Business Today

The urban century

Some 590 million will live in Indian cities by 2030— about three-fourths more than in 2008. Massive and urgent changes in governance, funding and planning are needed to ensure that they live a good life.

Puja Mehra | Print Edition: May 16, 2010

Mahatma Gandhi's words that India lives in its villages are still a truism. But the accelerating pace of urbanisation suggests that, much before the close of this century, India will indeed live in its cities. Going by current trends, 40 per cent of India's population will be living in urban areas by 2030. That's 590 million people in concrete jungles, as against 340 million in 2008 and 220 million in 1991.

The question is not whether these many people will actually find themselves in the cities—but how they will live or whether they will be able to live at all. Already, India's urban landscape, barring a few well-kept, pampered conclaves such as Lutyen's Delhi, is unpleasant; the deficit of urban infrastructure dehumanising. Village-focussed India has hardly made any space for cities on its national agenda. Although cities generate 80 per cent of all taxes, less than one per cent of this gets ploughed back into urban infrastructure.

The neglect and deteriorating quality of living standards haven't deterred millions of villagers from thronging to cities and towns in pursuit of economic prosperity—after all, cities account for 30 per cent of GDP. But this scramble is worsening the crisis that cities face in housing, sanitation, water supply, transport...the list is growing.

And a crisis it already is. Urban Indians get only 105 litres of potable piped water a day, against a basic minimum requirement of 150 liters, according to a McKinsey & Company report: India's Urban Awakening: Building Inclusive Cities, Sustaining Economic Growth. Only a little more than half of urban Indians have access to sewerage and septic tanks. More than 80 million Indians live in urban slums.

The demand-supply gaps for key urban services are so huge that supply needs to be increased at unimaginable rates (see charts). Consultants McKinsey reckon that India needs to build 700-900 million sq.m. of commercial and residential space every year. That is equal to two Mumbais. "Unlike rural India, urbanisation has gone on almost unnoticed," says Arun Maira, the Planning Commission's member in-charge of urban issues. "No one said: Let's do something about urbanisation."

When the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) was announced in January 2005 as the National Urban Renewal Mission, it was the first time that urbanisation got on the national agenda in a comprehensive and planned way, backed by funds. Since then, the JNNURM has been a bonanza for states willing to complete specified policy reforms, and gives cities and towns across the country equal access to funds.

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