Photo: PTI
Photo: PTI

At sixes and sevens

Local politics needs to focus on better city planning and policies by developing talent in urban local bodies

As you read this, the odd-even traffic pilot in Delhi continues. The situation has come to this because of years of neglect and the sheer ineptitude in India’s largest municipality and only city-state. This has resulted in everyone professing an opinion, the courts wading in and resourceful criminals offering “solutions" to beat the measure.

Don’t rest easy that this extreme incapacity is restricted only to Delhi. Chennai just went through a completely avoidable and atrocious week of floods; Bengaluru is a giant open garbage dump; 80% of Mumbai is still subject to floods; and the bustees of Kolkata are overcrowded and filthy.

And these are merely India’s largest cities. In the next 15 years, another six or seven cities will be counted in the metropolitan category. Ahmedabad, Surat, Jaipur and Nagpur will join Hyderabad and Pune as mega-cities. None of the managements in these cities appear to comprehend the rate at which India is urbanizing and the escalating challenges that it will bring.

A McKinsey report on India’s urbanization illustrates this dire situation with numbers. Only 30% of urban sewage is treated, public transportation’s share has declined to 30%, storm-water drain coverage is only 20% and only 70% of solid waste is collected. Twenty-four per cent of urban India lives in slums and per capita open space in Indian cities is only 2.7 sq. m, versus 14 sq. m in Beijing.

Indian politicians—both in Delhi and in the states—have failed to understand that cities have become India’s engine of growth. By 2030, India’s urban GDP share is likely to grow to 70%, and India’s urban population is likely to be about 600 million. That is what creates the problem, of course, but it will have to be managed if cities are to continue as job machines.

What can be done?

So far the problem has largely been described as an “urban infrastructure and capital expenditure" problem. True, that is a major issue, with capital expenditure estimates of around 80-90 trillion ($1.2-1.4 trillion) for the next two decades. Financing operating expenditure is no less challenging—with non-comprehensive and inefficient collection of property tax and an ad-hoc and inadequate fee structure for other municipal services.

Despite the significance of the financing issue, the real challenge lies in getting local politics to focus on the long-term through better city planning and policies and by developing specialization and talent in urban local bodies. Several groups and initiatives such as 2nd Administrative Reforms Commission (ARC), the Jawaharlal Nehru National Urban Renewal Mission, Janaagraha, and the Indo-US Financial Institutions Reform and Expansion project have provided solutions to various aspects of the problem. But the problem’s scale, inter-linkages, talent requirements and financial needs are so large and complex that it defies ordinary comprehension.

The ARC report on local governance and the devolution recommendation of the 13th and 14th Finance Commissions have supported the decentralization enshrined in the 74th amendment to the Constitution. Decentralization of political authority and financial resources will need to be augmented with a hub-and-spoke training system at the regional/state level combined with greater public-private participation in several sectors of municipal development.

There are scattered examples of successes even in the Indian context. The reach and operational efficiency of the Delhi Metro is well known. The road transport corporation of Bengaluru is one of the few that turn an operating profit and Mumbai’s bus system has a large footprint and is run efficiently. Thiruvananthapuram’s garbage collection and Surat’s solid-waste management are quite good. For financing, the taxable and tax-exempt bonds issued by Ahmedabad backed by receivables (without state guarantee) and the pooled municipal bonds issued in Tamil Nadu and Karnataka are benchmarks. Tamil Nadu has taken the lead in developing a municipal accounting and financial reporting standard. Sadly, there is no single Indian city, big or small, that can claim to be comprehensively well managed. This suggests that there needs to be a meta-solution, not merely one that pushes decision-making down the chain.

The solution can have a beginning if a city is imagined as an economic and job-creation entity with wide-reach transportation as a vital component. Mass transit and public space have to become an integral part of the design of new cities. With help from the centre, states should implement plans for a municipal cadre. Until the cadre can be recruited and trained, lateral entry to specialized jobs and collaboration with specialist non-governmental organizations should be widely practised. Many service areas, including property mapping and tax collection, should be outsourced. Monetization of municipal land combined with improved efficiency of property tax collection must form the basic method of capex and opex generation.

Many successful cities around the world have shown that they can be turned around in a decade. Gimmicky solutions like the odd-even plan should be jettisoned in favour of rigorous long-term planning.

P.S. “I found Rome a city of bricks and left it a city of marble," said Augustus, the first Roman emperor.

Narayan Ramachandran is chairman, InKlude Labs.

Comments are welcome at narayan@livemint.com. To read Narayan Ramachandran’s previous columns, go to www.livemint.com/avisiblehand

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