FE Editorial : The road not taken

Written by The Financial Express | Updated: Aug 20 2012, 09:18am hrs
Imagine the number of approvals needed for a road project to begin. Now multiply that number by three (central, state and municipal). That is the scale of complexity that each urban project runs up against in India. This is the reason why, seven years after it was launched, the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) has so few successes to show (of the total central budget of R42,257 crore, 61% has been spent till March 2012, excluding the special bus purchase projects). This does not mean there have been no isolated successful projects in urban India. But few of them owe their success to the largest urban renewal mission plan that was conceived for 66 of Indias largest cities. As the Planning Commissions review of the scheme shows, the biggest obstacle to its success is the lack of ability among town administrations to develop an interconnected set of projects for cities. Those sent up for approval have to be re-jigged thoroughly on technical and financial issues. This means even before more money can be poured into JNNURM, the capabilities of the municipal cadre have to be improved enormously. This is true, as neither the state governments nor the Centre have any better understanding of the needs of cities, at present. The two ministries of urban development and urban housing were split from the original urban affairs to accommodate more ministers rather than as a thought-through plan. As a result, JNNURM too has the rare distinction of being run by two ministries instead of, say, MGNREGA, which is administered by the ministry of rural development. The signalling that this creates for the states and the cities below them is then easy to grasp.

A McKinsey report on Indian cities points out the scale of the operations that our cities need. By 2030, 590 million of Indias population will inhabit urban areasmore than twice the number of our current city dwellers. The level of investment required is over $1.2 trillion, but the current method of project approval is a licence for a vast scale of corruption, as none of the entities have the capacity to monitor the spending to audit the usefulness of the outcome. The Plan panel wants to cut down the financial size of the outlay to invest in capacity-building of the towns for the next five years. This is surely going to be a painful process, but the alternative, of throwing money at the problem, is far more disturbing.