What are your views on the urban scenario of India at present?

India is in the midst of an urbanisation process that will transform the country over the next two decades as its economy and society will become increasingly rooted in cities and towns. This has already begun to accelerate across many parts of the world. For example, if we take the case of urbanisation in African countries like Ghana, more than 50 per cent of the population is already residing in urban areas. However this process has been more gradual in India, By 2030, 40 per cent of India’s population will be living in urban areas. This process is being reinforced by economic processes that increasingly rely on market access, physical concentration and product specialisation. As a result the urban sector accounts for over 60 per cent of total GDP and this will increase further as cities become the engines of India’s future growth.

In this context, it is clear that whilst the urban sector is crucial for India’s future prosperity, there has been little or no effective urban planning and there are major deficits in core urban infrastructure that has suffered from years of past underinvestment. The HPEC, for example, has estimated the urban investment requirement at Rs.39 lakh crores over 20 years. There has, however, been a growing realisation in recent years that this deficit needs to be addressed if India is to begin the process of forward planning for an efficient and resilient urban economy. Evidences from the world demonstrate the importance of public transportation as a critical factor in this process which requires a significant scaling up of urban investment.

What are the challenges faced by government departments towards execution of the Smart Cities Mission on a proactive scale?

In response to this challenge the Government has launched a series of national urban investment programmes designed to address infrastructure deficits in water, sewerage and solid waste as well as transport, housing and area development. These programmes require cities to engage in a renewed process of urban development and regeneration and cities will face many challenges in realising this process. Almost all cities suffer from severe capacity constraints in terms of having the relevant work force which are right in number and are equipped with relevant skills. Cities also suffer from a range of entrenched practices that undermine staff efficiency, effectiveness and morale.

This requires new incentive structures that reward performance. Procurement processes are often complex, layered and non transparent and the concentration on lower cost often results in poor quality of project, delays in execution and stuck projects. Another challenge relates to the growing requirement to the leveraging of market finance through the creation of bankable projects that will attract private capital. At the same time cities need to assume a more proactive role on formulating and structuring improved PPP arrangements with greater emphasis on shared risk and risk mitigation to attract additional investment. These challenges have to be complemented by maintaining a balance between corporate decision making and citizen engagement.

How can we overcome these challenges?

To address this complex range of challenges, state governments need to work with cities to introduce new cadre reforms that will provide cities with appropriately skilled and adequate human resources. Cities require a new generation of staff with skills in urban architecture and planning, transportation, environmental management, finance and commercial services. Cities may need to create dedicated in-house teams with a mix of public sector and private sector professionals to help identify and implement specific investment projects. These teams need to assist in identifying critical revenue streams for each project or package and in developing project structures accordingly. Market engagement is also a critical process that is often overlooked. Projects cannot be developed in isolation without consulting private partners. Strategies and plans need wide consultation and citizen feedback, complemented by an environment for cross-learning and networking with other cities.

What is the role of IPE Global in implementation of Smart Cities initiatives?

IPE is proud to have been partnering with governments at central, state and city level across India to help design, operation and implementation of a wide range of urban investment programmes including AMRUT, Swachh Bharat Abhiyan and the Smart Cities Mission. In addition, IPE global been part of UK DFID funded urban investment programmes in Bihar and Madhya Pradesh and is currently implementing a number of centrally sponsored urban programmes in Karnataka, Chhattisgarh, J&K as well as city level projects in Madhya Pradesh, Rajsathan and Kerala. IPE has also provided training to more than 60 cities participating in Round 2 of the Smart City Challenge fund.