project implementation. Gujarat, in the wake of the recent elections and being the Prime Minister’s home state, receives ample attention from all quarters of civil society.

Another factor which needs attention in this narrative is innovation. Innovation is spurred by interlinks between universities, companies and the government which is actively engaged with citizen bodies and their grievances. International coverage of ‘smart cities’ always evaluates the innovation quotient associated with the projects. Thus to have smart cities, we need a potent mix of commercial and technological intelligence. This has to be factored in the initial stages of project implementation.

Private companies are moved by the profit motive to deliver innovative, high-quality results. Companies like Intel and Microsoft have pioneered various urban development projects across the world. Closer home, the DLF- National Highways Authority of India partnership has given a turnaround to the city of Gurgaon by constructing a road and underpass network connecting its commercial and residential areas. Thus, a strong private presence right from the developmental stage may help lend professionalism and efficiency to Smart Cities Mission projects.


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