The Case For Foreign Companies Preparing Smart City Plans

India's urban cities are more productive than its rural areas. In Mumbai, for instance, productivity of a resident is nearly 60 per cent higher than that of an average Indian. But, large global cities are many times more productive. To be more prosperous, the Indian cities could work towards becoming more productive. Now, it may seem that increasing the productivity of cities is a long, time-consuming process. But, this is not completely true. Cities such as Hong Kong, grew in a short period of time because they adopted rules that were formulated by foreign governments.

Union Urban Development Minister M Venkaiah Naidu recently said that the global interest in India's smart cities mission was huge. Nearly 14 major nations have expressed interest in the mission. "Think of Ecorys Nederland BV of Netherlands coming forward and winning the bid to prepare City Plan for Bhagalpur in Bihar, Tractebel Engineering SA of Belgium being associated with smart city plan of Dharmashala in Himachal Pradesh, Haskoning DHV Consulting of Netherland with the little-known Dahod in Gujarat, Mott MacDonald of United Kingdom with Jaipur, Deloitte Touche Tohmatsu of Japan with Bidhannagar in West Bengal, Data World of South Africa with remote Namchi in Sikkim," Naidu said.

Why is this important?

At present, much of modern technology that we use in construction, is imported from outside India. Without modern technology, we could not have achieved the level of productivity we have in Indian cities. But, importing technology from wealthier nations is easier, what is more difficult are the import rules. But, without more efficient rules, Indian cities are unlikely to prosper further.

Gurgaon is known as India's Singapore. But, Gurgaon would not have flourished without the city's land use policy that made acquisition of property in Gurgaon easier. Easier land acquisition also made construction of roads and highways easy in Gurgaon. The reason was that much of the land in Gurgaon was sparsely populated and there were fewer constraints before converting such agricultural land for commercial or industrial purposes. This allowed greater development of real estate in Gurgaon. This would not have been possible in a city like Mumbai. So, allowing foreign governments to create smart city plans for obscure mission cities in India may lead to similar results.

Road congestion is a problem in all major Indian cities. This is especially true of cities such as Gurgaon and Mumbai where the number of cars added to roads every year is very high. But, it would be difficult to impose rules such as congestion pricing for roads in a major city, because it is difficult to change existing rules. But, in a relatively unknown mission cities like the ones Naidu mentioned, it may not be as difficult to implement master plans created by foreign companies.

When such cities become successful, people in other parts of India will be free to move into them. This may improve policy across the country, nudging other local authorities to emulate successful smart cities.