Rise of Smart Cities: Urbanization and Economic Transformation in India 2047

Smart Cities Mission (SCM) has envisaged building 100 identified existing and/or new cities in India into smart cities, in its maiden tranche initiated in 2015, and its slowly but steadily making progress.

As per the data presented by the Ministry of Housing and Urban Affairs (MoHUA) to the Lok Sabha, as of 7 July 2023, work orders have been issued by 100 Smart Cities in 7,978 projects, of which 5,909 projects (74 per cent) have been completed. The government has released Rs 73,454 crore for 100 Smart Cities of which Rs 66,023 crore (90 per cent) has been utilised.

The total cost of these SCM projects comes to Rs 1,79,228.99 crore, while the initial total estimate was Rs 2.05 lakh crore, of which less than a half would be funded by the governments, and the balance to be mobilized from internal or external sources, and other central government schemes.

Surat city from Gujarat has topped the charts in India in SCM Rankings for 2023. Along with it, Agra, Bhopal, Ahmedabad, and Varanasi were among the top five ranks, while Tumkuru, Madurai, Udaipur, Vellore, followed by Kanpur, bagged the next five positions.

SCM, inter alia, aims to provide core infrastructure, a clean and sustainable environment, and a decent quality of life to its citizens through the application of ‘smart solutions’. The development and application of ‘smart’ solutions to overcome various urban problems is the main feature that distinguishes the SCM from previous urban-reform initiatives. With rapid advancements in information technology over the recent years, these smart applications cover almost all the branches of urban management today, including making governance citizen-friendly, accountable, transparent and cost-effective.

Though some of these Smart City projects are completed by now, many urban challenges remain unaddressed, particularly in basic necessities like safe drinking water, clean air, good quality public transport, and roads and pavements, besides both social infrastructure (schools, hospitals, public parks) and economic infrastructure (bridges, flyovers, markets). Besides, roads develop potholes and certain locations get flooded in these cities during monsoons.

Slow progress in implementing the mission has been a matter of concern. Launched on June 25, 2015, as a joint effort of MoHUA, and all state and Union territory (UT) governments, this was targeted to be completed by 2019-20, but has since been extended by another five years. The selection of 100 SCM cities was completed only by July 2018.

"India's Smart Cities Mission, 2015-2021: A Stocktaking" ORF Special Report by Rumi Aijaz, released in August 2021, highlighted some serious lacunae in administration and execution of projects - some of the SPVs were unable to function well due to vacancies at high levels, facing audit violations, inadequate understanding of data and analyzing requirements for developing effective smart solutions, and lack of coordination between different government departments.

Another major threat that is lurking is data protection and ensuring data privacy of various stakeholders, which can leave enormous consequences if one has to go from the case of Oldsmar city, Florida, in the US, in February 2021, when an intruder boosted the level of sodium hydroxide (used to control acid levels and remove metals from drinking water) in the water supply to 100 times higher than normal.

The study has also found some anomalies and delays in ensuring funds flow to the mission projects, particularly by the Centre and states, which are finding it difficult to mobilise funds for the projects being implemented by municipalities, transferring them to SPVs, and use them effectively, citing some examples.

The ultimate challenge to SCM will come up when the share of urban population grows from over 40% at present to over 50 percent in a few years from now, and prove present calculations wrong. The mass movement of people from villages to cities in search of livelihood should not result in haphazard urbanisation, which was the case earlier.

Meanwhile, MoHUA has initiated a number of programmes to enhance the SCM’s impact, including digital infrastructure and tools under a National Urban Digital Mission (NUDM), capacity-building through the National Urban Learning Platform (NULP), Ease of Living Index (EoLI), and Municipal Performance Index (MPI) for tracking well-being of citizens and governance respectively in 111 cities, an annual India Smart Cities Awards Contest (ISAC) organised since 2018, and offering over 10,000 internships under the Urban Learning Internship Programme (TULIP).

Two years of implementation time was lost due to Covid-19 and related precautionary measures. The government is working overtime now to cover the time elapsed and complete projects within the new deadline and create a sustainable and inclusive urban space for all. Several projects completed so far are delivering a high level of socio-economic benefits to the marginalised sections of population in many of these cities already.