New Delhi: Urban development secretary M. Ramachandran spoke in an interview about the progress of the ambitious Rs50,000 crore Jawaharlal Nehru National Urban Renewal Mission, or JNNURM, which aims to improve quality of life in India’s cities. He indicated that the seven-year scheme that ends on 31 March 2012 could be extended for another five years. Edited excerpts:
It is nearly the mid-point of the scheme. How has it progressed in terms of reforms and projects?
Planning reforms: Ramachandran says the new way of improving the quality of life in cities could be through incentivizing their performance. Harikrishna Katragadda / Mint
There was no such (reforms) agenda for urban local bodies when this mission was launched. So it’s the first time the urban sector has been—if I may use the word—subjected to reforms... Everything is not supposed to be achieved in the beginning. But when we look back, like repeal of urban land ceiling in major states such as Maharashtra and Andhra Pradesh...that has been a big step.
Local bodies that did not have a major accounting system migrated to a regime of double entry bookkeeping...that is again something major. Now because of that, the corporator, or whoever is concerned in the city, has a direct feel of where we stand at this particular moment as far as the resource position of the local body is concerned.
Then the commitment to levy user charges in areas like drinking water...and that in a way leads to improvement in distribution of water supply…cities thinking in terms of 24/7 water supply...these are all chain reactions that have come up as a result of the reform measures.
The very latest decision to fund procurement of buses will mean a substantial change as far as urban transport is concerned since we have to move people from use of personalized vehicles to public transport. These 10,000-15,000 vehicles that can be procured in our mission cities…that would make a substantial difference.
Again because of reform measures, (in) some states, especially the north-eastern states, which did not have a legislative arrangement for having a local body, that has happened (local bodies are now in place). In Sikkim it has happened and in Mizoram it has happened.
Introducing metering in the water we are consuming, I mean in a state like Bihar, this was never heard of, but recently we approved a project. Bihar has committed to having meters, if not on a city scale, at least on a pilot scale. So this has got introduced.
We will have a final tally of how far we have progressed as far as reforms are concerned, maybe by the time the mission concludes by the (fiscal) year 2011-2012.
And we still have to look at various critical issues like the way water boards are functioning. There is need for substantial improvement. The way sewerage projects are taken up—ideally we should be able to complete coverage of entire city—so how best that can be facilitated. In tune with the improvements that the cities bring about, incentivizing the cities for the performance they deliver, this could be the new way for working with the cities.
What incentives can be given?
This is something that will have to be built into the scheme. And it is up to the city and the state concerned to take advantage of these, and decide to move forward. Every part of the country is not used to the same level of urban performance. But now every part of the country is coming on board as far as striving to achieve certain minimum levels in urban performance is concerned.
In the current context—it is an election year and there is talk of a fiscal stimulus—is there a step-back on pushing for reforms now as opposed to trying and getting projects on the ground?
Partly what you say is correct, but not fully. What we are saying is that since cities are not geared to this pace of implementation of reforms, some cities lag behind in reaching the milestones. The direct action would have been to stop further release of instalments. But that won’t serve any purpose because if projects are kept on hold, there will be certain consequent issues such as cost overruns, time overruns...
So what we have worked out now is that as far as release of second and third instalments (of funds) are concerned, we won’t really insist on whether the milestone has been met or not. We’ll naturally review whether the milestone has been reached or not and have a dialogue with the state concerned or city concerned…
So once that is agreed and worked out, we will go ahead with release of further instalments. But this will be applicable only up to the second and third instalments. As far as the fourth or final instalment is concerned, they will still have to meet this deadline, if the milestone is somewhere in between.
Which states are lagging in number of projects submitted and reforms undertaken?
We have that group of states—Gujarat, Maharashtra, Andhra Pradesh, Tamil Nadu and even Karnataka—that are well ahead. And then we have the north-east group of states as a category because the allocation itself is very small. So those issues are there. And then we have the remaining states and local bodies in the rest of the country, which, as I said, are not really geared to this pace of reform implementation.
The supplementary budget had allocated Rs4,200 crore in additional funds to the programme for this fiscal year. Has it been committed towards projects?
We have sent something like proposals worth about Rs2,000 crore to the ministry of finance for release. We are hopeful that the additional allocation target will be fully met hopefully sometime this month itself. We are taking up projects much faster. The sanctioning committee is meeting every week. We should be able to meet this target. That’s our estimate now.
Has any decision been taken on extending JNNURM into the 12th Plan?
During all our discussions with the Planning Commission, this has been indicated. It will be a process because various decisions will have to be formally taken...there are various issues to be sorted out.
So, one cannot say anything definite about that now. But the thinking of the Planning Commission is to support this and I think that is recognition of the fact that so far sufficient work has taken place, and there is scope to do more work and there is need to do more work.
Against Rs25,500 crore for the UIG (Urban Infrastructure and Governance, a component of the scheme), we have reached commitment levels of close to Rs21,000 crore already.
So in a way I am left with only something in the range of Rs4,000 crore for new projects and that, too, would be for those states which have not reached allocation limits.