Projects worth more than Rs 2.04 lakh crore were sanctioned for the Smart Cities Mission of the Narendra Modi government ever since the project was announced for four years ago. These were for 91 of the 100 demarcated Smart Cities coming up.
“The concept of smart cities is not simply about integrating technology into urban infrastructure, but about improving the overall quality of life of citizens residing in the country," said Durga Shanker Mishra, secretary, ministry of housing and urban affairs.
"The (Smart City) Mission aims to undertake a complete urban transformation to meet the demands of more than 50 per cent of the population which is expected to reside in cities by 2050," said Mishra, speaking at 4th Smart Cities India 2018 expo in the national capital.
According to Mishra, contrary to public perception, the work on Smart Cities has picked up pace and has now entered Phase-2 of the mission. "Since the launch of the Smart Cities Mission, we have flagged off projects worth Rs 2.04 lakh crore towards developing urban infrastructure and living spaces for more than 90 cities that have been selected for the mission,” he said.
The government had earlier identified 100 cities to be developed under Smart Cities Mission. Each city would be a corporate entity with a full-time CEO. The Centre and states together are supposed to raise Rs 1,000 crore funding for this public-private-project joint venture. The remaining amount is supposed to be arranged by the developer company throughout rights issues and other sources.
The mission had faced criticism over the fact that progress of it was slow and developers are allowed a certain leniency by the ministry of housing and urban affairs.
According to Mishra, the Special Purpose Vehicles which are supposed to run the companies developing Smart Cities, and appointment of developers have been done for nearly 80 per cent of all the 100 demarcated cities.
Most states, other than West Bengal, have nominated a location for having a Smart City in the state in earlier polls conducted through social media by the government.
The rollout of Smart City projects have driven huge business interest among local investors and foreign EPC consultancy and IT firms. Developers of renewable energy technology and Smart Cities from countries like Germany, France, Japan, Switzerland among others, are seeking business opportunities from the Indian Smart City Mission.
"Developers must not look at acquiring only technology. Rather they should look at things from the perspective of a service provider and urban planner," advised Tanmay Chakraborty, group head, government affairs, Tata Sons, to CEOs of Smart Cities attending the conclave.
On the revenue side, Smart City developers were advised to look at increasing property tax rates as a means for raising the requisite capital for their smart city projects. "The aim should be to be able to increase the property tax rates, even though that may not entirely cover all the costs," said Bhupesh Rathore, head strategic government advisory, YES Bank.
Rathore said Smart Cities would be able to provide better quality of life and better economy in all aspects of a citizen's life and hence a higher property tax rate is justified, as developers of Smart Cities are after all service providers.