Combating Challenges To Build Smart Cities: Lessons From India
In the next 15 years, about 200 million people will move from rural areas in India to the country’s urban centers and the shift will be massive, almost equal to the current populations of France, Germany, and the United Kingdom combined, according to a McKinsey report. It adds that while urbanization increases productivity and improves GDP per capita over the long term, by 2030, urban centers in India will generate nearly 70 percent of the country’s GDP, causing significant pressure in the cities.
In his recent article, Suveer Sinha, a partner in McKinsey’s Mumbai office mentioned that while government data estimates that India’s cities would need $1.2 trillion in capital funding over the next 20 years to keep up with the demands of their growing populations. But the country has nowhere near that amount to spend: India requires around $134 per capita to support urbanization capital expenditure (capex), but it actually spends around $20 per capita. . Cities in many emerging markets are also facing similar strain as people flock to work and live in urban centers.
Sinha, in his article said that the right effort to make a city smart will incorporate a focus on sustainability, resource productivity, economic development, and job creation, as well as getting basic core infrastructure right to enable decent quality of living. In terms of smart city solution implementations, taking a cue from India’s Smart Cities mission, he offered several best practices for city leaders in emerging countries.
Engage citizens early and often
Efforts must begin with a comprehensive citizen engagement initiative, said Sinha. Under India’s program, every city identified one or two core pan-city issues that it would like to solve. Different cities across India chose mobility, governance, water, energy, security, and solid waste management as their top themes. For example, while Pune selected mobility and water as the main pan-city themes, Bhubaneshwar selected intelligent city operations. Most cities that came out on top of the competition engaged extensively with residents to identify their core concerns. By asking citizens for their input from the very beginning, city authorities must share updates on a regular basis while seeking input on progress, the quality of execution, and new ideas.
Use competition to improve quality of planning
The Smart Cities Mission granted funding to cities based on project proposals submitted by each city. The competition between cities resulted in high-quality submissions that identified specific objectives and resources and were aligned with citizens’ expressed priorities. While every city was given seed capital from the government, they were encouraged to come up with innovative sources of funding to bridge the gap between this seed capital and the money needed to fulfill their plans. These source ideas included land monetization, public-private partnerships, and other sources of revenue like developmental charges, said Sinha.
Think beyond technology
While technology is a primary driver of India’s smart-city development efforts, the government also encourages cities to think about development more holistically. Each city came up with a plan to develop a relatively small area (approximately 1,000 acres) and improve its living standards by addressing core infrastructure challenges such as water access, solid waste management, and open space. For example, Kochi devised a plan to retrofit seven square kilometers of land, linked throughout by waterways. This plan included the creation of seamless multimodal transportation, the renovation and renewal of open spaces, and the inclusion of essential public services such as sanitation, water, and waste management. The key lesson here was that it was understood even a relatively small area could be developed and revitalized to achieve higher standards of livability; funding sources were more accessible for planning these pockets of land, given their smaller size.
Building smart and affordable real estate
One example of this quick-win strategy played out in Pune. Leaders set out on a quick-win placemaking mission—that is, creating public spaces that capitalize on existing assets to promote health, happiness, and well-being—to rejuvenate urban centers. Sinha explained that the city redesigned streets to improve safety and walkability and brought multiple use cases to citizens through a smart element project that created and wove together six key components:
- Wi-Fi hotspots across strategic locations such as parks, hospitals, and other public spaces
- Environmental sensors to monitor critical parameters such as air quality and noise pollution
- Public announcement systems to broadcast both general and emergency messages to improve communication and public awareness
- An emergency response system to increase citizen safety
- A variable message system that deployed electronic display boards, placed across the city, to broadcast messages, alerts, and city updates
- A scalable command and control center to monitor and manage smart-city operations from a single hub
Ensure vendor participation through partnership
Many smart-city projects are relatively small, which does not attract large investors. And in India, some of these projects are being executed for the first time, which means the city must significantly rework the solution to apply locally. For example, implementing a sophisticated traffic management system in India or another emerging market is vastly different from doing so in a developed economy, as emerging markets tend to have a different transportation mix—for example, a large number of two-wheeled scooters and motorcycles.
In such a situation, Sinha said it is important to have a partnership mind-set to tailor and cocreate the solutions with vendors, so that these solutions are truly effective in the emerging-market context.
Sinha concluded in his article that citizens are not looking for one-off projects; they are looking for solutions that will fundamentally affect their lives. Following the above tactics in implementing a smart-city program can help leaders in emerging markets develop and achieve these solutions. And ensuring everyone across the value chain, especially city authorities, is aligned and focused on the solution is perhaps the single most important point that will make a smart-city mission successful, he summed up.
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