Smart is also Innovative

Unlike traditional, spatially-isolated suburban business hubs and research facilities, investments in smart cities can be leveraged to strategically create urban innovation centres

Rana Kapoor,yes bank_RS (24)

Cities play a catalysing role as engines of economic growth, centres of innovation and inclusive development. The Union Government’s impetus on 100 Smart Cities presents a unique opportunity for India to emerge as a knowledge-based economy. Developing globally competitive and vibrant Smart Cities in India will uplift the country’s economic prospects and enhance citizens’ quality of life. The huge infrastructure investment will stimulate business generation, youth employment and improved urban-rural synergy. A new development paradigm, ‘the innovation district’, is emerging to spur economic development. Though the traditional zoning norms separated educational institutions and the workplace, the new model thrives on synergy between the two. These spatial development trends have been seen in the Silicon Valley, California, USA and 22@ in Barcelona, Spain and have now been adopted in various locations worldwide. India will be the most populous country by 2030, with its population touching 1.46 billion. Around 64 percent of India’s population is expected to be in the working age bracket of 15–59 years by 2026. While this presents a promising picture for the economy, the lack of formal education and employment opportunities is a caveat hard to ignore. This calls for urgent measures to create avenues for employment and human resource development. In this respect, Smart Cities are conceived as compact settlements leveraging technology to provide an environment conducive for the creation of employment opportunities, while improving the quality of life in cities. Innovation districts bring together creative institutions, business accelerators and incubators to encourage entrepreneurs and start-ups. Though special economic zones (SEZ) were aimed at bridging the infrastructure gaps for setting up industries, the policy missed out on the industry-academia connect. Innovation districts can seamlessly facilitate this to meet the aspirations of both ‘Smart Cities’ and ‘Make in India’. Unlike traditional, spatially-isolated suburban business hubs and research facilities, investments made in smart cities can be leveraged to strategically create innovation hubs within the city, thereby tapping entrepreneurial potential to generate employment opportunities and encouraging compact mixed-use development to trigger a multiplier effect on the economy. Innovation districts will drive economic growth by addressing the following concerns:

  • Turning research into marketable products: It is essential to bring the market perspective into research, to successfully transform ideas into products. The Global Innovation Index 2014 ranks India 76 out of 143 countries analysed. The figure clearly indicates that the Top 10 have focused on institutions.
  • Innovation and incubation to address the needs of rapidly changing markets: Indian Industries need to become more agile to not only keep pace, but be ahead of the competition to thrive in global markets. It is imperative to capitalise on R&D investment via Creative Clusters that can facilitate rapid exchange between research institutions and industry for business sophistication. An industry connect can also provide funds and direction for future research.
  • Social Networking and agglomeration economies: Innovation clusters can facilitate active exchange between researchers, entrepreneurs and investors to rethink issues and nurture innovation to shape the manufacturing landscape.
  • Smart Cities: SEZ and Smart Cities planning must be re-imagined to accommodate creative clusters. Future Smart Cities will provide integrated solutions like Wi-Fi zones, mixed-use development, affordable housing and good public transport to ensure efficient urban development. ‘Smart cluster planning’ within the smart city framework can cultivate collective intelligence and innovation to power sustainable growth.
The Creative Cluster approach can offer a unique identity to cities, sustain production lines, attract experts and professionals and boost India’s image as a preferred investment destination. It can also trigger urban redevelopment and social development in derelict urban zones. Urban Development Funds, REITs and InvITs can further shore up investments. I am confident that urbanisation and agglomeration economies will provide a plethora of opportunities to expand employment potential as India embarks on its journey toward inclusive growth. For the proposed 100 Smart Cities to be globally competitive, good quality spatial and economic infrastructure that offers an encouraging environment for business, workers and residents is needed. In order to achieve these objectives it is imperative to plan for innovation districts – capturing the spillover effects of infrastructure development. I believe that urbanisation and better functioning cities are critical to boost business and connect the economy to global markets.