India's growth story can be marred in the absence of a proper road map on how to overhaul the country's dilapidated urban infrastructure seems to be finally dawning upon the union urban development ministry.
The ministry has, for the first time, prepared a comprehensive blueprint on the challenge faced by Indian cities in light of the growing urbanisation and how it plans to tackle these concerns in the next five years.
A 2010 report by Mc Kinsey & Company, a global consulting firm has projected that India's urban population would grow from 340 million in 2008 to 590 million by 2030.
The strategy plan of ministry of urban development for 2011-2016 lists lack of funds as well as capacity of municipalities to carry out urban reforms, inadequate investment in building urban infrastructure, inadequate level of empowerment of municipalities across the country, a poor monitoring mechanism of schemes that are implemented as some of the key reasons responsible for the existing urban decay.
The vision document talks of a bigger role for private players to invest in developing/ upgrading urban infrastructure. Public-private partnerships (PPP) is a key element of the ministry's overall strategy. A special purpose fund — PPP urban infrastructure fund — has been envisaged to address the lack of any national level, urban focused institutional mechanism to actively engage in capacity building, project identification, development, structuring and funding bankable PPP projects in the urban infrastructure.
According to Mc Kinsey, India's per capita spending on urban infrastructure is Rs 777, which is just 14% that of China's Rs 5304.
Even, the 11th Five Year Plan of India (2007-2012) had estimated a total fund requirement of Rs 1.29 lakh crore to augment basic urban infrastructure. As against this, the actual investment has been to the tune of just Rs 0.45 lakh crore in the last year of the 11th Plan.
Though a bit late in the day, experts welcome the move to have a five year road map for the urban sector.