Economy, demography are key factors in selection of smart cities

Economy, demography are key factors in selection of smart cities

By ANANDO BHAKTO | NEW DELHI | 23 April, 2016
Depiction of a Smart City at the Trade Fair in Pragati Maidan, New Delhi in November 2015. Photo: Wikipedia
Phase 1 of the Smart Cities Mission chose 20 cities for financing, while the rest were asked to improve their deficiencies by the Apex Committee in the Ministry of Urban Development for participation in the next two rounds of competition.
The demographic spread and economic activity of a city are important parameters for qualifying in the country’s ambitious Smart Cities project, experts have said, pointing out that these variables considerably influence the quality of administrative services in a city.
“The demographics, i.e. the working age population as percentage to the total population, density and the economics of the city, in particular the presence of industries that employ the workforce, are two very important determining variables. These three variables determine whether the city has the financial firepower to provide and maintain (meet capex and opex) of the city administration services,” Shashanka Shekhar Panda, CEO, Blue Earth Enterprise, told The Sunday Guardian. Blue Earth Enterprise has worked with NIUA in the recent past on organising a workshop on Sustainable Energy Integration in Smart Cities.
He said that if a city is big in size with low demographic quality, low density, and low economic activity then the city administration would struggle to that extent as compared to a city of same size, high demographic quality, moderate density and high economic activity. Experts too believe that a city’s eligibility for the Smart Cities Project, at least in the infrastructure parameter, is vis-a-vis its demography and economic activity, since economic development is the “final answer to good city administration”.
On Friday, the Ministry of Urban Development received the revised plans of 23 cities, including 15 capitals, and they would be evaluated by 15 May. These 23 cities had failed to make it to the list when the list of 20 cities from 12 states and Union Territories was announced after evaluating the proposals of 97 cities in the first round. In the first round, results of which were announced on 28 January, Bhubaneswar was ranked number one and Bhopal was placed at number 20. Shashanka said that these 23 cities will now be assessed under Stage I and Stage II criteria. “Stage I criteria includes Existing Service Levels (sanitary infrastructure, IT-enabled city administration, financial monitoring and management systems and citizen interface mechanisms), Institutional Systems and Capacities (service delivery parameters, internal revenue generation), Self-financing (ULB salary payments, audited accounts, tax revenue percentage as a part of ULB budget, percentage of water supply cost met by user charges), Past Track Record and Reforms (capital works that were self funded in percentage, city level JnNURM reforms achieved and projects completed on time). Stage II criteria would be Credibility of Implementation, City Vision and Strategy, Impact of proposal, Cost Effectiveness, Innovation and Scalability, Process Followed. There would be varying weightage for each parameter,” he told this correspondent.
Since only 12 states and UTs were represented in the first list of 20 mission cities announced earlier, the Ministry offered an opportunity to the highest ranked city in the first round of competition in each of the unrepresented 23 States and UTs to participate in Fast Track Competition in pursuance of the principle of urban transformation across the country. 
A source in the Urban Development Ministry told this newspaper, on condition of anonymity, that the Ministry has already urged the 20 Smart Cities selected in the first round of competition to quickly firm up bankable projects for obtaining loan assistance from the Asian Development Bank (ADB), the World Bank and the BRICS Development Bank, confirming the experts’ opinion that economic activity is a major criteria.
Meanwhile, the regular second round of City Challenge Competition for the remaining 97 cities (included in the Smart City Mission) got underway on 1 April and these cities have been asked by the UD Ministry to submit revised smart city plans by June end. Experts believe that given the multiple parameters and the sub-parameters involved, the criteria for shortlisting will be detailed and granular. “An all round performance would be necessary. Even so, conceptually, cities with a strong city administration in terms of both management and delivery of basic public goods such as water and sanitation as well as financial management, especially self-financing aspects, would be of utmost importance,” Shashanka reaffirmed.
While 20 smart cities were selected during 2015-16 as per the Mission Guidelines, another 40 would be selected during 2016-17 and the remaining 40 during the next financial year. 
Each city selected in different rounds of competition will be given Central assistance of Rs 200 crore in the first year and Rs 100 crore each during the subsequent three financial years. State governments and respective urban local bodies will provide matching funds to the same amount. Accordingly, each mission city would get a total assistance of Rs 1,000 crore over a five-year period.
 

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