Urbanisation is not just an inevitable process, but a trend that can be harnessed to push the Indian economy to a more desirable position. For this, infrastructural investment and development are required.

By Priya Saraff

Urbanisation is India’s “opportunity and priority”. That’s what Arun Jaitley said in his speech while presenting the Budget of 2018. Various schemes are in place to holistically develop cities, in terms of infrastructure, hygiene and connectivity. When it comes to infrastructure, this Budget has allotted Rs. 5.97 trillion to this sector. Funds have been channelled into the air connectivity scheme UDAN. There are also measures in place to control the air pollution in the Delhi-NCR region. The most important urban schemes are the Smart Cities Mission, AMRUT, and Pradhan Mantri Awas Yojana.

Smart Cities Mission

The budget allocation for this is Rs 6,169 crore. Launched in 2015, this mission aims to develop 100 ‘smart’ and citizen-friendly cities in the country. This will be carried out through the construction of smart roads, solar rooftops, smart parks, and so on. An overall investment of Rs. 2.04 lakh crore has been allotted for the scheme. The cities for this scheme were chosen through five rounds of competition. 99 cities have been selected. The selected cities must establish a Special Purpose Vehicle (SPV) which plans, approves, provides funds and manages all the projects. 86 cities have set up their SPVs and 62 have got their Project Management Consultants. According to the Finance Minister, projects of Rs. 2350 crore have been completed and projects of Rs. 20,852 crore are under progress.

AMRUT

With a Rs 6,000 crore budget allocation, Atal Mission for Rejuvenation and Urban Transformation (AMRUT)is a mission with three main goals. Firstly, it seeks to provide accessible taps and sewerage facilities for every household. Secondly, it wants to develop green and open spaces in urban areas. Finally, it aims to encourage public and non-motorised forms of transport to reduce pollution

Closely linked with the Smart Cities Mission, AMRUT aims to provide tap and sewage facilities to 500 cities across India. It adopts a “project approach” (as against the Smart Cities’ “area approach”). AMRUT uses the methods of ‘incrementalism’ to achieve the Service Level Benchmarks (SLBs). This indicates a step-by-step method of achieving benchmarks so that steady progress can be made. States are to be equal partners in this scheme, with the power to approve and sanction projects. Cities create Service Level Improvement Plans (SLIPs) which are collected to form the State Annual Action Plan (SAAP) to be submitted to the Apex Committee. At present, water supply contracts for 494 projects have been approved and sewage work contracts for 272 projects have been awarded.

Pradhan Mantri Awas Yojana

One of the main programmes of the current government, this project aims to create affordable housing for all by 2022. Its four components include slum redevelopment with the help of private sector, credit-linked subsidy schemes, affordable housing provided through the partnership of public and private sector, and finally, affordable housing through beneficiary led individual house construction. The total Budget allocation for this is Rs 6,500 crore

The houses made under this programme will be in the name of the woman of the family or will be held jointly by the male and female head. Credit Linked Subsidy is offered through discounted home loans to the Economically Weaker Sections (EWS) and Lower Income Groups (LIGs). The programme will ultimately cover over 4000 cities. As of now, 3.19 lakh houses have been constructed and 19.49 lakh houses have been grounded.

Urbanisation in India: The story so far

India is currently undergoing a rapid pace of urbanisation. Cities are diversifying (with multiple industries) which will boost job growth. The strongest examples of this trend can be seen in rural areas. In other words, urbanisation is not just the further development of cities, but of rural areas as well. Thus, urbanisation is not just an inevitable process, but a trend that can be harnessed to push the Indian economy to a more desirable position. For this, infrastructural investment and development are required.

Does the Budget do justice?

An interesting article in Forbes India titled ‘Budget 2018: Agriculture matters, but how much?’ by Brian Carvalho, looks at the place urbanisation has an agriculture-focussed Budget. The politicians designed this Budget with their vote bank in mind. But serving the vote bank isn’t the same as serving the economy. The article takes help of the Economic Survey to prove its point, which is that agriculture cannot remain the dominant source of livelihood in an economy. The productivity and income generation of agriculture will never match those of production or services. Thus, to truly boost the economy, farm productivity must grow as the number of farmers reduces. A simultaneous focus on shifting those employed on the field to manufacturing or services will lead to rural growth. In that sense, although Arun Jaitley has emphasised on the importance of urbanisation, the numbers in the Budget have not done it justice.

Featured image source: Pixabay

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