Prime Minister Narendra Modi recently kickstarted the execution of Smart City Plans of 20 cities in Pune, as the city was first off the block with projects. So Pune is being seen as a lighthouse for cities across the country for urban renaissance. Kunal Kumar, commissioner of the Pune Municipal Corporation & director of Pune Smart City Development Corporation, is spearheading the transformational projects in the Aundh-Baner-Balewadi area and across the city. He tells Geeta Nair that the city is looking to tap bond markets, monetise land, and use the PPP route to fund the projects.
Q1. What is the progress of implementation of the 14 projects launched in June by the Prime Minister in Pune. Which of these have gained traction and will be visible on the ground soon?
A: The projects launched by the Honourable Prime Minister are being driven on a war footing.
To highlight a few areas of progress, we have already commissioned the Transportation Command and Control Centre and launched the Mobility Integration Card, India’s first “Interoperable Smart Card” which is designed to be a single payment card for various transport modes across the city. Around 1,750 busses have been fitted with a GPS tracking system. All of this will be integrated through a world class app to put the entire PMPML bus network information at your fingertips. We have also piloted a Vehicle Health Monitoring System on 30 busses. To support all of these transportation initiatives, we are adding 1550 new busses to the fleet – this will significantly improve availability and reduce the average life of vehicles across the fleet. Another important project is the street and pedestrian walkway in Aundh. We have conducted an extensive citizen engagement effort for the design, and have now completed detailed designs and appointed a contractor. Construction will begin very shortly.
Q 2: What is the total investment expected in the Aundh–Baner–Balewadi (ABB) area under this programme? What will be the first tranche of investments and when will the expected flow of funds from the centre and state start?
A: The total investment in Aundh-Baner-Balewadi (ABB) area under the Smart City Program (SCP) will be about Rs 2,000 crore over the next five years. This investment will fully transform liveability across all dimensions so that it is in line with best-in-class global cities. The transformation will be able to support a fourfold growth in population (from 40,000 to 1,50,000) by 2030.
Most of this investment will be in 5 focus areas – mobility, 24/7 water, open areas regeneration, employment and citizen services. Mobility needs of the area will be addressed through 100 e-buses, 8 km of BRT, overhaul of 54 bus stops, 100 e-rickshaws, 42 km of bicycle tracks and 60 km of footpath redesign. 7 reservoirs, 50 km of pipelines, recycling and 100% coverage of smart meters are among the important initiatives to ensure 24/7 water availability. The area’s open spaces will be revamped through development of the Mula riverfront and 13 parks. Additional office spaces including a pioneering Start-up Hub have been planned to accelerate growth of employment opportunities in the ABB area. Finally Citizen Services will be transformed through a suite of virtual and physical interventions such as a Single Window Desk, an Integrated Citizen Desk and the ABB Punetel Card.
One of our areas of focus for the initial tranche is re-design of streets, which is in an advanced stage. Public participation has helped us to identify 1.5 km of streets which we are in the process of revamping. We have also completed a feasibility study to increase water availability in the city, with two out of three packages already under tendering. In addition, we have received support from the UK government to create a master plan of the ABB area which includes the development of a world class transit hub.
Q 3: Would you raise funds through Municipal Bonds/ Infrastructure Funds this year from the market? Will you capitalize on PMC’s strong balance sheet and good ratings? If not this year, how much would you raise later and by when? Would you consider raising funds from any other global funding agencies?
A: We have an ambitious capital expenditure program of over Rs 31,000 Crore in the next five years. While our strong financial position – as evidenced by a AA rating from Fitch – gives us a great staring point, we will need to be innovative to meet our financing requirements.
We will certainly look to tap the bond market for funds but given the appetite for municipal bonds, this will account for only a part of our funding needs. To expand our portfolio of options, we are looking at several alternatives including Public Private Partnerships which will account for about Rs 10,500 crores of the total capex and over Rs 8,000 Crore from various central and state government schemes
Loans from multilateral and bilateral funding agencies is another major thrust area. JICA is already funding our National River Conservation Project. We are also working with various funding agencies for the funding of the 24/7 water project. The project has approved by the Department of Economic Affairs, Government of India and we are in advanced discussions with agencies like HUDCO and IIFCL for funding the project.
In addition to tapping into new financing sources, it is also important – for long term sustainability – to expand the PMC’s revenue base. Initiatives on this front include CSR budgets and a slew of “win-win” revenue enhancing measures proposed in the Draft Development Control and Promotion Regulations, 2015.
Q 4: A significant portion of the resources you have to raise on your own are to be raised by monetizing land. Have you started work on the first of this deals for the current and are there takers for these land parcels at the valuations you have fixed? What is the target for the first year?
A: Many cities across the world have realized the importance of land monetization as a tool for municipal financing. A case in point is MMRDA’s land monetization programme in the Bandra Kurla Complex to part fund its development plan. Monetization through Transit Oriented Developed has also been successfully leveraged by Hyderabad to develop the metro project on a PPP basis. We have already started conducting feasibility studies for a few land parcels to estimate their monetization potential. We will also develop an optimal mechanism for monetization after evaluating various partnership and development models for the identified land parcels. For example, in the ABB area alone, we expect to generate more than Rs 1,000 crore through land monetization. In addition, we are evaluating a PPP cum monetization model for the High Capacity Mass Transit Route (HCMTR) project.
Q.5: How many of the MoUs that have been signed with companies and institutions have progressed to the next level? Which are these and with whom?
A: We are tying up with various government, trade bodies and science and research organizations to bring the best available knowledge to Pune. To this end MOUs have been signed with the Government of Britain, the US Treasury, ISRO and the UN Global Compact. We are also in advanced stages of signing MoUs with a few other Governments and trade bodies such as the European Business and Technology Centre (EBTC). I am also proud to share that Pune has been selected as one of the 100 Resilient cities of the world, a program pioneered by the Rockefeller Foundation. We will soon start working with the Foundation to insulate Pune from the physical, social and economic pressures of the 21st century.
Q. 6: There has been resistance from elected representatives at various times. Are their grievances genuine or is it resistance to implementation of a new idea of governance or a reaction to well entrenched interests getting challenged. Could this come in the way of implementation?
A: In a democratic set-up everyone is entitled to their opinions and discussions and disagreements are part of a democratic process.I am happy that various members feel strongly about the issues that impact Pune and are constructively engaged in contributing ideas to help to improve the city. It is these discussions which have strengthened the overall Smart City Program. In fact, the Smart City initiative enjoys support from almost all major political parties.
Q. 7: Despite all your citizen engagement initiatives on-line as well as off-line why is there a persistent criticism of lack of genuine citizen involvement and perception that this is a top down approach?
A: The first phase was immensely successful in engaging citizens. The program was broadly based on the mandate of the city in which the entire administrative machinery help from the media and NGOs reached out to over 50% of Pune’s households through both on-line and offline channels. Having said that, I firmly believe that citizen engagement in a continuous journey. As we move forward towards implementing Smart City projects and initiatives, you will see us spending even more time engaging with the citizens, getting their inputs during the execution stage and obtaining feedback to the changes we are implementing. Seeing is believing—I am confident that as people see these initiatives coming alive and Pune turning smart(er), they will embrace the work we are putting in.
Q.8: While ABB is a better developed area of the city and there is ease of implementation here, can this be a yardstick for replicating in rest of the city and impacts larger number of people and greater part of the city?
A: Yes of course. Our fundamental design principle for Local Area Development was scalability. Every idea we apply in the ABB area is reviewed with the objective of scaling it to the entire city. For example, the 24×7 water initiative has already been designed so that the whole city has adequate water. Similarly, initiatives like pedestrian-friendly streets, place-making and regenerating open spaces will be piloted in ABB but are proposed to be rapidly rolled out across all parts of Pune.