Home / Opinion / Acknowledging the new face of urban India

A new study on select Indian census towns offers some important insights into the socio-economic processes driving these settlements—oft ignored, but at the heart of India’s urbanization. Case studies of census towns in Bihar, Jharkhand, Odisha and West Bengal, carried out by scholars from the Centre for Policy Research (CPR) in association with the World Bank, show that many of these new census towns are essentially “small market towns" that have emerged as a result of better connectivity and rising rural incomes.

Between 2001 and 2011, the number of census towns trebled from 1,362 to 3,894, making for nearly 30% of the total increase in the urban population during this period. Some of these were, expectedly, on the periphery of large metropolises. However, as CPR’s Kanhu Charan Pradhan found in a 2012 study, more than four-fifths of these census towns are situated away from the big cities and not even close to class I towns. This, Pradhan says, indicates a “dispersed pattern of in-situ urbanization". In other words, rural-to-urban migration and the natural growth of urban hubs are not the only factors driving urbanization in India. The new study investigates these other factors and finds that economic activities in these settlements that exhibit urban characteristics but remain under rural governance are rather “ordinary", consisting mainly of “non-tradable services and commerce".

All the towns have the local bazaar, which makes for the “everyday economy"; most have old manufacturing units which may or may not be agro-based. In addition, the census towns have certain new economic activities: Para-transit and building construction are most important. Notably, they are not entirely driven by large government schemes, such as Pradhan Mantri Gram Sadak Yojana or Sarva Shiksha Abhiyan, which generate activity in these sectors, but also pushed by private demand for better-quality housing and the like. This is followed by private education, private healthcare, and mobile phones (retail, repair, recharge). These are all economic activities that have emerged from within the towns without any major external input. As the authors note, “This banality of urbanization, its commonplace ubiquity and non-remarkable nature of transformation masks a very important character of this transformation, which is its resilience and permanence."

This narrative of quiet and often unacknowledged “home-grown" development is only one side of the story. On the other side lies a messy entanglement of development policies, political machinations and complex governance structures. Gopa Samanta of Burdwan University points out in her study of census towns in West Bengal—the state which has reported the largest increase in the number of such settlements—that while “spontaneous urbanization through the transfer of capital from the agricultural sector to the commercial sector has given rise to a large number of census towns… These settlements are cases of denied urbanization".

For a settlement to be declared a census town, it has to satisfy three criteria: Its population has to be 5,000 or more; its population density has to be of 400 persons per sq. km or more; and at least 75% of its male workforce has to be employed in the non-farm sector. India is the only country in the world that has such a three-tiered framework of prerequisites, each of which sets a fairly high benchmark for urban qualification. Consequently, many scholars have argued that India is actually a lot more urban than official data suggests—contrary to the oft-repeated criticism that the country is not urbanizing quickly enough.

This has important policy implications: First, the urban-rural binary is now obsolete. As Barbara Harriss-White notes in her essay on Middle India, “The urban-rural connections made through the economy.... spanning both spheres, blur a binary distinction." The revamp of the Provision of Urban Amenities to Rural Areas scheme and the Shyama Prasad Mukherji Rurban Mission acknowledges this change. Second, while metropolises like Delhi and Mumbai deserve every bit of the attention they get, policymakers cannot ignore the small towns. Moreover, the small towns themselves are not a homogenous lot. Census towns closer to metropolitan cities have different characteristics than those away from urban hubs.

Another variable is the complicated classification process. Take, for example, Singur of Tata Nano fame. A well-connected, fertile census town since 1981, Samanta explains that this settlement has failed to upgrade to an urban municipality even after three decades because the built-up area of the Singur agglomeration, which now extends across three gram panchayats, is not taken into consideration when ascertaining the population of the census town. This leads to “denied urbanization".

Pradhan says this is often a “deliberate strategy of the state government to access Central government funds"—which is why in 2004, Tamil Nadu reclassified 566 town panchayats as village panchayats. Access to government funds (rural areas) and better public services (urban areas) is also a contested space. CPR’s new study finds that in most emerging towns some citizens, usually the business class and the local elite, want urban status while others prefer rural governance. If India’s urbanization is to be managed effectively and the economic potential exploited, policymakers must find effective ways to address the various aspects of this rural-urban binary.

How do you think India’s urbanization should be managed? Tell us at

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