Is the Central dispensation already having second thoughts about one of Narendra Modi’s pet projects? During the course of his please-all Budget exercise, Finance Minister Arun Jaitley did allot 1,200 crore for two sub-corridors within the Delhi-Mumbai Industrial Corridor project but avoided the term ‘smart city’ in describing them. Likewise, Jaitley skipped using the phrase while talking about the realisation of the GIFT (Gujarat International Finance Tec) City project, which is hailed as the country’s first smart city in the making.
This marks a definite turnaround from last year when, on the same platform, Jaitley elaborately stressed on India’s need for smart cities to house the increasing urban population and allotted an impressive 7,060 crore for making them happen. But recent developments have put a spanner in the works.
The signals are not particularly clear, as the urban development ministry has just a concept note (that too in draft form) to show for the 7,060 crore allocated last year. It was reported on 21 December 2014 that the ministry has spent only 800 crore so far. Rules restrict the spending of unutilised funds in the last quarter of the fiscal and this will ensure that 80-85 percent of the fund would have to be returned by March-end. Is it that far-from-smart fact that accounts for Jaitley’s volte-face? It certainly seems so.
The Modi government has ambitious plans to build 100 smart cities but the 78,000 crore GIFT City — the first smart city that the Gujarat government had embarked on in 2007 when Modi was the chief minister — is caught in red tape at the Centre, threatening its viability due to incomplete buildings, lack of power utility lines and most importantly, the absence of corporate tenants who were expected to populate it.
The Gujarat government has approached the Centre, now firmly under its previous boss’ grip, to push long-pending clearances from the ministries of finance, highways and civil aviation, for GIFT City so that its first phase can meet its earlier deadline.
A 50:50 joint venture between the state government undertaking and the Infrastructure Leasing and Financial Services (IL&FS) Ltd, GIFT City was planned as a global financial and it services hub spread over 886 acres near the Ahmedabad airport and is expected to create a million direct and indirect jobs.
Though the project was allowed to set up a multi-services special economic zone with an international financial services centre in 2011, not a single financial institution is ready to set up shop, say officials, as the government is yet to issue any regulatory norms on carrying out operations within the financial services centre.
Modi wanted GIFT City to be comparable to global financial hubs such as London, Tokyo and Shanghai but not a single financier is ready to book space in the city due to the lack of norms. Repeated requests to both the finance and commerce ministries to notify some regulations for such operations, without which existing capacity isn’t being utilised while further development of the project is hindered, have not borne fruit, leading to disappointment and dismay.
A few months ago, Gujarat urged the urban development ministry to intervene for an early resolution of the hiccups faced by GIFT City. The ministry, in turn, has escalated the case to the project monitoring group set up in the Cabinet Secretariat to expedite stalled investment projects and the project is now under examination, say officials. One of the biggest roadblocks faced by GIFT City is the civil aviation ministry’s reluctance to grant height clearances to most of the tall buildings expected to dot the city’s length and breadth. This has thwarted construction work on most of its flagship towers being built in the first phase.
“The Airports Authority of India (AAI) has granted permission to build towers up to only 191 metres above the mean sea level,” says an official. “At this height, 47 of the 110 buildings, including its biggest towers, cannot progress.” The tallest of the 110 buildings that are part of the masterplan, named Diamond Tower, is expected to rise up to 410 metres, while two other towers would be more than 350 metres tall. GIFT City had requested the AAI, which is also in charge of air space navigation services and related clearances in the country, to grant it a height clearance for buildings up to 476 metres.
Similarly, the National Highways Authority of India has been hesitant about granting permission to lay power cables to light up the project’s infrastructure.
Nevertheless, Jaitley has allocated 22,407 crore overall for housing and urban development in this Budget. This is a good amount but it will need to be backed by proper policy guidelines to achieve the grandiose aspirations of urban India. Lack of policy guidance stalled about 250 under-construction urban infrastructure projects as the UPA government’s Urban Renewal Mission completed its sanctioned nine-year term on 31 March 2014 and the new regime neither extended it nor replaced it with a new one. It is not desirable that urban development projects are stalled even when the funds are lying unused in the ministry’s coffers.
The NDA government’s 100 smart cities project held mega significance as it marked a monumental shift in national policy. This was a positive move as India is rapidly urbanising and there is a need to expand the UPA government’s flagship Jawaharlal Nehru National Urban Renewal Mission, which was limited to 65 select cities. The new vision was to cover urban renewal of 500 cities, rejuvenation of heritage cities such as Varanasi and the implementation of 100 smart cities (understood to be both ‘greenfield’ and ‘brownfield’ development).
With their collective desire to copy London, Tokyo or New York, planners, engineers and governments have failed Indian cities. The buzz over smart cities was interesting because for the first time politicians were talking about improving our cities based on systems instead of aesthetics. But many experts expressed genuine fears that we might fall into the trap of the western idea of smart cities and empty our limited coffers in building something that might further reduce our urban landscape into refined, high-end enclaves surrounded by vast, formless slums where issues such as e-governance and broadband connectivity have little immediate relevance. Today, smart thinking will require not only copying the model cities of the already developed western world but also find a new measure of liveability that will work for the Indian situation, where the cost of growth is unaffordable for most.
According to environmentalists, a grand mission can be time consuming and the government should rightly take its time to get the details right. We cannot afford any more half-borrowed and half-understood schemes. It may be late but we have a concept note now; the task at hand is to translate it into an effective reality on the ground.
The UPA government’s Urban Renewal Mission couldn’t achieve its target, mostly due to differences over money and responsibility sharing arrangements between the Centre and the states. And the same malaise seems to have struck the smart cities, too. Urban Development Minister Venkaiah Naidu recently announced that cities will have to earn funds for smart cities, pointing out that the Centre won’t invest based on the need of a city but its ability to impress the ministry with fancy proposals.
The country already has cities with very compact, walk-to-work, mixed-use, high density and resource-efficient urban form that western cities are now recognising as sustainable and trying to achieve for themselves. As it is, the focus has to be on appropriate technology to modernise. What’s thus required are not just smart policies and digital management systems but the means and the creativity to execute and implement them at the level of the ministry.
But now with no funds earmarked for smart cities, all eyes are on Naidu as to how he will complete the projects left unfinished by the UPA government as well as roll out an action plan for smart cities that not just makes them smart but also inclusive and dynamic to address all that ails our cities: problems of housing, water, energy, pollution, waste, mobility and inequality. And this has to happen on the ground and at its earliest and not just for 100 but all the towns and cities of India.