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    Smart Cities Mission is still very much a work in progress post three years of its launch

    Synopsis

    Between January 2016- 2018, the govt selected 99 cities through a competitive process and ranked them. ET takes a look at numbers ahead of SCM's third anniversary.

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    The initiative is significant because it allows debt-ridden urban local bodies an alternative to making their cities future-proof.
    The Narendra Modi government on June 25, 2015, unveiled with much fanfare the Smart Cities Mission (SCM), one of its marquee initiatives aimed at upgrading 100 cities.

    The Union government agreed to give each of the cities Rs 100 crore every year for five years, with an equal contribution coming from the state government and the urban local body combined. SMC is carried out through a special purpose vehicle (SPV), registered under the Companies Act, 2013, instead of through a municipal corporation, and also encourages private investment.

    Among the projects in SCM are affordable housing, integrated multi-modal transport, creation and preservation of open spaces, and waste and traffic management, among others. The projects focus either on a particular area of the city or the entire city.


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    Between January 2016 and January 2018, the government selected 99 cities through a competitive process, based on their plans, and ranked them. Shillong, the 100th city, has not been added to the list since it has not submitted its plan.


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    The initiative is significant because it allows debt-ridden urban local bodies an alternative to making their cities future-proof. It is also to be seen in the context of the fact that India, a third of whose population lives in urban areas, will add 404 million city dwellers between 2014 and 2015, compared with China’s 292 million, according to the United Nations. As the third anniversary of the SMC approaches, ET Magazine takes a look at the numbers:

    All smart cities cannot be at the same level of implementation: Hardeep Singh Puri
    The Smart Cities Mission is a flagship scheme under the Ministry of Housing and Urban Affairs. In an interview, Minister of State (Independent Charge) Hardeep Singh Puri says the implementation has been among the fastest globally. Edited excerpts:

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    On the criticism about the slow progress of SCM
    When I look at the figures from the ministry’s point of view, I think it’s one of the fastest implemented projects of its kind anywhere in the world. But the narrative outside is not in sync with this. One explanation is that people seem to overlook the fact that of the 99 smart cities, 20 of them were declared in January 2016 and the last nine were declared in January 2018. All smart cities cannot be at the same level of implementation. What is also not understood is a smart city, unlike a normal city, requires a cutting-edge project management consultant and it also requires a special purpose vehicle (SPV). Both these, either jointly or sequentially, can take anywhere from 15 to 18 months to be put in place. You have to identify a project which the SPV will do in consultation with stakeholders, and then you have to use cutting-edge technology to do that. But it’s not all about technology. Another misnomer is that this is science fiction. Ninety out of the 99 cities are brownfield projects, which means the smart city will emanate from the existing city.

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    On the fund utilisation rate being just 1.8%
    That’s not correct. The way to do it is to see what the expenditure outflow has been. Those of us who have worked in the government know that a utilisation certificate is given two years later (on completion of the project).

    On the conflict between the SPV and the municipal corporation concerned
    No conflict of interest has to take place. That is why I’m not happy with the additional chief secretary and additional urban affairs secretary or the additional commissioner of the municipal corporation doubling up as the SPV manager. When a project starts, there is no problem because it can sometimes be an advantage with the same person handling both. But once it takes off, there should not be any conflict of interest. We will crack the whip on that.

    On learning from other parts of the world
    There have been learning and contributions from global experience in developing smart cities. The first part of selecting the cities was a big issue. Bloomberg Philanthropies guided us to conduct a challenging process and have citizen engagement to impartially select 100 smart cities. It was a remarkable contribution. Area-based development is a unique feature of the Smart Cities Mission, which uses integrated planning approach. Recognising this, the Bhubaneswar Smart City plan was given the American Planners Association award 2017. Cities like Barcelona (Spain) and Marseille (France) have been trying to become smart cities for the past 15 to 20 years. With this reference, India’s Smart Cities Mission can be credited for showing an impact.

    On financing
    An innovative feature of the mission is that our municipal bodies need to leverage their financial resources by municipal bonds, value-capture finance, publicprivate partnership (PPP), multilateral loans, etc. It is noteworthy that 98 projects, costing Rs 6,000 crore, are under implementation through PPP. Those projects are getting good responses, not only in the big cities but even in the smaller towns. Making urban local bodies financially self-sufficient is very important for sustainable development. As you are aware, our ministry has also started a campaign to do credit rating of cities, which has been completed in 412 cities. I am happy to note that 155 cities have investment grade with more than BBB(-) grades and 34 cities have more than A(-) grades. I have personally been encouraging more cities to explore municipal bonds towards their financial sustainability. Cities like Pune and Hyderabad have already issued municipal bonds.




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    Subscribe to The Economic Times Prime and read the ET ePaper online.

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