making urban india sustainable: framing a theory of …making urban india sustainable: framing a...

MAKING URBAN INDIA SUSTAINABLE: Framing a Theory Of Change

JAGAN SHAH Senior Infrastructure Adviser

Department for International Development, UK Government British High Commission, New Delhi

SANTA FE INSTITUTE-MANSUETO SUMMER SCHOOL

July 22, 2019

Santa Fe, New Mexico, U.S.A.

India in the SDG Report 2019

India Dashboard in the SDG Report 2019

Urban relevant SDG indicators in India Dashboard 2019

1951

> 5

1 - 5

0.5 - 1

0.1 – 0.5 < 0.1

Population Size (millions)

Source: CoI (1971-2011)

Source: Indian Institute of Human Settlements (IIHS)

Kolkata (15.5)

Delhi (16.9)

Chennai (7.5)

Bangalore (7.2)

Hyderabad (6.7)

Ahmadabad (5.7)

Mumbai (20)

2011

> 5

1 - 5

0.5 - 1

0.1 – 0.5 < 0.1


Source: CoI (1971-2011)


Mumbai (28.6)

Kolkata (22.3)

Delhi (24.4)

Chennai (11.1)

Bangalore (10.6)

Hyderabad (9.9)

Ahmadabad (8.5)

Pune (7.4)

Surat (6.3)

Kanpur (5.1)

2031

> 5

1 - 5

0.5 - 1

0.1 – 0.5 < 0.1


Source: CoI (1971-2011)


How Urban is India? Economic Survey 2016-17, Government of India

‘Messy’ and ‘hidden’ urbanization World Bank, 2015

Footprint of sprawl National Capital Region of Delhi

‘Analysis of Public Policies That Unintentionally Encourage and Subsidize Urban Sprawl’, Todd Littman, New Climate Economy, March 2015

‘Costs of business as usual’, from Cities and the New Climate Economy: The Transformative Role Of Global Urban Growth, November 2014

1. An increase in the urban infrastructure investment gap and the failure of many cities to deliver basic urban infrastructure and services. • In India, the gap in urban infrastructure investment is estimated at USD 827 billion upto 2030, with around 67% of this needed for urban roads and traffic support. Under business as

usual, 2.5 billion square metres of roads will need to be paved in India - 20 times the capacity added in the past decade (McKinsey Global Institute 2010)

2. Growing financial and welfare costs related to traffic congestion • The costs of lost time and increased transport costs are estimated at 2–5% of GDP in developing countries in Asia and Latin America (ADB 2012)

3. Escalating economic and social costs due to air pollution • A study of 311 cities, with over 1.5 billion people, suggests that 86% of the cities exceed WHO AQ guidelines and led to 730,000 premature deaths (Kuylenstierna, Vallack et al. 2014)

4. Lock-in of inefficiently high levels of energy consumption • A study of 50 cities worldwide estimates that almost 60% of growth in expected energy consumption is directly related to urban sprawl - more than the consumption related to

increases in GDP and demographic changes (Bourdic, Salat et al. 2012)

5. Increasing social exclusion through growing income and wealth inequalities in rapidly urbanising countries • Combined effects of urban sprawl, motorisation, growth of informal settlements and gated communities are increasingly creating socially divisive cities (UN-Habitat, 2011)

6. A wide range of other economic and social costs • Related to road safety, community severance, low activity levels with health implications, reduced ecosystem services and food security (WHO, Embarq)

7. The over production of construction materials needed for more sprawling cities • Construction sector accounts for over 30% of global resource consumption; between 1900 and 2005, material resource use in the world increased eight-fold, almost twice the rate of

population growth (UNEP 2011)

8. Lock-in of higher operational emissions from buildings and transport for decades and centuries to come • Carbon emissions from transport alone projected to almost double by 2050 (IPCC 2014)

Salient features of urbanization in India

Global flows of remittances in 2017

No Milestones

1 Creation of ULB website

2 Publication of e-newsletter

3 Support to Digital India (ducting to be done on PPP mode by the ULB itself)

4 Online registration of Birth, Death and Marriage

5 Online collection of Water & Sewerage Charges

6 Online Grievance Redressal system

7 Online Property Tax collection portal

8 Online Advertisement tax payment service

9 Online Issuance of Licenses

10 Online Building Plan Permissions system

11 Online property title mutation system

12 Online payroll disbursement system

13 Online Pension disbursement system

14 e-procurement system in place

15 Policy for engagement of interns in ULBs, and implementation (numbers engaged in previous year)

16 Establishment of municipal cadre (posts created and filled in 3 categories: administration, technical, finance)

17 Ensure system for cadre-linked training (MOU with institute/s + numbers trained)

18 Complete migration to double entry accounting system and obtaining an audit certificate to that effect from FY2012-13 onwards

19 Publication of annual financial statement on website

20 Appointment of internal auditor (selection of auditor and publication of report)

21 Preparation of Service Level Improvement Plans (SLIP), State Annual Action Plans (SAAP)

22 Action plan to progressively increase Green cover in cities to 15% in 5 years

23 Development of at least one Child-friendly Park every year in AMRUT cities

24 Establish a system for maintaining of parks, playgrounds and recreational areas relying on People Public Private Partnership (PPPP) Mile

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MUNICIPAL REFORMS TO BE IMPLEMENTED IN 5 YEARS (2016-20) INCENTIVE AMOUNT INR 70 BILLION (USD 1 BILLION)

Strengthening the Municipality: “Reform, Perform, Transform”

No Milestones 25 Identify energy efficiency projects

26 Ensure transfer of 14th FC devolution funds to ULBs

27 Appointment of State Finance Commission (SFC) and issuance of Action Taken Reports

28 Transfer of all 18 functions to ULBs

29 Implementation of SFC recommendations within timeline

30 Periodic revision of building bye laws

31 Creation of Single Window system for all approvals required to obtain building permission

32 Adoption of Model Building Bye-Laws (2016)

33 Establish and operationalize financial intermediary for Pool Finance, access to external funds, and floating of municipal bonds

34 Property Tax: at least 90% coverage

35 Property Tax: at least 90% collection

36 Make a policy to periodically revise property tax, levy charges and other fees

37 Post the Demand Collection Book (DCB) with tax details on the website

38 Achieve full potential of advertisement revenue by making a policy for destination specific potential having dynamic pricing module.

39 Adopt a policy on user charges for individual and institutional assessments in which a differential rate is charged for water use and adequate safe guards are included to take care of the interests of the vulnerable.

40 Make action plan to reduce water losses to less than 20 % and publish on the website,

41 Separate accounts for water charges

42 Water charges: at least 90% billing

43 Water charges: at least 90% collection.

44 Complete the credit ratings of the ULBs

45 Energy (Streetlights) and Water Audit (including non-revenue water or losses audit),

46 Making STPs and WTPs more energy efficient

47 Optimize energy consumption in street lights by using energy efficient lights and increasing reliance on renewable energy

48 Systems established for Waste Water Recycling and Faecal Sludge Management Mile

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Reforms achieved in 220 cities in 25 States and 3 Union Territories (4 states and 3 UTs not covered)

Source: 14 FC Support Cell at NIUA

• Per Capita Own revenue (tax + non tax) has increased at much faster rate—14.27% annually during 07-08 to 15-16 compared to 6.96% during 02-03 to 07-08.

• Grants have been found to be increasing at a even higher rate than own revenue with 18.36% between 07-08 to 15-16 and by 18.69% between 02-03 to 07-08.

• Since the base was lower in 07-08 for Own revenue compared to Grants, the per capita own revenue stands at Rs 1057.67 compared to Rs 2183.46 in 2015-16.

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India (Avg.) excl. Maha.2002-03 India (Avg.) excl. Maha.2007-08 India (Avg.) excl. Maha.2015-16

All India (Average) Urban Local Bodies- Income

PC TX PCNTX PC GRNT

FIXING MUNICIPAL FINANCE (insights from the 14th Finance Commission)

• Throughout the country, revenue expenditure is higher than Own Revenue earnings.

• Per Capita Revenue expenditure is Rs.1697.05 against Own revenue of Rs. 1057.67 whereas PC Capital expenditure is Rs. 1617.14 for 15-16.

• Capital expenditure cannot be met from Own Revenue.

• A part of Revenue expenditure (37.7%) and whole of Capital expenditure is dependent on external Grants (State and Centre).

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India (Avg.) excl. Maha.2002-03 India (Avg.) excl. Maha.2007-08 India (Avg.) excl. Maha.2015-16

All India (Average) Urban Local Bodies - Income & Expenditure

PC REV EXP PC CAP EXP PC TX PCNTX PC GRNT

Source: 14 FC Support Cell at NIUA

FIXING MUNICIPAL FINANCE (insights from the 14th Finance Commission)

Estimate by the High-Powered Expert Committee, 2011: INR 39.2 Trillion (~USD 0.5 Trillion)

• Does not include Primary Education, Primary Health, and Electricity Distribution; also does not include land cost

• Additional INR 20 Trillion (~USD 0.3 Trillion) required for operation and maintenance of assets- old and new

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Projected urban infrastructure investment requirement (2010-30)

Urban Infrastructure Investments portfolio Ministry of Housing & Urban Affairs, Government of India

Economic Survey of India 2018-19

1. Shifting Gears: Private Investment as the Key Driver of Growth, Jobs, Exports and Demand

• Last Five Years: The Accomplishments

• The Next Five Years: A Blueprint for Growth and Jobs

• Going beyond the economics of "equilibrium" in the blueprint

• Navigating a world of constant dis-equilibrium

• Major Factors, Reforms and Risks

2. Policy for Homo Sapiens, Not Homo Economicus: Leveraging the Behavioural Economics of "Nudge"

• The Influence Spectrum of Public Policy

• Successful Applications of Behavioural Insights in India

• Principles for Applying Behavioural Insights to Public Policy

• An Aspirational Agenda for Path-Breaking Change

• Implementing the Aspirational Agenda for Behavioural Change

3. Nourishing Dwarfs to Become Giants: Reorienting Policies for MSME Growth

• The Bane of Dwarfism and Its Impact on Jobs and Productivity

• The Role of Policy in Fostering Dwarfism

4. Data "Of the People, By the People, For the People" • The Economics of Data and Social Welfare • Why Must Data be Treated as a Public Good • Building the System • Transforming India's Data Infrastructure

9. Enabling Inclusive Growth through Affordable, Reliable and Sustainable Energy

• Energy for Prosperity • Access to Energy-Energy Poverty • Energy Efficiency • Impact of Energy Efficiency Programmes • Energy Saving Potential of Various Sectors • Sustainability of Energy Generation • Potential of Renewable Energy • Electric Vehicles (EVs) In India

Economic Survey of India 2018-19

TOWN PLANNING SCHEMES The positive potentials in cooperative action: Town Planning Schemes in Gujarat

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Positive impacts of national Infrastructure investments: The Golden Quadrilateral and rise in district GDP (Ejaz Ghani and ors, World Bank, 2013 onwards)

1. Building physical and social infrastructure • Push all forms of physical connectivity (roads with new tech, gas grids, water grids, i-ways, and regional airports) • Provide affordable Housing for All; promote rental housing • Joint development and concessions based on government lands • Suburban railways through Special Purpose Vehicles, Metros through PPP, Transit Oriented Development (TOD)

2. Digital India reaching every sector of the economy

3. Pollution free India with green Mother Earth and Blue Skies

4. Make in India • MSMEs, Start-ups, defence manufacturing, automobiles, electronics, medical devices; sunrise and advanced technologies (Semi-conductor

Fabrication (FAB), Photo Voltaic cells, Lithium storage, charging infra) • Faster Adoption of Electric Vehicles • ‘Scheme of Fund for Upgradation and Regeneration of Traditional Industries’ (SFURTI) • Scheme for “Promotion of Innovation, Rural Industry and Entrepreneurship” (ASPIRE): 80 Livelihood Business Incubators (LBIs) and 20 Technology

Business Incubators (TBIs)

5. Water, water management, clean Rivers

6. Blue Economy

7. Space programmes: Gaganyaan, Chandrayaan (manned moon vehicle), Satellite programmes

8. Self-sufficiency and export of food-grains, pulses, oilseeds, fruits and vegetables

9. Healthy society – Ayushman Bharat (Healthy India), well-nourished women & children, safety of citizens

10. Minimum Government Maximum Governance: ‘Team India’ combined with ‘Jan Bhagidari’ (peoples participation) • Social Stock Exchange: an electronic fund-raising platform for social enterprises • Brownfield asset modernization strategy: Infrastructure Investment Trusts (InvITs), Real Estate Investment Trusts (REITs), PPPs

Finance Minister’s Budget Speech, July 2019: “Ten points of Our Vision” (Attain a USD 5 Trillion economy by 2030; 10 Trillion by 2050)

• Sustain integrated planning and holistic investments: CONVERGENCE

• Promote e-Governance: TRANSPARENCY

• Promote informal sector and SMEs: INCLUSION & DIVERSITY

• Decentralize planning & management: DEVOLUTION

• Measure resources and consumption: DECOUPLING

• Enhance public participation: TRUST

• Promote ‘Triple Helix’ partnerships: GOV. + IND. & BUS. + INST.

• Support Entrepreneurship and Innovation: INVEST IN CHILDREN, YOUTH, ELDERS

KEY PRINCIPLES FOR SUSTAINABLE URBAN TRANSFORMATION

Creating a “Theory of Change” and Log Frame for Sustainable Urbanization in India

EVIDENCE/ INSIGHT • Distributed system of ~8000 cities within ~660 districts across diverse climatic and geographic regions • Urban system is within larger systems (human, physical, ecological) and interdependent with more than 60,000 villages • Uneven development and growth is forcing 1/3 of the population into distress migration • Cities are the chief drivers of the Indian economy; but unplanned urbanization and massive poverty and inequalities abound • Land management systems are chronically weak; land-grabbing and alienation are rampant

• Infrastructure creates jobs and opportunities during its development and enables jobs and opportunities when it becomes

operational; creates the “trickle down” effects of economic growth • “Cities digest poverty” and enable the achievement of self-actualization and self-fulfilment • Cities deliver development goals when they have sufficient and appropriate leadership and capacities, devolution of functions,

and financial independence • The poor take longest to recover from damages to life and property and catastrophic healthcare costs, both of which are

intrinsically linked with the quality of their living conditions

• Cities lack the data and insights required to better plan and design their development pathways, policies and interventions • Governments at all levels in India are developing the courage and capacity to tackle ‘Big Hairy Audacious Goals’ • India is increasingly taking the lead in setting and following global agendas within a ‘rules-based international system’

“Theory of Change” and Log Frame for Sustainable Urbanization in India (contd)

GOAL

Leave No One Behind Ensure, to 260 million Indians living in poverty, sustained and affordable access to water supply, sanitation, public transport, safe and secure housing, clean environment, food, and markets that support enterprise


INPUTS/ NECESSARY CONDITIONS • Decentralisation of decision-making and devolution of powers to municipalities • Efficient land-titling systems • Commitment at all levels of government to creating the enabling conditions for sustainable growth: geography and space;

truly competitive markets; level playing fields; enabling policies, de-risked investments • Fiscal management at all levels of government accounts for the real costs of development, including collateral damages,

hidden subsidies, and co-benefits of allied investments • Sustained (10 years of) investment (capital expenditure) in cities/infra from public as well as private sources • Withdrawal of government from areas of the economy where private investments need to be ‘crowded-in’ • Maximum value capture of municipal assets such as location, heritage, tacit knowledge, networks • Effective enforcement and behaviour change to ensure payment of taxes and user charges • Cities planned at a regional scale as ‘systems of systems’ • Planning, technology and finance to deliver distributed networks for energy, water and sanitation, and integrated multi-modal

transportation • Containment strategies for cities to ensure holistic urban-rural development and sustainable scale


INPUTS/ NECESSARY CONDITIONS (contd) • National, state, local and global monitoring of outcomes is frequent/real-time and comprehensive • Governments receive sustained support from (local) communities, institutions, business & industry, for knowledge/evidence,

policy formulation and implementation • Sustained ‘policy contagion’ • Address the numerous blind-spots in urban/infra policy in India: such as agency (who decides who decides?); nature and

extent of informal economy; economic and ecological footprints of food supply chains; local developmental impacts of inward remittances


OUTCOMES/ IMPACT

• All SDGs and targets achieved by 2030 • Poverty obviated and shared prosperity created • Effective models, systems and processes for inclusive, safe, resilient and sustainable urban life in India • All Indians achieve Human Development goals and move higher on Maslow’s “hierarchy of needs” • Balanced and green growth achieved through integrated urban-rural development

OUTPUTS/ RESULTS

• All cities have suitably empowered local governments with empowered leadership • All cities have enabling ecosystems that combine the ‘Quadruple Helix’ of essential stakeholders • All cities have sufficient and rigorously managed data systems • All cities have resilience plans, GHG maps and other information systems that support decision-making • All cities have accurate mappings of their resource base, consumption footprint, costs and revenue bases • All cities follow participatory and consultative development processes • All cities create positions for CTOs, CIOs, CROs, CBTOs


ASSUMPTIONS/RISKS

• Behaviours of all actors do not change to orient towards sustainability • Jobless growth due to Industry 4.0, outsourcing to cheaper markets, slowdown of domestic consumption • Policies do not get translated into actions because of federal imbalances and • Growth is not evenly distributed due to regional disparities and weak political economy contexts in many states, spurring

further distress migration and creating more “hollow villages” • ‘Crony capitalism’ infiltrates government, promoting profit motives that entrench inequities • Planning and design inputs remain inadequate and poor quality — do not create decoupling, value for money, sustainability,

resilience • Actions are delayed due to funds and capacity constraints– infrastructure built without resilience to shocks and strains • Adaptations in technology and appropriate environmental and social safeguards are not put in place fast enough to prevent

the massive consumption of natural resources and energy: the most harmful externalities of massive infrastructure development

THANKS

[email protected]

making urban india sustainable: framing a theory of …making urban india sustainable: framing a...

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