Ajai Sreevatsan reviews Financing Cities in India: Municipal Reforms, Fiscal Accountability and Urban Infrastructure by Prasanna K. Mohanty
India’s cities are miserable places to live in. We may dream of smart cities, but our cities are currently rather un-smart. Even basic necessities like piped drinking water and access to a rudimentary sewage network are out of reach for most Indians living in urban areas. Despite the deep political divides in the country, the one thing on which there is broad consensus is this: India’s cities require a lot of work.
The remarkable popularity of a pie-in-the-sky idea like 100 Smart Cities is rooted in that imagination. That urban India deserves better. P.K. Mohanty’s Financing Cities in India is a timely intervention that seeks to address this growing sense of frustration among citizens living in urban India.
The author’s case is fairly straightforward. Cities are the engines of economic growth. Owing to a variety of factors ranging from availability of skilled manpower to the benefits of agglomeration, much of India’s future growth is expected to come from its cities. By 2030, India’s cities are expected to contribute nearly 70% of the GDP, according to a McKinsey Global Institute analysis.However, very little investment goes back into those very cities.
Overlooking questions of feasibility on all those three points though, the bigger concern with the book is that it ultimately reduces the issue to a money problem. But as the author himself would know, having worked extensively on Hyderabad as an IAS officer during Chandrababu Naidu’s earlier term, what is possible at any given moment is not just a question of funds. A case in point is that only around 40% of the funds originally allocated for JNNURM were released. Many proposed projects were either not started or remain incomplete as they got stuck in the Centre-State-city administrative vortex.
India suffers from a serious local democracy deficit. Without fixing that, throwing money at the problem may not help. In the book, a small section deals with good governance in the concluding pages. But good governance is just a catchphrase that has come to mean so many different things for different people. Without serious introspection about the nature of our urban democratic governance, innovative taxes and user charges may not help much. The real opportunity that Indian cities offer is a chance to build a better democracy, where there is considerable local autonomy and government spending is transparent and accountable. While lack of funds is a concern in that equation, it may not after all be the central concern.