India Banao!

In his recent Budget speech, the finance minister reiterated the government’s plans to make India “slum-free” within five years. This mantra is now being chanted in many urban-related conferences. However, this raises a number of questions. What does a “slum-free” India really mean? Is the removal of slums really desirable? Most importantly, what needs to be done to improve the lives of the millions of urban poor? In this article, I will argue that public policy should focus less on getting rid of slums and more on rethinking property rights, especially those of the poor.

The flow of urban poor
The conventional view for making our cities slum-free is that we should build low-cost housing and shift the existing slum-dwellers into them. There is a serious flaw in this solution because the urban poor are not a static group but a flow.

In the last two years, I have travelled across many parts of rural India. The message is very clear. The children of farmers no longer want to stay on in their farms. No government scheme is going to hold back the change in aspirations. The country’s cities need to prepare for the influx. In an earlier column, I had argued that slums play an important role in the phase of rapid urbanisation by absorbing and naturalising the new migrants into the urban landscape (see Slums defy a concrete answer in Business Standard, December 9, 2009). As hundreds of millions of people are absorbed into urban India, slums and small mofussil towns will be needed as routers in this process. If we simply get rid of today’s slums, we will merely get new ones.

The point is that we should concentrate on alleviating urban poverty rather than getting rid of slums. The former is the problem and the latter is merely the symptom. Peruvian economist Hernando de Soto has been arguing for years that the solution lies in strengthening the property rights of the poor. This is usually interpreted as formalisation of squatter rights. This may make sense in Latin America, which has a relatively stable population of urban poor and whose economy is growing slowly. However, this is too narrow an interpretation for a high-growth economy like India where booming urban centres are sucking in millions of new migrants.

The first problem with recognising squatter rights is that we create problems of governance by potentially encouraging land-grab. We not only have to think about today’s urban poor, but also about the incentive structure presented to the next generation of migrants. Second, the formalisation is usually done on the basis of a cut-off date. This often recognises the rights of better-off old-timers against those of poorer newcomers. Finally, and most importantly, in next generation cities like Gurgaon, the poor live in the “urban villages” where property rights are very clearly defined and any tampering would cause serious social upheaval. So, what should we do?

Beyond merely ownership
In my view, we need to rethink the property rights of the urban poor as being much more than the ownership of real estate. This is especially true when we have a pipeline of migrants who do not have any existing claim on the city’s land. Therefore, alleviation of urban poverty must focus on those property rights that will benefit these migrants and allow them to climb the economic ladder. There are three broad categories of such interventions:

Identity as a property right: The single-most important, and sometimes only, asset of a poor migrant is her identity. Without any form of identification, it is very difficult for a newcomer to fit into the urban landscape — no gas connection, no mobile phone, no voter rights, no credit and so on. It is nearly impossible for such an individual to apply for jobs in the formal economy or sometimes even as domestic help. Thus, a reliable and robust system of identification is invaluable. This is why Nandan Nilekeni’s Unique Identity Number scheme may turn out to be a major intervention.

Access to the ‘commons’: The urban poor rely heavily on the “commons” to lead their lives. Therefore, much of their property rights relate to access to public amenities rather than to private space. These include access to public transport, public toilets, public health, parks/open spaces, pedestrian networks and so on. These user rights are far more important to the poor than merely providing a “housing” solution for the individual. Urban design and public investment needs to be reoriented to focus on the commons.

Legal infrastructure: All rights, including property rights, exist only within a legal framework. Urban laws and their application need to be oriented towards protecting the legitimate needs of the urban poor, especially in areas related to livelihood. For instance, street hawkers need to be recognised and incorporated into the legal and architectural framework of the city. Rather than see hawkers merely as a nuisance, we should see them as part of the ecosystem of a vibrant city. What they need is transparent regulation not banishment. The current approach taken by most municipal authorities is merely leading to the proliferation of illegal hawkers and to corruption.

If these frameworks are put in place, the urban poor will themselves find ways to move up the value chain. Indeed, the slums themselves will evolve and upgrade (as is happening anyway in many of the older urban villages of Delhi).

To conclude, we need to strengthen property rights that can be leveraged by the pipeline of future migrants. In Latin America, it may make sense to interpret property rights as mostly relating to land titles and squatter rights. The population of urban poor in Latin America is relatively static — the countries are already fairy urbanised and their economies are growing slowly. In India, the throbbing economy is sucking millions of new migrants. We need to think of property rights in ways that allow these new migrants to enter and climb the system.

This article has been published in Business Standard on March 10,2010.

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The city must now choose between two very different futures

To whom does Mumbai belong? This is a question that has simmered for years and has now blown up into a major national controversy. For Mumbai, it is a question that is fundamental to its very existence as India’s pre-eminent financial, commercial and cultural hub. At a time that India is re-emerging as a major player on the world stage, its response to the above question will decide whether Mumbai will run with Singapore, New York and London or will languish as tomorrow’s Kolkata. The slope is slippery.

The age of global cities
The world is not flat as Thomas Friedman would have us believe. It is spiky, with large concentrations of population and economic activity clustered around a network of cities. These cities act as inter-connected nodes in the social, economic and cultural network that characterises the post-globalisation world. At the pinnacle of the hierarchy of cities are a handful of “Global Cities”. These hubs have become so important that the 21st century will probably be known as the “Age of Global Cities”. Indeed, it can be argued that London is today more important as a centre of finance and commerce than it was during the height of British Empire.

Most leading global cities of today are in the West — most notably London and New York, but also smaller hubs like San Francisco, Boston and Paris. However, there are now centres like Singapore and Hong Kong in Asia, as well as new competitors like Shanghai. A country derives enormous economic advantages (not to mention cultural influence and soft-power) from being host to a global city. As an aspiring world power, India needs its own global city.

What makes a successful global city?
In recent years, researchers have studied the phenomenon of global cities and have tried to explain their success. Each city has its special advantages — good universities, location, historical links, institutions and so on. However, a common theme is their openness to new ideas, external cultural influences and “outsiders”. Imagine New York without the waves of immigrants – Irish, Italian, Jews and, more recently, Asians and Latin Americans. Similarly, consider the relative trajectories of Tokyo and Singapore.

Till the early 90s, Tokyo was the most important urban hub in Asia. It was miles ahead of Hong Kong and Singapore. Yet, Tokyo is today merely a large Japanese city that has little influence on the rest of Asia. We cannot just blame this on Japan’s economic decline. After all, London has survived Britain’s decline to remain the world’s premier financial hub.

In contrast to Tokyo, tiny Singapore has self-consciously attracted foreign talent, invested in culture and created international linkages. The results are plainly visible. Singapore is not just one of the world’s largest ports, it is a formidable centre for banking/finance, education and even medical treatment. Once considered too straight-laced, it now enjoys the most vibrant night-life in Asia (sorry Hong Kong). More than 10 million foreign tourists visit it every year — double the number received by India, a country with 250 times the city-state’s population.

The decline of Kolkata tells the same story. Till the mid-60s, the city was the most important cultural, intellectual and commercial centre in India. Its industrial hinterland was the largest in Asia, excluding Japan. The city was a multi-cultural mix of Bengalis, Marwaris, Biharis, Anglo-Indians, Europeans, Jews and Armenians. It even had a vibrant China-town. However, attitudes changed from the 60s — multinationals were squeezed out, new technologies were discouraged and the teaching of English was banned. Even the works of Rabindranath Tagore could only be performed according to strictly-prescribed formulae. The result was not a renaissance of Bengali culture. Instead, Bengal has never again produced individuals of the caliber of Tagore, Satyajit Ray, Vidyasagar, Vivekanand or Subhash Bose.

The lessons of Kolkata are important for Mumbai, especially since its own rise was partly helped by its rival’s decline in the 60s. Many of the companies that drive Mumbai’s current success were originally headquartered in Kolkata, and, in some cases, are still registered there. The self-proclaimed protectors of the Marathi Manoos may want to consider what happened to the Bengali Bhadralok. Today, the Bengali middle class (including me) lives in “exile” in Bangalore, Delhi-Gurgaon, New York, London and even Mumbai. We were not exiled by foreign rule or by the invasion of migrants but by close-mindedness and the lack of imagination.

Our heavy-weight champion
Two generations after it lost its empire, London allows Britain to have a disproportionate influence on international matters. China already has two serious financial centres in Hong Kong and Shanghai. Its capital Beijing has been an Olympic host. If India wants to play on the world stage, it needs at least one heavy-weight global city that can be a financial and cultural nerve centre. Mumbai is the obvious candidate with its combination of financial muscle and Bollywood. With just 1.6 per cent of the country’s population, the city dominates India’s economic and cultural life.

Mumbai’s future is part of national strategy and we cannot allow local politics to derail it.

Nonetheless, we should recognise that legitimate local aspirations need to be accommodated. This is not just an issue for Mumbai. We are entering and era of rapid urbanisation that will see 350 million people absorbed into urban India in the next three decades. Frictions between locals and migrants will soon arise in Bangalore and Gurgaon, and eventually even in Lucknow and Patna. We need to create mechanisms that help the “locals” compete in the rapidly-changing urban environment (for instance, by investing in vocational training), while at the same time making it clear that street violence will not be tolerated.

I hope that Mumbai will eventually make the right choice. If not, the mega-city of Delhi-Noida-Gurgaon will have to take on the burden of becoming India’s heavy-weight champion. Perhaps, Kolkata will grab the opportunity to make a comeback!

This article has been published in Business Standard on February 2010

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We need a ’strong’ but ‘limited’ state

It is now 60 years since we became a Republic and the Indian state came into being. Yet, each passing day brings fresh evidence of the state’s inability to respond to threats to its citizens: witness the daily Naxalite attacks in eastern India, jehadi terror from Mumbai to Kashmir, the “parole” for Manu Sharma, the rampant poaching of tigers, and our apologetic response to Chinese pressure on Arunachal. These are not mundane failures in the provision of public services but go to the heart of what we should expect of the Indian state.

Back to basics

We tend to expect a lot of things from the state — from defence of our borders to clearance of garbage. We also expect it to actively promote economic “development” and a myriad of social objectives. Therefore, we have given the state very wide-ranging powers. However, the Indian state is clearly unable to deliver on most of these expectations. Instead, we have ended up with a weak but all-pervasive state that does not have a clear set of priorities. Since it does not have a clear set of priorities, we cannot judge its performance and hold it accountable. What is worse is that unscrupulous individuals have been able to subvert the powers of the state to serve their own ends.

The first thing we need to do is to decide what is the most important role of the state. Robert Nozick, one of the 20th century’s most influential political philosophers, was of the opinion that the first responsibility of the state is to protect its citizens against violence, theft and fraud as well as to enforce contracts. Indeed, Max Weber defined the state as the apparatus that has the monopoly over the use of force in a given territory. A state that cannot enforce this monopoly is not a state at all.

This echoes the traditional Indian notion of the state. According to Kautilya’s Arthashastra, the maintenance of law and order and the dispensation of justice is the science of government. Similarly, as Gurcharan Das has argued in his latest book, the one thing that the Kurukshetra War teaches is that there will always be individuals like Duryodhana and society needs to curb them with force, if necessary. Being “good”, like Yudhishthir, is not the state’s first mandate.

Contrast this with the bewildering responsibilities that we have burdened the modern Indian state with. I am not arguing that the government should abandon all other responsibilities but merely pointing out that the maintenance of order and dispensation of justice (including enforcement of contacts and the protection of property rights) must be the starting point. Today’s Indian state fails miserably at this basic responsibility — witness the moribund legal system, and the usurpation of power by non-state actors like the Naxalites.

In short, I am arguing that the Indian state must be “strong” and it must restore its monopoly over the use of force. This includes the urgent reform of the police, legal system and the administrative apparatus. This is far more important for the country’s economic and social future than spending on various government “development” schemes. As Arthashastra puts it, “Progress in this world depends on governance and on the maintenance of order.”

A strong state is not without its own dangers as there is always a risk that it may become totalitarian (we experienced this ourselves during the Emergency). This is why other democracies have put serious limits on the powers of the state. The need to limit the powers of the monarch (i.e., the state) has been an important aspect of the development of British democracy since the Magna Carta. The Magna Carta Libertatum, signed in 1215 AD, literally means “The Great Charter of Freedoms”. Similarly, the Tenth Amendment of the US Constitution ensures that powers that have not been explicitly granted to the federal government will continue to reside with the people.

India took many things from the British and American constitutions but there is a general assumption that the rights of the people need not be defended against a benign state. Thus, the “benign” state is allowed to interfere with all aspects of the nation’s life and individuals are expected to fall in line for the greater good. The most obvious manifestation of this phenomenon was the attempt to accelerate economic development through socialist planning and industrial licensing. However, this attitude is evident in all aspects of public policy. Till 2001, the citizens of India were not officially allowed to unfurl the national flag — even this was the prerogative of the state. Although industrial licensing was abolished after the crisis of 1991, the overall statist framework remains in place. This provides ample scope for corruption and misuse. Virtually no Indian trusts the country’s politicians and civil servants. Why then do we give them so many powers that are not essential to general governance?

The ‘strong’ but ‘limited’ state

The limited state should focus on two broad areas. First, it should focus on framework issues like defence, internal security, policing, justice, foreign policy, monetary policy, financial regulation and so on. Second, it should provide for public goods where market-solutions will clearly not work — environmental protection, public health, and so on. The Indian state should be encouraged to make sure that it does a good job of these before it attempts anything else.

There is often a presumption that a limited state that focuses on institutions of governance is somehow less concerned about the welfare of the common citizen than the interventionist state. In turn, this flows from a belief that the enforcement of contracts and property rights mainly benefits the rich. Nothing can be further from reality. The rich and powerful will always find ways to protect their interests (as Manu Sharma’s “parole” clearly demonstrates). The properly functioning legal framework is mainly in the interest of the poor. This is not a new thought. In Arthashastra, Kautilya points that the failure to provide justice leads to Matsanyaya — the law of the fish where the big fish swallow the small.

Kautiya’s vision has a great deal of relevance even today. For instance, take the Naxalite insurrection in eastern India. Conventional wisdom is that this is due to the lack of jobs and the so-called “development”. In reality, it is about property rights and the exploitation of the region’s natural resources with the active connivance of the state. In Nandigram, the local people were not asking for jobs and government schemes. They merely did not want to sell their land to a government that was arbitrarily using its powers of eminent domain. As can be seen, the solution for India’s current problems does not lie in the welfare schemes of a weak and all-pervasive state. It lies in a state that jealously guards its monopoly over the use of force in its territory but at the same time, is limited in how it can intervene in the lives of its citizens.

The article has been published in January issue of Business Standard

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There is every sign that India is launching into a period of rapid urbanization. In the next thirty years, an additional 350 million people will have to be accommodated in our existing towns as well as in brand new urban spaces. Given our inability to cater for even the existing urban population, there are serious concerns about out ability to deal with the influx. Are we entering a world of endless slums? The government has a plan to make India slum-free by 2015. Is this really good for the urban poor?

Rethinking slums as “Routers”
Economists and policy-makers like to use terms like “development”. However, at its heart, development really means the shifting of people from subsistence farming to other forms of livelihood. Urbanization is the spatial mirror of this process. This is why virtually every developed country is urbanized. We can clearly see that a combination of changing job opportunities, aspirations and lifestyles is driving India’s rural youth to flock to urban centers. The problem is to match hundreds of millions of migrants to jobs, housing, and amenities while maintaining overall social cohesion. Slotting so many individuals into the urban fabric according to his/her skills and financial abilities is a colossal task.
China used draconian social control systems to manage the process over the last two decades. In most other countries, slums played this role. Even in China, “urban villages” have been an integral part of the migration process.
Most people tend to be overwhelmed by the poor living conditions that prevail in Indian slums. The usual reaction is to treat this as a housing problem. Over the decades, we have seen many well-meaning slum re-development projects that have attempted to resettle slum dwellers into concrete housing blocks (often at the outskirts of the city) and to given them non-marketable property rights to their new homes. Yet, almost all of these efforts have failed to rid our cities of slums. More often than not, the former slum dwellers either sell , rent-out or abandon the new housing blocks and move back into a slum.
The problem is that these schemes take a static view of slums whereas slums are really evolving eco-systems that include informal jobs inside the slum, access on employment outside the slum, social networks, ease of entry, security and so on. Thus, slums play an important role as “routers” in the urbanization process. They absorb poor migrants from the rural hinterland and naturalize them into the urban landscape. In doing so, they provide the urban economy with the armies of blue-collar workers – maids, drivers, factory-workers etc. - that are essential for the functioning of any vibrant city. Urban master-plans simply ignore this dynamic process and consequently are unable to deal with it.

Why are Indian slums “safe”?
Slums are not unique to India. Virtually every country has faced this problem in some form during its period of rapid development. The slums of New York and London were legendry in the nineteenth and early twentieth century. However, we need to distinguish between urban decay and slums. Urban decay describes the condition of blight, hopelessness and abandonment that one sees in New Jersey, northern England or even in parts of Africa and Latin America. As writers like Jeb Brugmann have pointed out, Indian slums are not places of hopelessness but of enterprise and energy. Whether it is Mumbai’s Dharavi or Delhi’s “lal-dora” villages, most Indian slums have a surprising variety of commercial activity including shops, food vendors, garages and mini-factories.
Indeed, slums like Dharavi are remarkable in how safe and cohesive they are. Most readers of this article will be able to walk through the average Indian slum even at night without fear of being harmed. This is more than one can ask of down-town Johannesburg or Camden, New Jersey. Contrary to popular wisdom, inequality of income and wealth appears to have little impact in crime and social envy. Mumbai has many social schisms: Hindus versus Muslims, Marathi-speakers versus Hindi-speakers and so on. However, the city suffers little conflict between the rich and the poor despite having the most extreme differences in wealth and income.
This cohesion comes from the fact that migrants do not view slum-life as a static state of deprivation but as a foot-hold into the modern, urban economy. Life may be hard but, in a rapidly growing economy, there is enough socio-economic mobility to give most slum-dwellers hope and to keep them hard-working, enterprising and law-abiding. This is being recognized even in China where leading intellectual Prof. Qin Hui recently published a paper arguing that China needed more slums!
What should we do about slums?
I am not arguing that slums do not need help. Clearly, we need to provide the urban poor with better sanitation, public health, education and so on. However, we need to re-think the framework of our interventions:
First, advocates of slum re-development should recognize that they are not just dealing with a housing problem but are tampering with a complex eco-system. Thus, plans need to allow for informal commercial activities, pubic transport, and so on. To the extent possible, the re-development projects should be phased in a way that the eco-systems are not killed in the name of progress.
Second, we need to understand that slums are about ease of entry, upward mobility and churn. This process should not be disturbed by indiscriminately handing out non-marketable property rights. Instead, public intervention should encourage a market for rental accommodation starting from basic dormitories. However, when it is deemed appropriate to give property titles to slum-dwellers, the rights should be marketable.
Finally, and very importantly, we should not expect slums in the largest cities to act as routers for all the hundreds of millions of migrants. This is why we need to think of the small moufassil towns as mini-routers for the regional job markets. As I have argued in an earlier column (“Small Town India holds the Key”, Business Standard, 11th June, 2009) we need to revive small towns as social and economic hubs.

This has been appeared in Business Standard on 9th Dec 2009.
(The author is President, Sustainable Planet Institute & Sr. Fellow, WWF)

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Why a “strong” but “limited” State is the cure for problems ranging from Naxalism to Manu Sharma

Think about all the newspaper headlines you have read in the last few months. You will remember Naxalite attacks in eastern India, the “parole” for Manu Sharma, the Madhu Koda corruption allegations, the poaching of the last remaining tigers and rhinos, and our lukewarm response to Chinese pressure over Arunachal. What do all of these have in common?

They are all about the failure of the Indian State. It is now time to rethink the nature of the Indian State, its role in society, its powers and its obligations. In short, this is about renegotiating the social contract. This may need some Constitutional changes but mostly this is about what we expect from those who run the country in our name. Therefore, let us go back to first principles.

What is the State?

At a very fundamental level, according to Max Weber, the State is the apparatus that has the monopoly of the use of force in a given territory. A charity may do a great deal of work for the welfare of a population but it cannot be called a State because it does not enjoy the monopoly over the use of force.

In modern India, the State is made up of a number of different institutions. The most obvious are the legislature, the judiciary and the executive (or government). However, there are a number of other quasi-independent institutions are also an important part of the State – for instance the Election Commission. All of these institutions are symbolically unified in institution of the Presidency.

What is the role of the State?

We tend to expect a lot of things from the State – from defense of our borders to the clearance of garbage. We also expect it to actively promote economic “development” and a myriad of social objectives. Therefore, we have given the State a very wide-range of powers. However, given its limited resources, the Indian State is unable to deliver on most of these expectations. Instead, we have ended up with a weak but all-pervasive State that does not have a clear set of priorities. Since it does not have a clear set of priorities, we cannot judge performance and hold it accountable.

What is worse is that unscrupulous individuals have been able to subvert the powers of the State to serve their own ends. This is why other democracies have put serious limits on the powers of the State. The need to limit the powers of the monarch (i.e. the State) has been an important aspect of the development of British democracy since the Magna Carta. The Magna Carta Libertatum, signed in 1215 AD, literally means “The Great Charter of Freedoms”. Similarly, the Tenth Amendment of the US Constitution ensures that powers that have not been explicitly granted to the government will continue to reside with the people. Contrast this with the attitude of totalitarian regimes like Cuba, North Korea. Saudi Arabia or the erstwhile USSR.

India took many things from the British and American constitutions but there is a general assumption that the rights of the people need not be defended against a benign State. Thus, the benign State is allowed to interfere with all aspects of the nation’s life and individuals are expected to fall in line for the greater good. The most obvious manifestation of this phenomenon was the attempt to accelerate economic development through socialist planning and industrial licensing. However, this attitude is evident in all aspects of public policy. Till 2001, the citizens of India were not officially allowed to unfurl the national flag – even this was the prerogative of the State.

Although industrial licensing was abolished after the Crisis of 1991, the overall Statist framework remains in place. This provides ample scope for corruption and misuse. Virtually no Indian trusts the country’s politicians and civil servants. Why then do we give them so many powers? What we need is a State with limited powers and a focused set of priorities against which its performance can be judged.

Back to Basics

The first thing we need to do is to decide what is the most important role of the State. Robert Nozick, one of the 20th century’s most influential political philosophers, was of the opinion that the first responsibility of the State is to protect its citizens against violence, theft and fraud as well as to enforce contracts. This echoes the traditional Indian notions of the State. According to Kautilya’s Arthashastra, the maintenance of law and order and the dispensation of justice is the science of government.

Contrast this simplicity with the bewildering responsibilities that we have burdened the modern Indian State. I am not arguing that government should abandon all other responsibilities but merely pointing out that the maintenance of order and dispensation of justice (including enforcement of contacts and the protection of property rights) must be the starting point. Today’s Indian State fails miserably at this basic responsibility - witness the moribund legal system, and the usurpation of power by non-state actors like the Naxalites.

In short, I am arguing that the Indian State must be “strong” and restore its monopoly over the use of force. It should then reform the Judicial system and enforce contracts and property rights. This is far more important for the country’s economic and social future than spending on various government “development” schemes. As the Arthashastra puts it, “ Progress in this world depends on governance and on the maintenance of order”.

The “Strong” but “Limited” State

Given the above reasoning, the State should focus on two broad areas. First, the limited State should focus on framework issues like defense, internal security, policing, justice, foreign policy, monetary policy, financial regulation and so on. Second, it should provide for Public Goods where market-solutions will clearly not work – environmental protect, public health, and so on. The Indian State should be encouraged to make sure that it does a good job of these before it attempts anything else.

There is a presumption that a limited State that focuses on institutions of governance is somehow less concerned about the welfare of the common citizen than the all pervasive State that actively interferes with the country’s economic and social life. In turn, this flows from a belief that the enforcement of contracts and property rights mainly benefits the rich. Nothing can be further from reality. The rich and powerful will always find ways to protect their interests (as Manu Sharma’s “parole” clearly demonstrates). The properly functioning legal framework is mainly in the interest of the poor. This is not a new thought. In the Arthashastra, Kautilya points that the failure to provide justice leads to Matsanyaya – the law of the fish where the big fish swallow the small.

Kautilya’s vision has a great deal of relevance even today. For instance, take the Naxalite insurrection in eastern India. Conventional wisdom is that this due to the lack of jobs and so-called “development”. In reality, it is about property rights and the exploitation of the region’s natural resources with the active connivance of the State. In Nandigram, the local people were not asking for jobs and government schemes. They merely did not want to sell their land to a government that was arbitrarily using its powers of eminent domain.

As can be seen, the solution for India’s current problems does not lie in welfare schemes of a weak and all-pervasive State. It lies in a State that is strong in its ability to maintain monopoly over the use of force in its territory but at the same time is limited in how it can intervene in the lives of its citizens.

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Mumbai does not need to be “decongested”, it needs to redeploy its Eastern seaboard
Mumbai is by far India’s financial and commercial capital. Given the success of Bollywood, some would argue that it is also India’s cultural capital (sorry Kolkata). Yet, Mumbai is not a city for the faint-hearted with its ubiquitous slums, legendry traffic snarls and overcrowded trains. It already has a population of 19 million – most of it squeezed onto a small, narrow island – and continues to suck in people from across India. Not surprisingly, long-term thinking on Mumbai focuses on how to “de-congest” the city.
The idea of de-congesting Mumbai is not a new one. In the seventies, New Bombay (now renamed Navi Mumbai) was created on the mainland as a way to attract people away. From time to time we have heard political demands to limit the inflow of “outsiders” to the city. More recently, we have seen plans from large corporate houses to develop new satellite townships as Special Economic Zones. However, all these plans are ultimately flawed because they run the risk of de-clustering the very dynamic that drives Mumbai. In order to appreciate this, we need to understand why cities exist in the twenty-first century.
Why do cities exist today?
In the mid-nineties, many urban experts around the world were of the opinion that cities would become irrelevant in the post-internet era. After all, they argued, why would anyone pay high rents and suffer congestion in the city when they could use emails and mobile phones to work from anywhere. However, the last fifteen years have proved them wrong as cities across the world have prospered like never before. Notwithstanding the recent downturn, real estate prices have spiraled up and urbanization has sharply accelerated. A majority of the world’s population nowlives in urban centers and this ratio is likely to hit 70% by mid-century. Why?
First, it turns out that internet and mobile communications do not reduce the economic value of human concentration. Instead, they work as a force multiplier for urban density by encouraging creativity, intense social interaction and the exchange of ideas. Nowhere is this factor more economically valuable than in major financial and commercial hubs like New York, London, Singapore – and Mumbai.
Second, cities provide a clustering of hard and soft amenities like schools, hospitals, entertainment, shopping, social clubs, temples and so on. Modern lifestyles thrive on easy access to an array of these amenities but a workable concentration of them can only be provided in an urban setting. This is why internet and mobile phones are no threat to cities. If anything, they increase the aspirational demand for these amenities.
This has very important implications for how we think about Mumbai’s future. The conventional wisdom is that Mumbai is crowded and that we need to decongest it by creating new business districts and new satellite townships. We have already seen how the financial sector has spread out from the Nariman Point-Fort area to Bandra-Kurla, Lower Parel and even Andheri East. There are plans to build a new financial hub on the mainland. In my view, this is de-clustering the sector and eroding the intense human interactions that give the sector its vitality.
I have personally experienced the loss of efficiency. Till a few years ago, it was possible to do five or six business meetings a day in Mumbai. Now, it is barely possible to do one or two if one has to drive across the city. The point is that a financial or commercial center is no longer a hub if business interactions are totally depended on phones and email. After all, it is just as easy to call or send an email to Singapore or London as it is to send an email to Andheri East. Futhermore, it would take a very long time and a lot of effort for the new townships to create vibrant urban eco-systems. Notice how Navi Mumbai has still not been able to do this after four decades.
What should Mumbai do?
Mumbai clearly needs new offices, schools, hospitals, convention centers, apartments, parks, transport links and so on. As we have discussed, it is economically wasteful to build these away from the existing city. Readers may well ask : where is the space? Oddly, crowded Mumbai island has a lot space for expansion.
The single biggest area for expansion is Mumbai’s eastern seaboard, the so-called Port Trust land. This is a contiguous strip of 28km along the city’s eastern coast and has 1800 acres of derelict land that once operated as the city’s port. Other cities like New York and London have successfully redeveloped former port land, but the location of Mumbai’s former port is especially attractive because it runs parallel to the existing city (unlike London’s Canary Warf which is locatedon one side of the city). This offers two major advantages:
First, since it is a long contiguous strip, we can create a new public transport system running along the eastern coast with its own linkages to the international airport and the mainland. With a little foresight, the new buildings could be built in such a way that the new urban areas are integrated with the public transport system in order to maximize convenience and minimize land use.
Second, close geographical affinity would allow Mumbai’s existing urban eco-system to spill over into the newly developed areas. This means that there is far less risk of being stuck with the Navi Mumbai syndrome. Far from de-clustering the city’s financial/commercial hub, the eastern seaboard would give it space to grow organically.
The idea of redeveloping the port trust land has been circulating for several years now. However, there is a danger that it is ultimately chopped up into pieces and sold off to developers. This would merely perpetuate Mumbai’s current ills (as happened with the Parel mill lands). Those who care for Mumbai should demand that the eastern seaboard is developed in an integrated way so that the city gets new public spaces and amenities. My friend Suketu Mehta dubbed Mumbai as the “maximum city”. I think that there is scope for further maximization.
(The author is President, Sustainable Planet Institute & Sr. Fellow, WWF).

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At the beginning of the twentieth century, Calcutta (as it was known then) was the capital of the British Empire in India and its writ ran from the Khyber Pass to Burma. It was arguably the most advanced and cosmopolitan city in Asia. Its streets bustled with people from all over India and the world including Marwaris, Jews, Armenians, Europeans, and of course local Bengalis. It even had a vibrant Chinatown! It was home to Swami Vivekananda, Subhash Bose, Rabindranath Tagore to name a few of the Calcuttans who built modern India.
Even after the capital shifted to New Delhi and the shock of Partition, the city remained the cultural, intellectual and economic heart of India. In 1950, Calcutta’s metropolitan area had a population of 4.5 mn compared to Bombay’s 2.9mn and Delhi’s 1.4mn. Many of the country’s top companies were headquartered in the city and its industrial cluster was the largest in Asia outside of Japan. Yet, today’s Kolkata rarely merits a mention for its economic or even cultural achievements. In the late sixties, it ceded its position as India’s commercial capital to Mumbai and has made no effort to gain it back. It remains the country’s third largest metropolitan region after Mumbai and Delhi, but in terms of economic importance it lags behind Bangalore, Hyderabad, Chennai and perhaps even Pune and Ahmedabad. What went wrong? Can Kolkata’s spirit be re-ignited?
Software versus Hardware
Kolkata suffers from many of the same problems that plague other Indian cities ranging from traffic jams to slums. However, it would be difficult to argue that Kolkata’s physical infrastructure is especially bad. Water and power supply is far more erratic in Delhi, the traffic jams are far worse in Bangalore and the public transport system is far more crowded in Mumbai. Yet, Kolkata has lagged far behind all these cities. The reason is that Kolkata’s problems stem from its software rather than its hardware.
Urban software relates to social, economic, cultural and intellectual activities that animate a city and give it life. In particular, it relates to the clustering of human capital. Till the 1960s, Calcutta had the best clustering of human capital in India including industrial workers, corporate managers, artists and scholars. This human capital cluster unwound in the late sixties and seventies and completely disintegrated in the eighties.
This was the consequence of a cultural and political milieu that actively discouraged innovation and risk-taking of any kind. The impact of aggressive trade-unionism on Kolkata’s commercial sector in well known. Less well known is the impact of cultural close-mindedness on intellectual innovation. The teaching of English was stopped in government-run primary schools. Heterodox intellectuals like Nirad Chaudhury were actively persecuted. Institutions like Calcutta University were deemed elitist and either ignored or deliberately subverted. For half a century, there was a ban on any form of innovation in the way Tagore’s works were performed. His songs and plays had to be performed according to strict formulae. The result was that Kolkata went from being a cosmopolitan city to becoming a provincial town.
Not surprisingly, the city’s once proud middle-class (the “bhodrolok”) scattered all over India and the world. The city’s economic dynamism left with them. I know this from personal experience. Few of my childhood friends and classmates still live in the city. Kolkattans may be proud of Amartya Sen, Shashi Tharoor and Laxmi Mittal but these successful individuals left the city decades ago.
In recent years, the citizens and rulers of Kolkata have begun to recognize the need for change. As readers will know, the initial efforts at reviving the industrial sector have got tied down by disputes over land acquisition. However, the real issue is not the availability of industrial land or urban hardware. The real problem is that the city’s software needs to be upgraded and the human capital cluster needs to be rebuilt.
“Software” as strategic intervention
In my last Business Standard column (“Reinventing Delhi: Cutting the Gordian Knot”, 2nd September 2009), I had argued that urban re-engineering should rely less on master-plans and more on strategic interventions. Usually, these strategic investments relate to hardware such as the Delhi Metro. However, in Kolkata’s case the required strategic interventions involve investing in “software”.
Kolkata is still home to a disproportionately large number of cultural and intellectual institutions, many of them built during British rule. These include academic institutions like Calcutta University (and famous colleges like Presidency and St.Xavier’s), the Indian Statistical Institute and the Indian Institute of Management at Joka. Not far away are IIT-Kharagpur and Viswa Bharati, Shantiniketan. Kolkata is also home to the National Library, the Asiatic Society and to the Indian Musuem, Asia’s oldest museum. Kolkata still holds one of the world’s largest book fairs and possibly the most spectacular religious carnival – the Durga Puga (sorry Rio). It even has the world’s most extra-ordinary collection of colonial-era buildings including architectural treasures like the Victoria Memorial and Writer’s Building.
All of these are assets of enormous economic value. The future of Kolkata lies in unlocking this value. Unfortunately, virtually all of these assets have been allowed to decay for decades. The city’s government, its citizens and its well-wishers need to re-invest in them and revive Kolkata as a hub of cultural/intellectual innovation. This is not an elitist vision about high-culture but one that goes to the heart of what gives a great city its “buzz”. Cities like New York, London and even Mumbai are not just great commercial hubs but also important cultural and intellectual hubs. Their secret of success is the bubbling cauldron of ideas and influences (Raj Thackarey should learn to appreciate this).
To conclude, Kolkata’s revival needs investment in its software rather than in its hardware. We need to re-ignite the spirit that animated the city in the nineteenth and early twentieth centuries. This needs investment of money and effort in bringing back its cultural and intellectual institutions (and building a few new ones as well). In turn, this will build back the cluster of human capital that once drove the economy. And best of all, this strategy does not require large-scale land acquisitions!
(The author is President, Sustainable Planet Institute & Sr. Fellow, WWF)

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The Economic Times editorial of 27th September 2009 quoted the WWF’s The Alternative Urban Futures Report and raised the following question: “Is the WWF survey looking at walking as a recreational activity or as just another way of getting to work and back?” As principal author of the report, I would like to respond.
“Walkability” is about allowing the average citizen to lead his/her life in way that walking is an important, even dominant, mode of transport. Walking for recreation may be a part of this but walkability is about a whole new way of designing a city. Public transport, for instance, works only if the last mile can be walked. Similarly, creating the space for walking is a very important way to encourage social interaction and inclusion – after all both rich and poor can walk. In other words, walkability is not just about foot-paths and overpasses but about urban density, public transport, public spaces, social cohesion and urban “buzz”. Each one of these is an important ingredient for a vibrant city but walkability is a paradigm that encapsulates all of them.
Any discussion of public transport in India ends up being a debate about buses and trains. Oddly, the simplest and most widely used form of public transport in India is “walking” and its sister mode “cycling”. A 2008 study of 30 Indian cities by Wilbur Smith Associates showed that almost 40% of all trips in urban India involved no motorized vehicles at all – 28% walked and 11% cycled. The proportion was sharply higher in smaller towns since distances were usually small and the roads less congested. However, in bigger cities, the proportion of people using conventional public transport was high, and consequently commuters walked the last mile. For instance, in cities with more than 8 million population: 22% walked all the way, 8% used cycles and 44% used public transport. This adds up to 74% of people who rely on non-motorized transport for at least part of the commute.
Not only is walking a democratic form of transportation – it clearly ecologically friendly, healthy, enhances social interaction and gives the city a personality. Moreover, social interaction and street life have enormous economic value as this is what makes cities dynamic and creative. This is why the cores of all the world’s great cities are consciously walkable – central London, Paris, Manhattan, Singapore and so on. Yet, walkability is barely considered in Indian urban planning. Indeed, large sums are spent on “road widening” which is a euphemism for reducing pedestrian space.
Whenever I make the case of walking in Indian cities, I am inevitably told that India is too hot for walking. This is not at all true. Singapore is the worst place in the world to walk – it is hot and humid and gets 200 days of rain a year. Yet, people walk everywhere because the city’s urban design allows for it. As we have seen, the vast majority of Indians already walk. We need to invest in infrastructure that they can use.
Note that walkability and public transport must be embedded in urban DNA as soon as possible because it is very difficult to retrospectively change urban form. Take for instance, Atlanta and Barcelona. Atlanta has a metro network of 74km while Barcelona has one of 99km. These may seem comparable but per capita CO2 emissions for Atlanta are ten times that of Barcelona. The difference is mostly explained by Barcelona being compact while its American rival is spread out. As a result, less than 4% of Atlanta’s population lives within a reasonable walking distance of a metro station compared to 60% for Barcelona. If Atlanta now tried to give its citizens the same accessibility, it would have to build 2800 new metro stations and 3400km of new tracks!
All this needs a big change in urban thinking. A brand new city like Gurgaon does not have any network of sidewalks at all! In the next three decades, rapid urbanization will make India an urban majority country. We will need to create new urban spaces to accommodate 350-400 million additional town-dwellers by expanding old cities, urbanizing villages and creating brand new centers. Walkability must be the central planning paradigm for this.
(This article was published as the Economic Times editorial on 7th October 2009)

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Delhi needs strategic interventions, not master-plans
Few cities in the world have been as dramatically transformed as Delhi in the last hundred years. From a decayed Mughal city at the end of the nineteenth century to grand imperial capital and then to the capital of independent India. It is now one of the largest and fastest growing mega-cities in the world. Spread across three states, the metropolitan region has a population of 16mn. However, this apparent success hides virtual civic collapse. Despite ambitious master-plans and large sums of money, Delhi has proved unmanageable. Is there another way?
The dismal history of Master-Plans
According to the Delhi District Gazeteer1883-84, Delhi had a population of 173,303 in the late nineteenth century. The grandeur of the Mughal court was long forgotten and, after 1858, it was no more than a large provincial town. That changed when the British colonial government decided to shift the capital to Delhi in 1911 and hired Edwin Lutyens to design a city to reflect imperial grandeur. Lutyen’s created what is effectively the first “master-plan” for New Delhi. It was meant for a population of 60,000 – mostly government officials and their retainers. The old city was still expected to remain the commercial hub.
Lutyen’s Delhi was completed in the mid-thirties but the urban plan collapsed barely a decade later as the city found itself with hundreds of thousands of refugees fleeing West Pakistan. The authorities dealt with the crisis with ad-hoc arrangements but in 1962, a new master-plan was devised. Given the thinking of the times, it was a framework for low-rise suburbia where the government would decree land-use and zoning. From their “commanding heights” the planners declared that “there is undesirable mixing of land-uses almost everywhere in the city.” Just as the government has the right to control economic activity through licenses, it also has the right to tell people where to live and where to work.
The 1962 master plan was a dismal failure. The city developed in unpredictable ways while the government failed to deliver on many promises. Even by 1981, only three of fifteen district centers proposed in the master-plan had been developed. Offices, clinics and shops moved into residential areas as the designated commercial areas were grossly insufficient. Even by 1992, with the population now at 9 million, only six of the fifteen district centers were developed.
Liberalization created economic opportunities that pushed the gap between plan and reality to breaking point. Eventually the pressure exploded out into brand new areas like Gurgaon and Noida. The official response was yet another master-plan announced in 2007 called Delhi 2021. Two years later it already looks outdated.
Why master-plans do not work
The most obvious problem with master-planning in Indian cities is the lack of governance. The civic authorities simply do not have the ability to enforce the master-plan even in the national capital. Secondly, all master-plans require proper implementation and sequencing of public investment. As discussed earlier, a combination of corruption and incompetence meant that important aspects of the 1962 master-plan remain unimplemented even today.
There is, however, a more fundamental flaw with the whole master-planning approach. It is a vestige of socialist-era thinking that presumes a predetermined trajectory of urban development. Therefore, it cannot deal with organic evolution of a living and vibrant city. It is the same reason that the Mahalanobis model of economic planning was doomed to fail. There was no way in which Lutyens could have predicted Independence and Partition in 1913 and the 1962 master-plan could have anticipated Gurgaon’s BPO boom.
Indeed, master-planning has failed in most cities in the world. Singapore is one of the few exceptions but, even in this case, success has been mostly due to the Singaporean government’s unique ability to think strategically and to adjust the model constantly. India lacks the technical, administrative and political capability needed for continuous policy risk-taking. So what is the alternative? In my view, the governments who run the National Capital Region should concentrate on two things – basic governance and a few strategic interventions.
Back to Basics
My criticism of master-planning does not mean that I am advocating a free-for-all. Even in a market economy, the State is needed to provide basic governance and public goods. Thus, the NCR needs a simple set of municipal rules regarding property rights, traffic, street-hawking, advertising signage and so on. The government should concentrate on enforcing these rules. Similarly, the authorities should worry about parks, public health, sewage disposal and other public amenities. The government should not be concerned about whether or not an up-market restaurant should be allowed in an abandoned mental asylum in Mehrauli.
Strategic Interventions
Of course, the government will, from time-to-time, need to make large strategic interventions in order to cut through intractable gridlocks in the urban eco-system. . However, these should strictly be interventions that will open out new urban vistas and have large multiplier effects. The Delhi Metro is an example of such a strategic investment that was necessary to get away from Delhi’s reliance on roads. The Metro is changing the urban eco-system of Delhi in unpredictable ways, but that is the idea.
Another intervention in the same vein is the proposal to clean Delhi’s 300km network of nullahs and turn them into a network of walking paths criss-crossing the city. This would dramatically improve the last-mile connectivity of public transport, encourage walking for short trips and encourage social interaction; not to mention improve drainage and sewage disposal. This is a cheap and simple intervention but has the potential to fundamentally change Delhi’s DNA. Again, the exact outcome is not pre-determined but it opens up a whole new way for Delhi to evolve (interested readers can visit: this link).
To conclude, its time we cut through the Gordian Knot created by the traditional approach of formulaic command-and-control master-plans. Instead, the administration of Delhi should go back to basic municipal management. At the same time, long term issues should be dealt with strategic interventions that have systemic multiplier effects rather than by micro-managing a pre-ordained master-plan.
(The author is Founder, Sustainable Planet Institute and Sr. Fellow, WWF)

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Our new cities need to be dense and walkable

Mahatma Gandhi had once famously said “India lives in its villages”. With the urbanization of China in the last twenty years, India is the last major country with a rural majority (65-70% of the population still lives in villages). However, this is changing very rapidly. Within fifteen years, states like Tamil Nadu, Maharashtra and possibly Gujarat and Punjab will have an urban majority. By 2040-45, we can expect the country to have an overall urban majority. This transformation will have important implications for the social, cultural, economic and political landscape of the country.

Environmental sustainability is a critical area that will be affected by the shift. To the lay person, it may appear that urbanization is an unmitigated disaster for the environment. International experience suggests, however, that what really matters is the type of cities we build. Take for instance, Barcelona and Atlanta – both former Olympic hosts with populations of around 2.8mn and with roughly the same standard of living. Yet, studies have shown that the per capita ecological footprint of Atlanta is four times that of Barcelona! Indeed, Barcelona’s per capita environmental impact is lower than that of many rural areas of Europe. So, how can we ensure that India’s future urban trajectory follows Barcelona rather than Atlanta?

The importance of urban form

There has been much discussion in the media recently about “green” buildings. A plethora of “green codes” have been initiated including LEED, GRIHA and so on. My discussions with leading architects suggests that these codes typically give us energy savings of around 15% (higher savings are possible but they involve sharply higher costs). This is a useful saving but it cannot account for the difference between a Barcelona and an Atlanta.

The problem with so-called green codes is that they exclusively focus on maximizing an individual buildings whereas the real gains come from overall urban form: Is the city dense or sprawled? Do people live in apartments or free-standing houses? Is the city designed for public transport?.For instance, energy use drops by over 30% just by moving people from houses to apartments even if we ignored the green codes. Similarly, public transport systems do not work efficiently when the city is spread out and commuters cannot easily walk to the bus/metro stop.

Atlanta has a metro network of 74km while Barcelona has one of 99km. These may seem comparable but, per capita CO2 emissions for Atlanta are ten times that of Barcelona. The difference is mostly explained by urban form. Barcelona is compact and dense while its Americal rival is spread out. The longest possible distance within the city is 137km while in Barcelona it is only 37km. As a result, less than 4% of Atlanta’s population lives within a reasonable walking distance of a metro station compared to 60% for Barcelona. Not surprisingly, a large proportion of Barcelona’s citizens walk or use public transport while in Atlanta one is forced to use a car.

Interestingly, the very same factors affect environmental, economic, and social sustainability. Manhattan is not just the densest urban area in the US, it is also an economic powerhouse, a lively socio-cultural center and has the lowest per capita ecological footprint in North America. In Asia, we see the same factors at work in Tokyo, Hong Kong and Singapore.

Implications for India.

As India transforms itself into an urban majority country, we will need to accommodate another 350-400mn people in urban spaces. The existing large cities are already bursting at the seams and we will have to expand existing towns/cities, urbanize villages and build brand new towns. This requires a sensible template for urban planning. The above discussion shows that urban form, particularly density, must be a critical part of the thinking. The implications of this line of thinking, however, can be counter-intuitive. For instance, it suggests that the crowded bazaars of Mumbai are more environmentally sustainable than then green lawns of Lutyen’s Delhi.

So what should we do? First, we need to give up creating flat urban sprawls based on out-dated ideas about American suburbia. We are still expanding cities by carving out small plots and parceling them out to individual owners (as happened in Gurgaon). In turn, this is gobbling up farm and forest land. This must stop.

Second, public transport must be built into the urban design. In particular, we need to recognize that the most important form of public transport is “walking”. Even in a city like Mumbai, half of the people walk to work. The ratio is even higher in small towns. In addition, the last mile of all other forms of public transport has to be walked. This means that the vast majority of people walk all or part of each journey. Yet footpaths, pedestrian crossings, and over-bridges are rarely given priority in Indian urban planning. To the contrary, road widening (euphemism for narrowing the side-walk) is given high priority.

Finally, we need to get away from designing urban spaces according to the sterile aesthetics of real estate brochures. It is no longer meaningful to design for separate “zones” for commercial and residential activity (except for hazardous industries). Successful cities are an evolving mix of all kinds of activity and we need to allow for this. Even the much maligned street hawkers are a part of the city and a part of Indian urban tradition. Urban planners need to design them into the urban landscape (for instance, Singapore has created a successful network of hawker-centers across the city).

Its not just the mega-cities

India’s future urbanization is not just about migration to mega-cities like Delhi, Mumbai and Bangalore. In an earlier column, I had argued that it is essential that we revive small moufassil towns as economic, social and cultural centers (“Small Town India holds the Key”, Business Standard, 11th June 2009). The above principles of sustainable design apply equally to them even if the details have to be modified to local circumstances. In other words, we should not be building sprawled developments in small towns just because land is cheap.

To conclude, we need to build next generation cities on the basis of density and walkability. This needs to be internalized in our urban thinking as soon as possible because it is very difficult to change urban form retrospectively. According to the World Bank’s World Development Report 2009, for Atlanta to achieve Barcelona’s metro accessibility it would require 3400km of new tracks and 2800 new stations. Similarly, if we retrospectively densified Lutyen’s Delhi, we would severely strain the infrastructure and probably gridlock the rest of the city (imagine driving from Vasant Vihar to Connaught Place without being able to speed down Shanti Path). Thankfully, much of urban India is yet to be built and we have an opportunity to change our model in time for the coming urban boom.

(This article appeared in Business Standard on August 5, 2009)

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