Photo: Mint
Photo: Mint

Chasing definitions in India

India needs to shed the premium on the tags 'rural' and 'urban' and policy needn'tbe driven by these distinctions

The Union government’s practice of organizing schemes and regulations based on rural-urban categories has created high stakes in these labels. As a result, the categorization of settlements can become something of a game. For instance, between 2004 and 2006, 561 “Town Panchayats" in Tamil Nadu were converted to “Special Village Panchayats", and back again to “Town Panchayats". They converted the first time apparently to receive more rural funds from the government, and when these expectations were not met, they reverted.

When places that are urban in nature are governed as rural, and vice versa, this can lead to gross misallocations and inappropriate regulations. It would be prudent to reduce our dependence on such categories.

For the constitutionally mandated third tier of government, a settlement is urban if it has some form of municipal administration. The Census calls such settlements Statutory Towns. The conditions for determining Statutory Town status are decided by states. The Census defines as urban all Statutory Towns; their outgrowths, which form part of the urban system but are beyond urban administrative boundaries; and Census Towns, which are categorized using the guidelines of at least 5,000 inhabitants, a density of at least 400 people per sq km, and at least 75% of the male main working population engaged in non-agricultural pursuits. So the Census’ conceptualization of an urban area recognizes that what is urban in nature may be different from what is governed as urban.

In West Bengal, conditions for Statutory Town status include a minimum population of 30,000, while for Himachal Pradesh, the bar is set at 2,000. States may have the ability to declare areas as rural or urban regardless of such benchmarks, but this can impact the extent of areas that are urban in nature but governed as rural. West Bengal has 780 Census Towns, while Himachal Pradesh has three. However, Union government rules that give allocations based on rural or urban status and mandate functions of rural and urban local bodies are the same across states.

Our Census Towns are assuredly urban in nature given their stringent criteria, but are eligible for rural schemes and are exempt from some taxes. People residing here are often deprived of basic urban planning, which panchayats are ill-equipped to provide. Statutory Towns fall under the 74th amendment to the Constitution—which created urban local bodies as another layer of government—enabling their local bodies to include representatives with skills in municipal administration, and entrusting their local bodies with functions including land-use planning, building regulations, and fire services, which is not required of panchayats.

Hence, we may be faced with dangerous situations wherein Census Towns have safety requirements of urban areas, but are unable to provide them. Amending the 74th amendment to set a high minimum threshold beyond which a settlement must be administered by an urban local body could mitigate this problem.

Opposition to urban classification may come from many fronts: voters evading higher taxes, panchayats wanting to preserve power, construction industries avoiding stricter building norms, stakeholders seeking earmarked rural funds, and state governments opposing formation of municipalities in places where different parties enjoy local support.

Urban definitions across countries vary widely, from administrative criteria to size and density standards. As part of an IDFC Institute study, we calculated how urban India would be if we used a population criterion of 5,000 or more, as used by countries including Ghana and Qatar, and a population criterion of 2,500 or more, as used by Mexico and Venezuela. We found that India is 26% administratively urban, 31% urban by India’s Census definition, 47% urban by the 5,000 population criterion, and 65% urban by the 2,500 population criterion. 

Since perfect definitions remain elusive, we can at least reduce their relevance. The government has acknowledged the need to provide assistance to urban areas beyond municipal limits, albeit through initiatives that still work through “rural" and “urban" channels, such as the “Rurban Mission". There has been talk of the flagship Mahatma Gandhi National Rural Employment Guarantee Scheme being deployed only to the “neediest" rural areas. Suggestions have been made to introduce some municipal taxes in Census Towns. If it is politically difficult to increase taxes in the agricultural and rural sectors, steps such as this could help separate agricultural areas from those falsely parading as rural.

And if we are prepared for a real leap of imagination, we can even question the merit of rural versus urban classifications. If we instead acknowledge settlements as having varying levels of populations and densities, we can think of them as places where different levels of governance will be appropriate— smaller areas need fewer safety norms like access roads for fire trucks, and some municipal services are financially viable only if they serve a minimum population and density. Then, the only thing separating settlements will be how feasible it is to supply such services and the degree of safety measures required—a true departure from rural and urban constructs that allow for play on perceptions and rules, enabling exploitation of these categories for personal, economic and political ends.

Komal Hiranandani and Vaidehi Tandel are with the IDFC Institute.

Comments are welcome at theirview@livemint.

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