By Qamar ZJ & Chandrima Mazumdar
While the 2015 idea of ‘100 Smart Cities Mission’ promised improved standards of living, the reality is that it has forced many people into poverty. Instead of acting as a role model for the tier 2 and tier 3 cities, the governance and financial implications of this urban renewal programme needs to be thoroughly re-examined, according to experts. Besides, this kind of approach is highly centralised, and gives little to no scope for state government intervention, making it highly non-inclusive, and also against the constitutional mandate. Importantly, the project is not in sync with the wider public aspirations. All of these issues were discussed in detail at an online workshop recently on the financial implications of ‘smart cities’ in India and their impact on urban futures. The event was organised by the Environment Support Group in collaboration with Harvard Kennedy School, USA; Helmholtz Centre for Environmental Research-UFZ, Germany; and Centre for Financial Accountability, New Delhi.
What are Smart Cities?
On June 25 2015, Prime Minister Narendra Modi launched the 100 Smart Cities Mission. The chosen cities would be made citizen-friendly, sustainable, and act as model areas to have a rub-off effect on the nearby cities and districts. The Indian cabinet approved Rs 98,000 crores for the development of these 100 smart cities, and the rejuvenation of 500 others. The 100 cities were to be chosen on the basis of a ‘Smart Cities’ challenge.
It is a five-year program in which, except for West-Bengal, all the states and Union territories of India are participating and have nominated at least one city for the Smart Cities challenge. As of January 2018, 99 cities had been selected to be upgraded as a part of the Smart Cities Mission (New Town Kolkata withdrew from the Mission).
Governance Challenges
Corporate leaders, politicians, bureaucrats and also science and tech communities are continually focusing on the smart cities as a go-to solution for the challenges of rapid urbanisation. These cities would be given the necessary help and funds to flourish as satellites to existing cities and metropolitan areas with plush infrastructure, ‘smart solutions’ and of course, ‘smart people.’ However, the truth is somewhere in between. Says Joe Athialy, the Executive Director of the Centre for Financial Accountability: “If you look at the past five years of the Smart City Mission, far from mitigating poverty, forced evictions have pushed more people into poverty”.
Threats to the 74th Amendment
Leo Saldanha of ESG, Bangalore mentions that the Indian constitutional mandate for a decentralised government is being completely sidestepped in this project, especially through the creation of the Special Purpose Vehicles (SPVs) which are the private limited companies through which the project is being implemented. He explained that the governance of the Smart Cities concentrates the power on the Central government, and almost bypasses the state governments. Tikender Panwar, former deputy of Shimla, terms the model as an obituary to the 74th amendment. He mentioned that the SPVs completely lack the participation of elected representatives. As a result, there have been conflicts in decision-making between them and the elected representatives, such as the city mayors.
Lack of inclusivity
Ramananda Wangkheirakpam of Indigenous Perspectives, Manipur, says that the lack of inclusivity is the biggest problem. In various public hearings, many social advocacy groups, mostly led by women, strongly raised their voices against the various flyovers, underpasses and footbridges because they would pose a threat to the functionality of women’s markets in Imphal (where the Smart City project is being promoted). These markets thrive on ground-level pedestrian access. While the project was being promoted as pedestrian-friendly, it was making the cities vehicle-friendly. “A concerning global trend is that rich investors are taking over cities,” says Wangkheirakpam.
Bhargavi Rao of ESG (Bangalore) and Centre for Financial Accountability (New Delhi) says that technology-based citizen engagement processes have an “embedded classism with an expressly stated anti-vendor, anti-hawker stance”. Instead of ensuring basic services, focus is being laid on technocratic development and beautification. Rao gave examples of how a wholly unscientific landfill is being built despite local protests. There are frequent delays in the payment of wages to sanitation workers, massive scale manual scavenging is not being addressed, while no action is being taken against Tumkur becoming a site for rampant dumping of mixed and hazardous waste. Incidentally, Tumkur is one of the ‘smart cities’, but Rao found various instances that highlight a gap between the wider public’s aspirations and what was being delivered through Smart City projects.
Financial implications
The biggest financial implication of the ‘smart cities’ project is the extensive privatisation and corporatisation. Out of the promised Rs 48000 crores for their development, until July 2019, only a third of the amount was released by the Centre. And only Rs 6160 crores were utilised by the cities, which is a mere 3% of the total costs estimated in 2015.
Asian Development Bank’s estimates that for India’s urban infrastructure deficit is about $230 billion per year. The Indian revenue systems are insufficient in closing these gaps, and according to the Prime Minister’s message, such gaps need to be closed by market mechanisms. This would entail relying on the private institutions and increased borrowing from national and international financial institutions. Athaily says that the major reason why the national and international corporations and financial institutions are expressing interest in the ‘smart cities’ project is because of this extreme reliance on them. There is a technocratic dependency on the power of smart technology and data analysis to deliver ‘smart solutions’. The reliance on the private sector only keeps increasing. Saldanha says that the intent of the decision-makers is to create a corporatized and technology-driven urban governance model.
Panwar talks about the alarming condition of State Financial Commissions. “These bodies are supposed to play a crucial role in the devolution of funds on a state and sub-state level for rural and urban local bodies under the 73rd and 74th constitutional amendments. Only 13 states are following the constitutionally-mandated timeline for creating new State Finance Commissions, while the average per capita devolution of funds by the Commissions continues to be minimal,” says Panwar.
Smart cities in Tamil Nadu
Dr. B Chandramohan, the Principal Secretary of the Government of Tamil Nadu, allayed some of the fears at the workshop by talking about his experience as the chairperson of Chennai Smart City Limited. He says that it is a misconception that the smart cities deviated from the local governance, mentioning that the SPVs were to remain accountable to the local bodies. He also stresses that the project was meant to be inclusive. For example, smart classrooms were to be built in corporation schools, so that high-end technology is accessible to even the lowest strata of society. “Smart Cities provide a platform for people to directly participate in choosing the Smart City of their choice,” he says. “In a country where elected representatives make decisions, for the first time, citizens had a direct say in how their cities should improve.” Dr. Chandramohan spoke of several other successful measures such as pedestrianism, water body and estuary rejuvenation, and the promotion of energy efficiency.
Smart cities in Germany
Nele Kress of the Helmholtz Centre for Environmental Research-UHZ, Leipzig, Germany says that just like in India, Germany’s view of ‘Smart cities’ is also rooted in corporatisation, globalism and technological solutionism. Unfortunately, both have neglected environmental sustainability, leave out the marginalised, and focus on the affluent. However, Germany doesn’t have a nationally-pronounced Smart City mission or strategy like India, with the cities still maintaining a greater level of autonomy.
“Smart cities are financially unsustainable”
On the second day of the workshop, Gaurav Dwivedi of the Centre for Financial Accountability highlighted a major mismatch in financial estimations. While the 100 cities picked for the ‘smart cities’ mission had submitted proposals worth Rs 2.05 lakh crore, the Ministry of Urban Development had estimated it to be Rs 7 lakh crore. Dr Carol Upadhya of the National Institute of Advanced Studies, Bangalore, pointed out the frailties of the Amaravati Capital City Project in Andhra Pradesh. Calling this project as a “neoliberal process based on policies pushed by international organisations like the World Bank”, she says that land pooling is being used as a ploy to generate financial muscle to centrally-determined projects to get around the restrictions of the Land Acquisition Act. “The Capital Region Development Authority had control over the project and the state, disregarding the laws of the land,” she said about the ‘deeply flawed idea’.
Ravikant Joshi, an independent consultant in urban finance and governance, observed that the sustainability of smart city proposals and the financial capability of the cities are blatantly ignored. “Out of the 100 smart cities, 31 do not have investment grade credit ratings,” he said. “Smart City Mission’s financial implications on municipal budgets will be very skewed and will be negative in most of the cities, making them financially unsustainable”.
Privatisation of water and sanitation
Sitaram Shelar of the Centre for Promoting Democracy, Mumbai, said that none of the Smart City Projects are new, and are instead a repackaged unit of existing policies. He highlighted the commoditization of water and sanitation in Smart City Projects. Udaipur’s sewage treatment plant’s (STP) budget of Rs 80 crore for a 15-year contract is not financially viable for the city, he says. Similarly, Coimbatore cannot afford Rs 500 crore over a 25-year period. “Smart cities are pushing the privatisation of water and sanitation,” he said.
Negate existing land laws
“Developing 5-10% of a city through the Smart City Mission (SCM) is hugely problematic and unsustainable as the same investment cannot be made for the rest of the city,” says Marina Joseph of Youth for Unity and Voluntary Action, Mumbai. Besides, the SCM ‘completely overrides and negates existing laws on land tenure and planning’. Instead, she suggested “in-situ incremental housing provided to people with land tenure” as it was more sustainable.
“Small-scale cannot translate to large-scale”
While the SCM’s mission is to create a model city, the idea is untenable. Says G Mathi Vathanan, Principal Secretary, Urban Development, Government of Odisha: “When you are trying to create something ideal on a small scale, the question is how far it can be replicable and scalable both within the city and across cities”. However, he did concede that there were several positive outcomes of SCM and can therefore be replicated, there are some that “may need to be dropped”. Besides, he said that one policy does not fit everyone in the country. “Not all cities are ready to adopt the technology template under the SCM due to the variations across cities in size, geography, and climate,” he said.
“Can’t completely reject smart cities”
Prof Sheila Jasanoff, Pforzheimer professor of Science and Technology Studies at the Harvard Kennedy School, USA, said that it would be a mistake to look at smart cities as utopic, but equally so to reject them completely. However, she did say that farming had now become all about land acquisition and land grab. “Instead of smartness, sustainability or sustainable smart cities should be the watchword for future urban planners,” she said.
Leo Saldanha observed that through the smart cities mission, the central government was attempting to create utopic islands of perfection. “Is the state imagining for the people or is capital influencing the state’s imagination for the people?” he asked. “Is the democratisation of smart cities possible? Will the constitutional promise of inclusivity be integrated into the smart city mission?”
