Choosing The Smart Cities Is Easy, But Implementing Change Will Be The Challenge

The NDA government will complete the process of selecting 100 cities that will be developed into smart economic hubs before 2017 ends, under its ambitious program to transform India’s urban landscape. Sixty cities have made the cut so far after the program launched in June 2015. The smart cities chosen will have to develop the smart infrastructure with 24×7 power and water supply, IT-backed efficient public transport, e-governance facilities, and sewage disposal system.

But the work has begun at a snail’s pace with just 3.3 percent of the 731 approved projects built so far. Building physical infrastructure will be the lighter part of the government’s ambitious, smart city mission. The urban sector experts said the real challenge would be to put the institutional mechanisms in place to improve the municipal governance and to ensure efficient service delivery if their cities have to become smart.

Currently, a majority of the Indian cities have abysmal service delivery standards with weak infrastructure, mainly on account of lack of ability of municipalities with the closest governance system to citizens to undertake the reforms and garner resources.

Smart Cities

The Smart cities chosen will have to develop the smart infrastructure with 24×7 power and water supply, IT-backed efficient public transport, e-governance facilities, and sewage disposal system

The study by a Brookings India compared three smart-city picks Vizag, Ajmer, and Allahabad has shown the minimum amenities needed for a city to be turned into a smart city, with nine other metropolises across Asia, Africa, and Latin America which are having the similar demographic and economic traits. The report released last year has also found the cities lagging behind on almost all counts like personal wealth, access to necessary facilities such as piped water, electricity and toilets.

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Dr. Shamika Ravi, the senior fellow, governance studies program, Brookings Institution said that the general view of the smart cities is narrow and limited to IT, digital solutions. But if we were to take lessons from the previous federally driven city efforts, the smart city mission could only reach its objective if it focuses on specific technologies and more on governance reforms, economic goals, and sustainable capital flow. It is to note that she is the principal author of the report.

According to McKinsey Global Institute report, 2010, India’s per capita spending of $17 on the urban infrastructure is just 14 percent of China’s $116. The 14th Finance Commission report says that the municipal revenue accounted for a little over 1 percent of GDP in India in 2012-13. That is much less than the emerging economies like Brazil and South Africa, where it was 5 percent and 6 percent.

Srikanth Viswanathan, CEO, Janaagraha said as quoted “Putting in place, the smart city systems would be the first need of the hour. It comprises spatial development plans, empowered mayors and councils, municipal finances and talent, and transparency and citizen participation.”

Unlike London or New York, India does not have a directly elected mayoral system with much more empowered city governments. A majority of the states have mayors elected by the municipal councilors. The 74th constitutional amendment act provides for the transfer of 18 powers to the Urban Local Bodies (ULB), that includes electing the mayor directly for five years, urban planning, and levying taxes. But the states, fearing that their power would be diminished, have implemented the reforms patchily.

Smart Cities

The report released last year has also found the cities lagging behind on almost all counts like personal wealth, access to necessary facilities such as piped water, electricity and toilets.

On supporting the mission, each of the selected cities has to set up a corporate-style Special Purpose Vehicle (SPV) that is mandated to implement the projects. Junaid Kamal Ahmad, the World Bank’s country director, has said that the challenge for India is in designing the SPV.

Ahmad cited Johannesburg to illustrate his point as quoted “If you create an SPV to be a parallel system, it would be a parallel system, if you design it to be a service-delivery arm which feeds the municipality, or that would support the municipality, then it’s an altogether different story.” The South African city’s mayor is running six or seven SPVs, and each one of them acts as a corporate delivery machine. Hence water, electricity, solid waste, IT, almost everything has been put in the SPVs.

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He also said that they are running under company laws with a full governing board. They have got duties for both the investment as well as for the running operations, and they can manage operations directly, but they are accountable to the city. And there is a Memorandum of Understanding (MoU) between the city and the SPV,” ha added.

Out of the total expense of Rs 131,000 crore approved for smart cities, Rs 60,000 crore would come from the central and state governments. Rest has to come from other sources, which includes private investments and the municipal bonds.