Challenges Facing The Implementation Of The Smart Cities Programme

By Akhil Deo

Introduction- Why we need smart cities

The 11th Five year plan highlighted that urbanization would be the key indicator of socio-economic development and that cities will be the locus and engine of economic growth over the next two decades.[1] As of 2011 Over 400 million people, that is 30 percent of India’s population lives in urban areas and it is expected that by 2050 over 800 million people (50 percent) will do so.

However, as the World Bank reports,[2] the process of  urbanization in India has been messy and hidden with the proliferation of slums and other forms of informal housing around areas that are beyond the administrative boundaries of local government. Aggravating this fact is that India along with China are expected to contribute the most towards urban population in the coming years.[3]

Most of this urban population in India will reside in cities, however many of these cities  are already some of the most populous in the world. Further , Indian cities fare badly across a wide range of parameters that are indicative of good urban management.  A survey of urban city systems conducted in 2015 revealed that Indian cities are grossly incapable of delivering high end public services when compared to their western counterparts.[4]

Without the ability to accommodate this rapid rise in urbanization, governments will struggle to provide basic public services such as affordable housing, water, electricity and sanitation. With this context in mind, the Government announced its ambitious Smart Cities Programme

A brief overview of the Indian Smart Cities programme

According to the Draft Government Concept note on Smart City Scheme,[5] “Smart Cities are those cities which have smart (intelligent) physical, social, institutional and economic infrastructure while ensuring centrality of citizens in a sustainable environment. It is expected that such a Smart City will generate options for all residents to pursue their livelihoods and interests meaningfully and with joy.”

One hundred smart cities were supposed to be selected on the basis of Smart cities challenge involving two stages. In the First stage of the challenge potential smart cities in each State/UT were identified by giving equal weight age to urban population of the State/UT and number of statutory towns in the State/UT. Thereafter, a selection was made through a two-stage competition as per which cities within each State have competed against each other based on a set of criteria.

The ‘Mission Statement and Guidelines’[6] for the Smart Cities Mission released by the Ministry of Urban Development (MoUD) on June 25, 2015 attempt to provide clarity on some of the smart city related aspects and on the Mission itself. Strategic components identified in the Mission include:

  1. a) Retrofitting: Retrofitting will introduce planning in an existing built-up area to achieve Smart City objectives, along with other objectives, to make the existing area more efficient and livable.
  2. b) Redevelopment: Redevelopment will effect a replacement of the existing built-up environment and enable co-creation of a new layout with enhanced infrastructure using mixed land use and increased density.
  3. c) Green Field development: Greenfield development will introduce most of the Smart Solutions in a previously vacant area (more than 250 acres) using innovative planning, plan financing and plan implementation tools (e.g. land pooling/ land reconstitution) with provision for affordable housing, especially for the poor.
  4. d) Pan-city development: Pan-city development envisages application of selected Smart Solutions to the existing city-wide infrastructure. Application of Smart Solutions will involve the use of technology, information and data to make infrastructure and services better.

On 27th August 2015 the Centre unveiled 98 smart cities across India which were selected for this Project. Across the selected cities, 13 crore population ( 35% of the urban population will be included in the development plans. The mission has been developed for the purpose of achieving urban transformation. The vision is to preserve India’s traditional architecture, culture & ethnicity while implementing modern technology to make cities livable, use resources in a sustainable manner and create an inclusive environment. In January 2016, the Centre further shortlisted 20 cities. These 20 cities will be the first to receive funds, thus kickstarting the process of developing them into ‘smart cities’.

Challenges facing the programme

While the programme is ambitious in its outlook, there are several hurdles that will need to be addressed before smart cities become a reality. This essay proposes to highlight certain concerns regarding the implementation of the smart cities initiative:

Strengthening Local Governance

While the 74th Constitutional amendment introduced the concept of Urban Local Bodies to decentralize governance,  its implementation has been a fig leaf, especially because most of the functions assigned to the ULB under the 12th schedule being performed already by the state government. In fact, Article 243W of the Constitution gives states the discretion to devolve political, administrative, and fiscal power to municipalities. The ULB’s themselves have little role in raising funds or exercising tax powers.

With respect to the implementation of smart cities at the city level, the government proposes setting up a ‘Special Purpose Vehicle’ (SPV) incorporated under the Companies Act, headed by a CEO along with nominees of the Central and State Government.[7]  Already some local government officials have raised concerns over being bypassed in decision making and objecting to its impact on their autonomy and financial independence.[8] While the SPV has only been set up to oversee the implementation of the project, larger concerns surrounding the governance capabilities of the ULB’s under the current constitutional scheme remain.

In its report on Indian urban infrastructure and services,[9] a High level expert committee had recommended wide ranging institutional reforms with ULB’s at the head of city development planning and urban management.  Apart from the lack of constitutional autonomy, most local bodies have not developed the institutional capacity to play a key role in governing a city and did not have personnel with sufficient expertise. For example, a report on  appraisal of the JNNURM project had recommended that the following positions should be made mandatory: Legal expert, project management, finance expert, social development expert, egovernance expert, managers, public works expert, strong project engineering cell, urban experts, accounting experts, physical planning, transport, reform expert.[10]

Further, While Article 243Q of the Constitution states that municipalities should be created in every state, it is followed by a proviso stating that municipalities do not have to be created in urban areas designated as industrial townships. Already this may create a governance void because the centre is planning to designate smart city areas as Special Economic Zones. Without the ability to exercise administrative autonomy or building the capacity for local government to function effectively, a ‘smart city’ will be unable to efficiently utilize  the data and inputs that it gathers to deliver public services.  The Ministry of Urban Development had also released a model municipal law for states to enact, however very few have implemented it.

Implementing Land Reforms

Without the ability to intelligently and adequately utilize land, the infrastructure development needed to succefully implement the programme will be impossible.  However, most states do not even  have reliable land records. Recently the Rajasthan Government was the first ever state to pass a land titling law,[11] guaranteeing property ownership. Also, the multiplicity of state level laws such as Land Revenue Act, Land Reforms Act, Stamp Duty Act, and Urban Development Authorities Acts/Town Planning Acts continue to hamper the availability of land for housing and other construction, pushing up land prices.

Further, Indian cities tend to have  low fixed Floor Space Index Policies contrary to international practice which allows higher FSI’s in areas with greater connectivity and mobility, therefore allowing for differential use of land.[12] Low FSIs generate urban sprawl as development is forced to the periphery area. Sprawl is due to limits on real estate development in areas where the market would otherwise call for higher density to compensate for high land prices resulting from high accessibility.

Also India continues to have high stamp duty rates, which impedes the transferability of land and therefore reduces its supply.[13]  Unclear pricing is another factor that frustrates land management policy, The ‘circle rate’ which is the average value of past sale deeds is the most common methodology adopted. However as one report[14] points out, this does not factor in the various locational and economic factors that can affect the value of the land. Moreover, most private companies find it onerous to  comply with the consent clause in the Land Acquisition Act and are also apprehensive of being involved in litigation disputes that can take several years to resolve.[15]

Creating Inclusive Cities- Affordable Housing

A city is not just a physical place. It is where all development challenges meet: health, education, livability, and jobs, among others. Without safe and affordable housing, none of these parameters can be satisfied.

The National Urban Housing and Habitat Policy 2007[16]  underscores the need to develop adequate housing on both rental and ownership basis, especially for economically weaker sections of society. However, a report of the technical group[17] on urban housing shortage estimated that nationally there was a shortfall of over 18 million houses. This shortage is  expected to grow to about 34 million units by 2020.[18]

Some have already argued that  smart cities will essentially become walled communities for the rich at the expense of those for whom affordable housing, internet services, and technology driven public goods are inaccessible.[19] This is not an unreasonable speculation, with the technical group reporting that over 95 percent of the shortage of households was for economically weaker sections of the society.

Further, A survey carried out by the 65th round of the National Sample Survey  points to 49,000 slums in India, 24 percent of them along nallahs (drains) and 12 percent adjacent to railway lines.[20] The Indian experience has  shown that rapid redevelopment programmes tend to displace those that are already marginalized.[21] This which will only have the effect of pushing such communities towards the periphery of the city- and ultimately make the benefits of a smart city unavailable to them.

The Rajiv Awas Yojana and the Housing For All-2020 schemes are two of the main government policies directed towards guarantying affordable housing. However,  it is critical for governments to make them a key component  of the smart cities development plans.

A study of the 10 most populous Indian cities has revealed that rapid growth in cities has not reduced segregation by caste or religion. Dalits and Muslims are still heavily concentrated within certain geographical areas of cities, mostly in slums and poor neighborhoods.[22] There is also scope for these schemes to address the veiled discrimination that plagues our cities, a recent study by the United Nations revealed that Muslim applicants  find it harder to rent accommodation in households in Delhi. One author has suggested that the centre make disbursing of grants for housing schemes conditional on adopting a fair housing law that prohibits discrimination.[23]

Addressing Data Security and Privacy Concerns

The recent draft policy[24] released by the DeitY envisages a large role for the ‘internet of things’ and data collection in providing intelligent ‘e-solutions’ to a large array of urban services including energy, water management, transport etc. This is in keeping with policies that have evolved globally, with technology being the key driver of making cities ‘smart’. These policies naturally require  the  collection of a wide array of  information, including personal data.

The proliferation of the’ internet of things’ has prompted governments to take note of the potential risks as well. In its report,[25] The Federal Trade Commission of the United States acknowledges that “Some of these risks involve the direct collection of sensitive personal information, such as precise geolocation, financial account numbers, or health information – risks already presented by traditional Internet and mobile commerce. Others arise from the collection of personal information, habits, locations, and physical conditions over time.” [26]

India has recently grappled with technology and privacy concerns surrounding the UIDAI project. A report[27] by the Data Security Council of India in 2010 had noted that the UIDAI scheme remained vulnerable to a wide ranging privacy and security risks. Even after the passage of the Aadhar Bill, it was found that many of the privacy safeguards do not conform to the principles of privacy as laid down in the A.P Shah Committee report on privacy.[28]

These trends suggest a strong  need to update our privacy laws and policies, especially because the current legislation (the IT Act) is insufficient to address the concerns that smart cities might raise . For example, it is unclear whether the IT Act applies to the collection of personal information by the government because The Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules 2011 deals with accountability regarding data security and protection as it applies to ‘body corporates’ and digital data.

Conclusion-Taking stock of past failures

The Smart cities programme is not the first in India which envisages long term urban development. While it may conform with the global trend of making cities ‘smart’ in the sense that they utilize information technology to improve governance and lifestyle, the true challenge lies in providing even basic public services to every citizen of India.

In a report to the NITI AYOG, one study had listed several reasons for the failure of prior urban development projects, these include:[29]

  • Lack of capacity in smaller cities to implement urban development programmes. The existence of a big-city bias is evident from JNNURM evaluation studies.
  • GoI’s control over programme implementation and sanctioning of funds may lead to delays. Studies have indicated that involvement of higher levels of government increasingly affect the process of empowerment of local bodies.
  • Lack of use of participatory approach in capturing a local community’s needs and local solutions The role of ULBs in programme design and operationalisation are limited. The budgetary allocation for urban development in 2015-16 (around INR 16000 crore) is thus inadequate.
  • Programmes generally lack critical inclusion aspects. More opportunities for livelihood do not automatically translate into inclusion, especially gender concerns.
  • Planning tools used in programmes (such as CDPs under JNNURM14) fell short of effectively linking city growth plans with its spatial character. Use of template-based and over-simplified retrofitting city growth models resulted in less contextualised plan targets and generalised strategies.
  • Fragmented nature of programme implementation led to non-achievement of some of the key agendas such as creation of world class cities
  • Selection procedure of cities and towns and geographical and population coverage are critical factors in determining a programme’s success. Previous urban development programmes were found to be lacking in this aspect. This is partially responsible for the non-fulfilment of their respective development agendas.
  • Sectorial bias led to over-emphasis of certain types of infrastructure creation. For example, 63% of the JNNURM funding was received by water supply, drainage and sewerage sector in Mission cities.

The Smart cities mission should keep these constraints in mind during the implementation stage and must also be mindful of new challenges, such as privacy and data security concerns.


Akhil Deo is a fifth year student at HNLU


end-notes

[1] Planning Commission, Eleventh Five Year Plan, Volume 1  (2008).

[2]Ellis, Peter, and Mark Roberts, Leveraging Urbanization in South Asia: Managing Spatial Transformation for Prosperity and Livability. South Asia Development Matters ( 2016, Washington, DC: World Bank) at p. 4. .Available at<https://openknowledge.worldbank.org/bitstream/handle/10986/22549/9781464806629.pdf?sequence=17&isAllowed=y>

[3] United Nations (2012): World urbanization Prospects

[4] Janagraha Centre for Citizenship and Democracy, Annual Survey of Indias City Systems (2015) Available at < http://www.janaagraha.org/files/publications/ASICS-2015.pdf>

[5] Available at < http://164.100.47.134/intranet/SMART%20CITIES.pdf >

[6] Available at < http://smartcities.gov.in/writereaddata/SmartCityGuidelines.pdf>

[7] http://smartcities.gov.in/writereaddata/SPVs.pdf

[8] http://www.business-standard.com/article/current-affairs/three-civic-bodies-in-maharashtra-say-no-to-smart-city-project-115121300480_1.html

[9]High Powered Expert Committee Report on Indian Urban Infrastructure and Services (2011, GoI: New Delhi) Available at <http://icrier.org/pdf/FinalReport-hpec.pdf>

[10] Grant Thortan, Appraisal of JnNURM, Volume 1 (2011) at  p. 266, Available at <http://jnnurm.nic.in/wp-content/uploads/2012/06/Appraisal-of-JnNURM-Final-Report-Volume-I-.pdf>

[11] Anil Sasi, Rajasthans new land titling law: Groundwork for a faster development pitch ( 7 May 2016, Indian Express) Available at <http://indianexpress.com/article/india/india-news-india/rajasthans-new-titling-law-groundwork-for-a-faster-development-pitch-2788216/>

[12] Isher Judge Ahluwalia, Planning for Urban Development in India (ICRIER) Available at <http://icrier.org/Urbanisation/pdf/Ahluwalia_Planning_for_Urban_%20Development.pdf>

[13] Alain Bertuad, The economic impact of land and urban planning regulations in India (2002) Available at <http://alainbertaud.com/wp-content/uploads/2013/06/AB_-India_-Urban_Land_Reform.pdf>

[14] Thought Arbitrage Research Institute, Fair Pricing of Land and its Compensation in an Emerging Economy: Case for India (2014) Available at <http://tari.co.in/wp-content/uploads/2014/02/land-acquisition-web-pdf-final-printed-report.pdf>

[15] World Economic Forum , Reforms to Accelerate Development of Smart Cities (2015) at p.17 Available at <http://www3.weforum.org/docs/WEF_Reforms_Accelerate_Development_Indias_Smart_Cities.pdf>

[16] Available at < http://www.mhupa.gov.in/writereaddata/NUHHP_2007.pdf >

[17] Ministry of Housing and Urban Poverty Alleviation, Report of the Technical Group on Urban Housing Shortage (2012-2017) (2012, GoI) Available at <http://www.nbo.nic.in/Images/PDF/urban-housing-shortage.pdf>

[18] PTI, Urban housing shortage to touch 3.4 crore unites by 2022 (16 Feb 2016, Economic Times) Available at <http://articles.economictimes.indiatimes.com/2015-02-16/news/59196793_1_housing-shortage-affordable-housing-lig>

[19] Shruti Ravindran, Is Indias smart cities project a recipe for social apartheid (7 May 2015, The Guardian) Available at < http://www.theguardian.com/cities/2015/may/07/india-100-smart-cities-project-social-apartheid>

[20] (National Sample Survey Office 2010).

[21] http://hlrn.org.in/documents/Bangalore_Fact_Finding_Mission_Final_Report_June_2013.pdf

[22]Pranav Sidhwani, Spatial Inequalities in Big India Cities (May 2015, EPW) Available at <http://www.epw.in/journal/2015/22/review-urban-affairs-review-issues/spatial-inequalities-big-indian-cities.html>

[23] Alok Prasanna Kumar & Srijoni Sen, Divided cities cannot be smart cities (1 June 2016, The Wire) Available at <http://thewire.in/2015/06/01/divided-cities-cannot-be-smart-cities-2878/?

[24]Dept. of Electronics & Information Technology, Draft policy on internet of things, (GoI: New Delhi) Available at < http://deity.gov.in/sites/upload_files/dit/files/Revised-Draft-IoT-Policy_0.pdf>

[25] Staff Report, Internet of things: Privacy & security in a connected world (2015, Federal Trade Commission) Available at <https://www.ftc.gov/system/files/documents/reports/federal-trade-commission-staff-report-november-2013-workshop-entitled-internet-things-privacy/150127iotrpt.pdf>

[26] Id. at 14.

[27] Vikram Asnani, Vinayak Godse and Kamlesh Bajaj, Security and Privacy Challenges in the Unique Identification Number Project (2010, Data Security Council of india) Available at <https://www.dsci.in/sites/default/files/security_and_privacy_challenges_in_the_uidai_project.pdf>

[28] Software Freedom Law Centre, Evaluating the Aadhar Bill against the National Privacy Principle (2016) Available at <http://sflc.in/evaluating-the-aadhaar-bill-against-the-national-privacy-principles/>

[29]Bhattacharya, S., and Rathi, S.(2015). Reconceptualising Smart Cities: A Reference Framework for India, (CSTEP-Report-2015-03). Available at <http://niti.gov.in/writereaddata/files/document_publication/CSTEP%20Report%20Smart%20Cities%20Framework.pdf>

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