For the past half decade India’s infrastructure industry has enjoyed a Sea Link moment; a blast of growth when one could imagine that the private sector could deliver all the new roads, bridges, power stations and airports that the country needs so badly. The government says the boom will continue. Over the next five years it predicts that infrastructure investment will reach a new high relative to GDP, with some $1 trillion spent, half of it by the private sector. The trouble with this rosy prediction is that the balance-sheets of many Indian infrastructure firms are as potholed as the roads they resurface.

[Source: The Economist]

After the tremendous growth India enjoyed in the past decade, hope it has something more than malls to show for.

Focus on urban centers and focus less on far-flung regions in terms of infrastructure development (even providing reliable high-speed Internet access can open up numerous business opportunities). Instead divert those resources on making our metropolitan regions more productive and efficient. Foster an entrepreneurial climate by creating knowledge corridors around institutions of higher learning. Do not fight the natural trend of clustering by trying to spread economic growth around. Some regions will always be more productive than the others. We can instead focus on making them stronger by playing to its strengths.

If there is anything we can learn from the urban development of Silicon Valley or Research Triangle in the U.S., it is the underlying importance of the feedback loops of higher education institutions and the talent they attract. The trick in making the graduates stick around by offering them a climate of entrepreneurship through social & professional networking and heavy investment in infrastructure that focuses on quality of life. Urban areas with great weather already have an upper hand and India seems to be blessed with such regions.

Obviously, this is just a big-picture comment and specific details will be subject to debate.

My answer to “How should India urbanize?” asked here Big Ideas for India Contest: Question 8: How should India urbanise? was selected as one of the 11 winners in the Big Ideas for India contest. Rajesh Jain and Atanu Dey have been exploring solutions on India’s future developmental challenges and they rightly believe in the strength of the cities as an important factor.

As the capital of Uttar Pradesh, India’s most-populous state, Lucknow has attracted hundreds of thousands of migrants from rural areas, swelling the city’s population. Yet the city hasn’t completed any major new sewage infrastructure since before the country won independence in 1947. As much as 70% of residents don’t have sewage service, leaving much of the waste to flow directly into the main river, the Gomti, which has become a stinking cesspool.

Wall Street Journal has an article on India’s megacities with the tagline that they are choking India. But is that really what is happening in India? There is an inherent understanding that there is a conflicting dichotomy between urban and rural regions. But even if it does exist, quotes in the WSJ article itself contradict its byline:

Shami Shafi, a 35-year-old laborer in Lucknow, has seen his daily income drop by half in recent months to 50 rupees, or about $1, for carrying bags of potatoes and other goods in a local market. But “I’m not going back to my village,” he says. If work gets harder to find, “I’ll just go to another city.”

Atanu Dey, noted economist and widely-respected proponent of urban India points at the real culprits of urban problems.

Kamal Meattle reported the results of his efforts to fill an office building with plants, in an effort to reduce headache, asthma, and other productivity-sapping aliments in thickly polluted India.

He presented his innovative idea at the TED Conference this year.

Quick calculations showed that, given construction costs in the 1990s, profits made from the market-rate sale of 560 apartments would finance 1,000 free homes for slum-dwellers. So, to give away 160,000 homes, developers would have to sell almost 90,000 full-price homes. In total, they would have to build 250,000 each year.

In an insightful article, Dilip D’Souza, writing for the Outlook section in the Washington Post explains the futility of the current slum redevelopment schemes in Mumbai.

I will always welcome the transfer of public property into private hands, and even the most left-liberal activist will agree that it is more preferable to hand over property rights to the “little guy” transparently than to big evil builders after intense backroom dealings.

Gaurav Sabnis, an Indian blogger takes the argument further and advocates transferring property rights to slum dwellers thus giving them a better say in negotiations with the builders.

My uncle, a builder and developer in the Mumbai suburbs runs his construction business through the model that Dilip suggests i.e. by redeveloping properties which have surplus FSI (Floor Space Index) and effectively giving free homes to the original residents while making the profit off the additional housing units that he sells at market rate. More on the impact of that strategy for the housing condition in Mumbai later.

Ganesh Chaturthi is an annual religious festival celebrated by Hindus in India. It has grown from household worship to societal celebration involving huge idols of the elephant god.

The Mumbai Metroblogging Blog lists the seven most popular waterfront public locations that brings back memories. Professionally, waterfronts have been close to me since my design dissertation during my undergraduate years was based on waterfront revitalization.

Back in the days when Doordarshan (Indian state television) ruled the airwaves, if you tuned in during the weather forecast, you wouldn’t be completely off the mark if you thought that India’s urban regions comprised solely of Delhi, Calcutta, Bombay, and Madras – conveniently located in four corners of India. It was the natural corollary of India’s development since independence that has always been centered on its millions of villages. The idea of making villages self-sufficient drew its sustenance from the rather utopian Gandhian ideals. India’s early leaders also believed in heavy industrialization which led to development of cities like Jamshedpur–modeled primarily along industrial cities like Detroit in the developed world. The ‘Great Leap Forward’ (in stark contrast to its Chinese counterpart), came only after the post-1991 liberalization when India embarked on a path of economic reforms and globalization. The impact of rapid liberalization and expansion of opportunities were profound especially on the morphology of Indian cities.

In this new paradigm of development where hi-tech companies dominated the economic landscape, the cities became the primary driver of India’s development. The most profound impact was on cities hitherto dismissed as B and C class cities: Bangalore, Pune, Hyderabad. In less than a decade, Bangalore, taking advantage of its higher educational facilities, skilled workforce and salubrious weather transformed itself from a ‘’pensioners paradise’’ to the ‘’Silicon valley of the east’. Leveling of the playing field, as Thomas Friedman has termed the flattening of the world accorded these cities a near-equal opportunity to boost their economic growth. No longer were megapolises like Delhi and Mumbai the magnets they once were. It is not as if the importance of these cities has necessarily diminished—they have continued to grow at a fervent pace—however, the belief that easy movement of labor and capital facilitated by advances in telecommunications and transportation is more important than geographic location has gained credence leading to the growth of several mofussil regional centers. As land prices in cities like Bangalore and Pune skyrocket, companies are increasingly looking towards smaller towns like Ludhiana and Coimbatore. It is quite clear that India would continue to experience en masse movement of populations within and to urban regions. Given the continuing dominance of the state even in the post-liberalization era, has the state taken the right steps toward building India’s future cities. The answer, unfortunately, is an emphatic no. India’s urban infrastructure has crumbled in the face of this rather rapid growth: roads are overcrowded, shortage of electricity and water is a perennial problem, and in most major cities, almost half the population lives in slums.

In fact, it could be argued that the overbearing influence of the state is responsible for many of the problems which plague urban India. State continues to remain the largest landowner—worse, there is little distinction its role as a property developer and as a regulator. In cities like Delhi, government bodies like the Delhi Development Authority have completely monopolized urban development. Their extremely tardy performance—people sometimes have to wait for as many as 25 years for their cherished flat or a piece of land—has led to the growth of slums and illegal colonies. Land needs to be freed of government control and private developers should take the center stage. Along with it, legislative reforms are essential. Laws like the Urban Land Ceiling Act (ULCA) and Urban rent Control Act( URCA) are dinosaurs from another era that need to be scrapped immediately. Unfortunately, special interest groups like the trader bodies have continued to resist reform. Considering that they have harmed the poor the most by sending land prices to astronomical levels, a government which ostensibly speaks for the aam aadmi should have no hesitation in removing them from statue books.

The second crucial issue is the lack of infrastructure. State electricity boards continue to supply power to most Indian cities. Their services are poor and erratic and transmission and distribution (T&D) losses—an euphemism for theft is close to 50%. The situation is not much better in case of water or for that matter sewer. Here again the government needs to step down from its commanding heights and let the private sector do the job. The example of BSES is illustrative; the company, India’s oldest private sector electricity distributor has ensured almost uninterrupted electricity supply in Mumbai—surely, a luxury by Indian standards.

Even worse is the state of urban transport. With rising income levels, and a more consumerist culture, Indian roads are groaning under the weight of cars and other modes of private transport. The government has responded to this challenge by constructing an ever greater number of flyovers in cities like Delhi, Mumbai and Bangalore. As many urban transport experts have pointed out, flyovers provide only temporary relief. What is required is a modern, efficient urban transport system Unfortunately only two cities in India currently boast of a metro system. An efficient mass rapid transport system with feeder buses would go a long way in solving the problem of overcrowding in Indian roads. The example of Navi Mumbai is illustrative; it only took off when the local trains service was extended till Belapur and eventually Panvel. The rapid commuting option, as with the suburbanization in American cities put the development of Navi Mumbai on the fast track. Most urban transport systems in the world are unprofitable due to the extremely high capital costs. However, they more than recover their costs in the form of indirect saving: reduction in pollution and commuting time. Hence, the state should take the lead in developing urban transport system adopting the hugely successful Delhi metro model. This will also allow the state to utilize other policy tools for reducing private transport: enhanced parking rates and congestion charges in the Central Business District (CBD) areas to give just two examples.

Perhaps, the biggest challenge Indian cities face is solving the problem of slums where millions of Indians continue to live amidst poverty, squalor and disease. The state’s response has been to let the slums grow, largely under political pressure and then attempt demolitions. It is quite clear that millions of people simply cannot be thrown out of their homes. Currently in Mumbai, the Slum redevelopment Agency (SRA) is attempting the re-development of Dharavi slums by involving private parties. While the jury is still out on how successful will this model be, it is quite clear that only this kind of private-public partnership with active involvement of the slum dwellers can help solve the problem of slums. Needless to add, this policy will only succeed in conjunction with legislative and administrative reforms advocated above along with a zero tolerance policy towards future squatters.

Finally the philosophical question: What should be our urban planning model? Some policy makers have often looked up to the Singapore model and advocated the benefits of central planning in directing the growth of the city. As the example of India’s previously planned cities like Chandigrah and Gandhinagar has shown, that may not always be the best answer. City planning is one of the few sectors where the public and private sector can work individually toward common goals. The government should take a backseat in macro-planning, invest in essential infrastructure, tackle environmental issues, and simply creates opportunities for businesses to prosper. India doesn’t necessarily needs the ‘central planning-oriented’ government policies that have worked in China or the Singapore model—rather, by simply deferring to indomitable Indian entrepreneurial spirit that has worked wonders for the business sector; she can see the consequential effect on the form of Indian cities as well. Cities need not compete in attracting the best of all businesses (or industries) and talent but instead work at developing their competitive advantages to target the demographics and businesses best suited to its region and character.