100 Smart Cities and 500 Rejuvenated Cities
Appearing at http://smartindiancities.com/newsdetail.aspx?newsid=225
The cabinet approval for central
funding for the 100 Smart Cities and the 500 Rejuvenated Cities is like nector
(AMRUT) for the economy of this country as well as providing a growth engine
for the global economy.
To put the magnitude of impact
that this decision has, it is important to keep the macro perspective in place.
The total cost of upgradation and renewal of 500 cities is estimated to be
roughly around USD 5 trillion. However, this amount will not get spent or
consumed within one or two years. This initiative and the related expenditure,
will be executed over atleast a twenty year horizon. However, what is critical
is to start of the process and to create upgraded cities that have a
demonstration effect.
Therefore, the roughly USD 16
billion committed for the initial central government spend is an important
first step towards unlocking the larger, longer term economic activity of
upgrading and building smart cities/ rejuvenated cities. Moreover, the
initiative will trigger a virtuous cycle of efficiencies being unleashed in the
economy due to the building of efficient cities and if this is combined with
the Make In India initiative, then the multiplier effect of the spend in
building these cities is also captured within the Indian economy, thus
propelling the country to an even faster growth rate. If the initiative stays
on track and gains the expected momentum, it would lead to an explosive growth
in the Indian economy.
What is more heartening to note
is that this initiative will also provide the much needed growth impetus to the
global economy. Vast amounts of steel, cement, electronics, furnishings,
electrical equipment, sewage plants etc will be required to build these cities.
Not all of this will be available in India in the short term. Thus, some of
these requirements will be imported from the world over, triggering growth in
the global economy.
However, what is important to be
noted is that it would be unfair to expect that the bulk of the funding
required will come from the Government. This is not going to happen simply
because the government does not have the required funds. Thus, what is expected
is that the initial government funding will trigger private participation in
the funding of further development of cities. Large scale Public-Private
Partnership would presumably be the larger source of funding for the 100 smart
cities and the 500 rejuvenated cities. And the economic growth that is expected
to be triggered, will also help in providing the funding required to build the
rest of the cities.
It is obvious that this cabinet
decision is historic for not just the growth of the economy but also will have
a deep impact on how we live and work, improving our Ease of Living.
SMART is an international initiative involving 12 partner organizations from 7 different regionsacross the Central Europe - Vienna (AT), Stuttgart (DE), Venetto region (IT), Modena (IT), Budapest (HU), Bratislava (SK) and Prague (CZ)
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