Strategic investment is rising, but citizen-led behavioural solutions a must

Aspirations visible in urban India today can be traced to strategic investments made in the last seven years through four major urban programmes

With 53 million-plus cities, including five megacities (those with a population of more than 10 million), urban India is home to about 500 million people, more than the population of the United States or the European Union. From highway connectivity to sleek railway stations, metro trains to new airports, cleanliness to app-delivered services, rooftop solar to e-vehicles, and UPI payments to startup hubs, development in India’s cities has gained unprecedented momentum. The Union ministry of housing and urban affairs’ budget has increased multifold from ₹1,7500 crore in 2014 to ₹77,000 crore in 2022. Thus, urban investment in India has embarked upon an upward trajectory like never before. This investment has created physical infrastructure and a conducive environment for realising the entrepreneurial dreams of young people. In addition, the National Infrastructure Pipeline envisages an investment of about ₹20 lakh crore in the next five years in urban infrastructure.

Realising the importance of urban infrastructure, states are also investing in infrastructure development. Put together, states have allocated a record budget of more than ₹1.5 lakh crore for urban development in FY 2023. (ht photo)

Aspirations visible in urban India today can be traced to strategic investments made in the last seven years through four major urban programmes. The Atal Mission for Rejuvenation and Urban Transformation (AMRUT), involving more than 5,800 projects related to water, green spaces and mobility, invested about ₹4 lakh crore. The Pradhan Mantri Awas Yojana Urban (PMAYU), which aims to construct 12.2 million houses, has made an investment of about ₹2 lakh crore. The Swachh Bharat Mission Urban (SBMU), which tackles sanitation and waste management, has invested ₹2 lakh crore. Over seven million household toilets have been constructed under SBMU in the last seven years. In addition, an enormous infrastructure for waste collection, segregation and processing has been created under this scheme. The Smart Cities Mission, under which thousands of projects are in various stages of completion, has an outlay of ₹2 lakh crore. Together, these four programmes have already invested more than ₹7 lakh crore in 324 cities since 2015.

Realising the importance of urban infrastructure, states are also investing in infrastructure development. Put together, states have allocated a record budget of more than ₹1.5 lakh crore for urban development in FY 2023. In addition, many districts are raising funds through municipal bonds. This manifests into a massive investment landscape in Indian cities which holds the potential for unprecedented economic growth.

Keeping all sections of society in mind, urban investment has been prioritised in sanitation, affordable housing and metro projects. Every city is ramping up its waste treatment infrastructure. In 22 cities, metro projects have been completed or are in the process of completion. In the last few years, the strategy of urban investment focused on citizen-centric development. This tackled legacy problems such as open defecation but also created futuristic infrastructure. To enhance capacity, efficiency and transparency in urban governance, various portals such as India Urban Data Exchange, National Urban Learning Platform, and Smart Code have been launched while the National Urban Governance Platform is under development under the National Urban Development Mission.

However, this investment is insufficient to deal with the problems of rapid urbanisation. Water scarcity, pollution and congestion are enormous challenges that require innovative financial, technological and behavioural solutions. Besides Union, state or municipal budgets, private investment should flow into cities to create user-fee-based infrastructure. For example, keeping water consumption unaccounted and unbilled is a fiscal and environmental fallacy. Climate-resilient cities require the proactive participation of citizens. The Lifestyle for environment (LiFE) movement launched recently paves the way for behavioural investment, which is as important as financial investment in cities. Such a combined approach is likely to be the way forward for urban rejuvenation in India.

Kundan Kumar is adviser, NITI Aayog, and Rajesh Gupta is director, NITI Aayog. The views expressed are personal