Our Ci­ties Made Boon­docks

The Bud­get ig­nores ur­ban In­dia, where 2/3rd of In­dia’s GDP is gen­er­ated

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Given the events in­clud­ing de­mon­eti­sa­tion lead­ing up to the Bud­get, this Bud­get was dis­ap­point­ing. While it con­tains some el­e­ments of reform — be­ing pre­sented early to en­able the fuller util­i­sa­tion of out­lays, the merg­ing of the Rail­way with the gen­eral Bud­get, and the do­ing away of the dis­tinc­tion between Plan and non-Plan ex­pen­di­ture — the Bud­get is dis­ap­point­ing as it holds very lit­tle for ur­ban In­dia, where more than twothirds of In­dia’s GDP is gen­er­ated.

The fi­nance min­is­ter him­self ac­knowl­edged in the Bud­get speech that “In­dia has be­come the sixth-largest man­u­fac­tur­ing coun­try in the world, up from ninth pre­vi­ously. We are seen as an en­gine of global growth.” And in this very con­text, it is ur­ban In­dia that is home to the coun­try’s man­u­fac­tur­ing — and ser­vices — in­dus­try, given the def­i­ni­tion of ur­ban ar­eas by the Cen­sus hinges on the share of non-agri­cul­tural employment.

Themes­suchas­the­p­oor,the­un­der­priv­i­leged, in­fra­struc­ture and pub­lic ser­vices that the Bud­get has pro­posed to fo­cus upon, also en­com­pass the ur­ban poor. Ur­ban poverty is more chal­leng­ing than ru­ral poverty, given the ur­ban poor have the threat of food se­cu­rity, so­cial ex­clu­sion, and eco­nomic and phys­i­cal vul­ner­a­bil­ity (threat of evic­tion, lack of ‘le­gal’ sta­tus of hous­ing and ameni­ties, which lo­cal gov­ern­ments don’t find de­cent enough to reg­u­larise).

With­out the ur­ban poor, who cont- ribute sig­nif­i­cantly to the city econ­omy as work­ers, driv­ers, maids and cooks, sub­stan­tial parts of the ur­ban econ­omy would come to a stand­still.

The gov­ern­ment also claims to “have moved from [an] in­for­mal econ­omy to [a] for­mal econ­omy”. But the ur­ban in­for­mal sec­tor con­tin­ues to be ne­glected. One thing Bud­get1991and re­forms changed was the li­cence raj as it ap­plied to the cor­po­rate sec­tor.

But more than 25 years later, the ur­ban in­for­mal sec­tor con­sist­ing of street ven­dors and poor work­ers is plagued by an equally, if not more, cum­ber­some li­cence raj, and con­tin­ues to be un­der the threat of evic­tion, with­out a sus­tain­able liveli­hood.

There is now a na­tional pol­icy on street ven­dors. But the con­di­tions of th­ese in­for­mal sec­tor work­ers have not per­cep­ti­bly changed.

House of Tax

Yet an­other basic ele­ment that im­pacts the ur­ban poor is the lack of af­ford­able hous­ing and ac­cess to ameni­ties.

As per the Bud­get, the profit-linked in­come-tax ex­emp­tion for pro­mot­ers of af­ford­able hous­ing with a 30 sq m limit will ap­ply only to the four met­ro­pol­i­tan ci­ties. In the rest of the coun­try, in­clud­ing pe­riph­eral ar­eas of four met­ros, the limit of 60 sq m will ap­ply.

In In­dia, poli­cies for tack­ling af­ford­able hous­ing are typ­i­cally in the na­ture of sup­ply-side ini­tia­tives, al­though this cat­e­gory is too neat to de­scribe the ac­tual in­ter­ven­tions. Such poli­cies treat only the symp­toms, not the un­der­ly­ing causes of the mal­ady. At­tempts by pol­i­cy­mak­ers to fix prob­lems with hous­ing af­ford­abil­ity may be fu­tile, un­less the un­der­ly­ing causes of the hous­ing scarcity — ex­ces­sively re­stric­tive land-use reg­u­la­tions — are ad­dressed.

Fur­ther, there is also the reg­u­la­tory is­sue of li­cens­ing and per­mits re­quired at every stage, which de­vel­op­ers have to face in the de­vel­op­ment B R V Shanbhag

With ci­ties be­com­ing un­liv­able, we need to de­velop vil­lages and small ur­ban ar­eas and make them at­trac­tive so that the peo­ple stop mi­grat­ing to the ci­ties. The gov­ern­ment shouldn’t bur­den the big ur­ban con­glom­er­a­tions fur­ther.

Chan­drasekaran Kr­ish­na­murthy of hous­ing projects.

The cost of th­ese end up be­ing passed to the end user — the home­buyer — thereby ques­tion­ing all as­sump­tions of af­ford­abil­ity.

The only ini­tia­tives for ur­ban In­dia in this Bud­get are that the min­istry of hous­ing and ur­ban poverty al­le­vi­a­tion (MoHUPA) out­lay in­creased from .₹ 5,285 crore (re­vised in 2016-17) to .₹ 6,406 crore in the cur­rent Bud­get, and that of the min­istry of ur­ban de­vel­op­ment (MoUD) in­creased from .₹ 32,550 crore to .₹ 34,212 crore.

For the MoUD’s Atal Mis­sion for Re­ju­ve­na­tion and Ur­ban Trans­for­ma­tion (AMRUT) and Smart Ci­ties, the Bud­get al­lo­ca­tion has ac­tu­ally de­creased to .₹ 9,000 crore from .₹ 9,559 crore in 2016-17. Some time ago, the MoHUPA an­chored a large project, Sup­port to Poli­cies for Ur­ban Poverty Re­duc­tion. This re­sulted in an Ox­ford Univer­sity Press vol­ume on the state of the ur­ban poor, which doc­u­mented valu­able re­search per­tain­ing to the ur­ban poor in In­dia, us­ing var­i­ous ci­ties as case stud­ies. I hope the MoHUPA can con­tinue to fund si- mi­lar re­search on ur­ban poverty with its mea­gre bud­get.

The Bus Stops Here

A new metro rail pol­icy will be an­nounced with its fo­cus on in­no­va­tive mod­els of im­ple­men­ta­tion and fi­nanc­ing, as well as stan­dard­i­s­a­tion and in­di­geni­sa­tion of hard­ware and soft­ware. But what about bus trans­port? Re­search con­clu­sively shows that for de­vel­op­ing coun­tries, roads serve the aam aadmi well — as long as buses are there — while con­nect­ing peo­ple for var­i­ous other pur­poses.

Notwith­stand­ing the Delhi Metro’s success, this mode of trans­port is ex­pen­sive, needs a lot more in­fra­struc­ture, and still can’t ‘ship’ mil­lions.

Life in ur­ban In­dia will go on with­out any dis­cernible change to the way in which the poor live, schol­ars con­duct ur­ban re­search, and com­muters travel. Even after this Bud­get.

The writer is pro­fes­sor, Cen­tre for Re­search in Ur­ban Af­fairs, In­sti­tute for So­cial and Eco­nomic Change, Ben­galuru. Views are per­sonal

Glance and gaze

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