Pages

19 February 2015

Smart cities require smart planning

Charan Singh & Tarun Mittal
Feb 19 2015 

THE Government of India has signed an agreement with the US to develop Ajmer, Allahabad and Visakhapatnam as smart cities during the recent visit of President Barack Obama. Earlier, an agreement with Japan to develop Varanasi as a smart city was signed in August 2014. Thus, India is fast moving into developing smart cities that will help boost growth in the country.

Emerging market economy

India with a population of 1.2 billion people is one of the fastest-growing emerging market economies of the world. With 31 per cent of urban population growing at an annual rate of about 3 per cent and contributing 60 per cent of India's GDP, urban India holds a significant position in world economy. According to the 2011 Census, 53 cities in India have a population of more than a million people. To cater to such a large population and tap their potential, Indian cities need efficient infrastructure and substantial investment.
According to Edward Gleaser, Harvard economist, urbanisation is undoubtedly a key driver of development and cities provide the national platform for prosperity, job creation, and poverty reduction. But urbanisation also poses enormous challenges like congestion, air pollution, social divisions, crime, and the breakdown of public services and infrastructure. And, also leads to build up of slums that one billion urban resident's call home. Urbanisation is perhaps the single most important question in development economics today.

Economics of urbanisation 

Cities are engines of growth. Economic growth and urbanisation are intricately linked. As Indian economy is on the cusp of rapid economic growth, policy makers realised that to boost economic growth, attract new entrepreneurs, promote job creation and make cities competitive, India needs strong and vibrant cities. Accordingly, the new government in its maiden budget observed that as fruits of development reach an increasingly large number of people, the pace of migration from rural areas to urban areas is increasing. 
To meet the aspirations of a neo-middle class, new cities need to be developed. The Finance Minister, in view of the Prime Minister's vision of developing 100 smart cities, had allocated a seed corpus amount of Rs 7,060 crore in the Union Budget.

Defining a smart city

What is a smart city?A smart city is generally meant as a city capable of joining competitiveness and sustainability, by integrating different dimensions of development. A smart city is able to support economic growth as well as provide high quality of life, with careful management of natural resources, greater transparency and wider participation in decision-making processes. According to the British Standards Institute, “A smart city is the effective integration of physical, digital and human systems in the built environment to deliver sustainable, prosperous and inclusive future of its citizens.”According to Government of India (GOI), smart city is "…able to attract investments and experts and professionals. Good quality infrastructure, simple and transparent online business and public services processes that make it easy to practise one's profession or to establish an enterprise and run it efficiently without any bureaucratic hassles..”

Parameters of the city

The term “smart city” was formally coined in 2007 by Professor Rudolf Giffinger, Vienna University of Technology while conducting a study to assess impact of challenge of combining competitiveness and sustainable development in wake of European integration and technological changes and examined urban quality of life, housing, economy, culture, social and environmental conditions. The study focussed upon issues such as awareness, flexibility, transformability, synergy, individuality, self-decisive, and strategic behaviour of city. 
Awareness was considered to be key as certain potentials can only be mobilised if inhabitants, companies or the administration are aware of the city’s position — knowing the city from within and also being aware of the surroundings that the city is located in. The study ranked the city in terms of six parameters — namely, smartness of economy, people, governance, mobility, environment and living conditions.

Techno-centred approach

In view of complexity of the topic, multiple meanings have been attributed to the concept of “smart city”. However, three main approaches have been generally agreed upon. First, a techno-centred approach, characterised by a strong emphasis on the “hardware” and, namely, on the idea that ICT infrastructure represents the keystone for building the smart city. Second, a human-centric approach, characterised by a strong emphasis on human and social capital. Finally, an integrated approach, characterised by emphasis on quality of life that a smart city has to ensure to create the conditions of a continuous process of learning and innovation.

Pillars of development

The key pillars of the smart city, to ensure high quality of life, are physical, social, institutional and economic infrastructure. The GOI, for defining smart city, has envisaged maximum travel time of 30 minutes (45 minutes in metropolitan area), unobstructed footpaths, dedicated and segregated pathway of bicycle tracks, at least 95 per cent of residents having access to retail markets, primary school and recreational area within 400 metres of walking distance, continuous water and electricity supply, and 100 per cent efficiency in collection of water-related charge, door-step solid waste collection, rain-water harvesting, Wi-Fi connectivity with 100 Mbps internet speed and a few more similar things.

Implementation the key

As can be observed from the above discussion, the concept of smart city is good but very difficult to implement. Illustratively, consider the case of silicon city of India, Bangalore. For the last two decades, Bangalore has been the centre of innovation to catalyse engines of job creation and gateway to the global marketplace. 

It provides access to Wi-Fi system in major places, online FIR system, elaborate bus system which may be tracked by smart solution apps, various online grievance-redressal systems and a host of all activities which can be termed as digital solutions but still the city is far away from being termed a smart city as electricity, water-supply, waste disposal, sewage treatment and mobility is not upto desired levels. Though urban planners have tried to reduce city congestion by having metro rail but that has also not achieved meaningful results.

As India is a developing nation with still nascent institutional framework and a comparatively weak delivery system, policy makers need to consider giving due attention to planning, connecting, financing and accountability. Planning for land use and basic services is primary. Yet because planning must allow for people and products to be mobile, it must be coordinated with connecting at all stages of a city's growth. Financing the infrastructure like sewerage, sanitation, roads, and other public amenities is another important factor in urbanisation. Finally, fixing accountability for the maintenance of the infrastructure is also necessary for sustainable urbanisation.

Transparent valuation
Urbanisation generates an increase in the demand for land, and a problem arises because land is scarce in places it is needed the most. A clear definition of property rights is a first requirement in this direction. A systematic, professional and transparent valuation process is necessary while making information on land values widely accessible. 

Although valuation of land is essential to the efficient allocation of land use, India lacks institutions for valuing land effectively. Where land values are concealed to avoid high-transaction taxes, or are distorted by laws that allow developers to acquire land at favourable rates, the result is inefficiency: land may not be allocated to the best use, high prices may lead to affordability problems, and infrastructure expansion may face delays because land is not easily accessible.Therefore, one solution to consider could be vertical expansion of cities that would lead to less demand of land.

The concept of smart cities can only be implemented with active participation of urban local bodies (ULBs). To inculcate professionalism, modernity, transparency and accountability in ULBs, there would be a need to shift from “Government to Governance” as ULBs provide basic interface between citizens and administration. 

There may also be a need to further simplify rules, regulations, byelaws, and remove archaic portions of laws like rent control act, and Slum Areas (Improvement and Clearance) Act, which inhibit growth, add confusion and lead to delay in construction.

Public transit system
In order to inspire confidence, the GOI could begin by reaping low hanging fruits. The public transit system could be given top-most priority as every city's economic growth is intricately linked to urban mobility. 

A poor urban mobility as well as unjustified costly proposition of metro rail or ill-designed BRTS system not only deteriorates economic health of cities but also has profound impact on overall economic growth. Improper prescription of costly transportation system has only pulled cities like Detroit into bankruptcy. A well-developed transit system can bring densification which can yield economies of scale in terms of building agglomerations.

Satellite towns
The policy makers could consider sustainable, maintainable, affordable, reliable and technically feasible solutions to make cities truly smart and propel India into higher trajectory of growth.Therefore, planners could consider setting up of satellite towns as smart cities, to begin with, as modifying existing infrastructure in deeply congested existing cities may be more difficult as well as expensive. 

Similarly, to ease the pressure on government finances, the ULBs could consider financing infrastructure in newly set up smart cities through floatation of local municipal bonds. 

Charan Singh is RBI Chair, Professor of Economics,IIM, Bangalore & Tarun Mittal is pursuing postgraduation in Public Policy at IIM, Bangalore

Defining ‘smart’

A smart city is able to support economic growth as well as provide high quality of life, with careful management of natural resources, greater transparency and wider participation in decision-making processes.

The British Standards Institute defines a smart city as, “The effective integration of physical, digital and human systems in the built environment to deliver sustainable, prosperous and inclusive future of its citizens.”

According to Government of India (GOI), for defining a smart city has envisaged a maximum travel time of 30 minutes.

There should be unobstructed footpaths, dedicated and segregated pathway of bicycle tracks, at least 95 per cent of residents having access to rertail markets
Primary school & recreational areas should be within 400 metres of walking distance. Also continuous supply of water and electricity. Wi-fi connectivity with 100 Mbps internet speed.

No comments:

Post a Comment