Getting ready for the cities of the future
The Budget states that the fruits of development reach an increasingly large number of people, the pace of migration from the rural areas to the cities is increasing. A neo middle class is emerging and it aspires to have better living standards. Unless new cities are developed to accommodate this burgeoning class, the existing cities would soon become unlivable.
The prime minister has a vision of developing one hundred smart cities, as satellite towns of larger cities and by modernising the existing mid-sized cities. To provide the necessary focus to this critical activity, finance minister Arun Jaitley said he had provided a sum of ₹ 7,060 crore in the current fiscal.
“To encourage development of smart cities, which will also provide habitation for the neo-middle class, requirement of the built-up area and capital conditions for FDI is being reduced from 50,000 square metres to 20,000 square metres and from US$10 million (₹1crore) to US$ 5 million (₹50,000) respectively with a three year post completion lock-in. Recent budgetary announcements for FDI policy in construction development that will impact the smart cities Minimum built-up area reduced from 50,000 to 20,000 sq m Minimum capitalisation reduced from US$ 10 million to US$ 5 million Projects committing 30% of project cost to low-cost affordable housing are exempted from minimum built-up area and capitalisation requirements