Centre's Rs60,00,000-cr urbanisation plan to give a big boost to PPP projects
13 January 2015
Private investments in urban infrastructure projects are expected to get a big boost with the centre's avowed policy of promoting planned urbanisation, especially the so-called smart city projects that are expected to make urbanisation sustainable over a longer period.
The National Urban Development Mission aims at promoting 100 smart cities while equipping other identified cities with basic infrastructure even as the Heritage Development and Augmentation Yojana (HRIDAY) aims at reviving heritage cities.
The smart cities are expected to be financially and ecologically sustainable so that future generations are not deprived of their right to quality living while HRIDAY will ensure cleanliness in the next five years in all the 4,041 census towns under `Swachh Bharat' mission.
Speaking at a seminar on `Smart Cities for the Next Generation: International Conclave of City Leaders' on the side lines of Vibrant Gujarat in Gandhinagar on Monday, minister for urban development and parliamentary affairs Venkaiyah Naidu said the government's vision
and mission for urban areas is graded and comprehensive.
He said a high powered committee set up by the government had estimated that the proposed urbanisation plan would involve a minimum of Rs60,00,000 crore ($952 billion) investment in urban infrastructure sector alone over the next 20 years.
This includes investment of Rs40,00,000 crore to provide basic infrastructure in urban areas and another Rs20,00,000 crore for operation and maintenance (O&M) of urban assets and utilities over the same period.
To meet smart city needs like e-governance structures and round-the-clock water and power supply, it would be even more. This order of investments cannot certainly be possible with government resources. Hence, the government intends to promote domestic and foreign
private investments through public-private partnership route, he said.
Building a new urban India would hence offer immense investment opportunities. The government is committed to do the needful to enable the flow of such a huge order of investments, he said.
The government's mission for planned urbanisation aims at enhancing livelihood opportunities in urban areas through skill development under `Deendayal Antyodaya Yojana' and ensuring decent houses under `Housing for All' by 2022.
Naidu said since the cities and towns in the country are of different sizes and states of development and diverse characteristics, the government would follow different approaches to their development.
As per 2011 Census, 377 million Indians, accounting for 31 per cent of total population live in urban areas. India has over 7,900 urban habitations, out of which 4,041 are Census towns.
About 63 per cent of the country's GDP comes from urban areas. The largest 100 cities, comprising 16 per cent of the country's population and only 0.24 per cent of land area, account for 43 per cent of GDP.
Globally, about 80 per cent of GDP is generated in urban areas, which proves the intrinsic linkages between urbanisation and economic growth. Accordingly, he said, the government is looking at urbanisation as an opportunity to be harnessed in the larger interest, he said.
Studies have also established that while urbanisation is slow till it reaches 30 per cent, it will be quicker till it reaches 60 per cent. ''We are at this inflection point. We want to seize this opportunity.''
''Because of 'pull and push' factors of migration, urbanisation in our country has been haphazard on our country," he said, adding, ''We are keen to promote planned urbanization to enhance the quality of urban life to enable fullest expression of inherent and creative energies
He said the country has accepted the Gujarat Model of development as the one to be emulated – that the right model of socio-economic development is 'welfare through economic growth and development'.
Naidu also defended his government's taking executive recourse to legislative action in some important legislative measures such as coal block allocation and land acquisition, saying, ''Our government does not have the luxury of doing things leisurely. We have to move fast
in the direction of course correction.''
''In Parliamentary democracy, legislative action is the best way of conveying our intent. We were keen to move on with some important legislation in Parliament,'' he added.
He said these ordinances were primarily intended to convey the government's commitment to enhance investment climate in the country and improve 'ease of doing business', essential for reviving the economy.