The 100 cities selected by the government under the Smart Cities Mission (SCM) have been undertaking development and upgradation projects aimed at giving citizens access to essential infrastructure, a clean and sustainable environment, and quality of life through the use of smart solutions. During the past year, however, there have been some setbacks for the mission owing to the Covid-19 outbreak and other challenges, which compelled the government to postpone the implementation deadline to June 2023.
A look at the progress and implementation status of the government’s flagship urban transformation programme…
Progress so far
According to the mission guidelines, the central government had planned to provide financial assistance of Rs 480 billion to 100 smart cities for over five years. The state government was required to contribute a similar amount. As of March 3, 2023, the central government has allocated a sum of Rs 374.56 billion for the mission and the state governments have released a similar share of Rs 322.29 billion. The total release for the mission has been Rs 696.85 billion. Of this, about 86 per cent (Rs 597.91 billion) has been utilised. In terms of physical progress, as of March 3, 2023, of the total 7,799 projects, 69 per cent (5,399 projects) have been completed and 2,400 projects are ongoing.
The SCM focuses on sustainable and inclusive development with the help of smart and digital solutions. The projects being implemented focus on improving municipal services, addressing issues related to climate change, increasing the use of public transport and promoting non-motorised vehicles, and having better monitoring and coordination within cities.
Water and waste
Water and waste management is an important aspect of the SCM. The water and waste projects under the mission focus on ensuring adequate water supply, separating the drainage with sewage and managing day-to-day garbage disposal in a sustainable manner.
Under the SCM, the Tiruchirappalli City Municipal Corporation is implementing drinking water source augmentation, new pipeline installation and well renovation projects. The 24×7 drinking water supply project is expected to be completed by June 2023. It involves redeveloping the existing collector well at Kambarasampettai and constructing a new surface-level water tank with a capacity of about 2 million litres of water. Additionally, six surface-level storage tanks are being constructed. With this, the drinking water supply is expected to be increased by 30 million litres per day (mld).
The Nagpur Municipal Corporation has started installing bins across the city. Having installed 1,200 twin bins at an investment of Rs 20 million, the corporation now plans to install 2,800 more bins of 100 litres each in the city. The city corporation has also installed 200 smart bins with a capacity of 1,100 litres each. These are equipped with sensors and fire detectors. Besides, Itanagar Smart City Development Corporation Limited is undertaking waste management and disposal to overcome issues such as air, water and soil pollution. Besides, the New Town Kolkata Development Authority had started installing smart bins in the town with AI-based sensors, which will prevent overflowing of waste. These bins will be based on internet of things (IoT) ultrasonic sensors, having a capacity of 120 litres each.
Urban mobility and public transport
Smart and sustainable solutions can solve challenges faced by urban mobility and public transport in India. An efficient transport system in a city helps reduce transaction costs at all levels and becomes a facilitator for the economic growth and liveability of a city.
The Uttar Pradesh government, under the SCM, is planning to have electric vehicles and charging facilities throughout the state. The state government is coordinating with NITI Aayog and the Asian Development Bank (ADB) in preparing the Construction Environmental Management Plan for Lucknow, which will be extended to 17 cities. Similarly, the Delhi government has also approved the induction of 1,500 low-floor electric buses in its fleet in the coming years by the Delhi Transport Corporation. Additionally, it plans to add 450 compressed natural gas (CNG) buses in the city.
The Kerala State Road Transport Corporation (KSRTC) flagged off 131 new buses in Thiruvananthapuram, equipped with all modern facilities such as mobile charging facilities at every seat, anti-lock braking system, onboard diagnostics, GPS, an inbuilt announcement system, etc. Earlier, as part of the SCM, the city corporation had launched 50 e-buses and another 113 e-buses are planned for launch by June 2023. Similarly, 250 e-buses were added to the fleet in Nagpur taking the total number of e-buses in the city to 480.
With the arrival of 5G services, cities are now enabled with a range of smart applications such as traffic management, public safety, healthcare and environmental monitoring. Using 5G networks, smart city systems can collect and analyse huge amounts of data from sources such as video security cameras, intelligent traffic lights, and other IoT devices.
According to a report by CRISIL Ratings, the 5G user base in India is expected to reach around 300 million by 2025 from 20 million-25 million in March 2023. Subscribers of 5G services will provide a fillip to data consumption because they would upgrade to higher data packs for better speeds, which will drive up the overall average revenue per user, return metrics for telcos and drive the growth of smart cities in the country.
Digitalisation and sustainability
Smart cities make use of technologies and data integration platforms to monitor, control and optimise every project across sectors such as water, transportation, energy, etc. Smart city technologies have proliferated among urban populations as a result of their ability to offer creative solutions that may enhance quality of life in a variety of ways, including improved efficiency and sustainability. IoT technology and secure wireless connectivity are changing the conventional aspects of city life. For instance, next-generation intelligent lighting platforms with extended capabilities, integrated with solar power and connection to a cloud-based central control system are replacing traditional street lights in smart cities.
The four essential elements of smart and sustainable flourishing cities include pervasive wireless connectivity, open data, security and flexible monetisation schemes. With the use of these innovative solutions such as information and communication technologies, smart cities can create an enabling environment to generate decarbonisation solutions across sectors such as energy, transport, etc. This intends to enable the cities to reduce carbon emissions for delivering resilient and equitable urban ecosystems.
The government has been encouraging cities to make use of innovative financing sources such as public-private partnerships (PPPs) and municipal bonds for financing projects at the city level. The SCM has adopted traditional and innovative funding mechanisms for many projects. These include grant aid from the government, debts from financial institutions and participation of the private sector through the PPP mode. PPP has been widely adopted by 55 smart cities such as Ajmer and Dahod. These include projects worth more than Rs 180 billion on a PPP basis under the SCM.
Similarly, municipal bonds are being introduced in smart cities for undertaking various projects. As per the latest updates, the government has decided to identify 30 cities with good performance ratings, to issue municipal bonds to raise capital for infrastructure projects. Municipal corporations and city authorities do not have a good track record of financial stability and discipline. This makes it difficult for them to raise capital from the debt market. So far, these city authorities have been dependent on central and state governments for grant-in-aid. Between 1997 and 2022, municipal bonds have only raised Rs 62.5 billion, while in the US, this stands at $4 trillion, accounting for about 16 per cent of the country’s GDP. As per a recent development, Indore Smart City has planned to use green bonds to reduce its financial burden related to the drinking water needs of the city.
While municipal bonds will be a new source of revenue for cities, it will be a considerable time till they become autonomous and financially stable entities capable of raising funds in the market. Till then, central and state grant-in-aid will continue to be the main driver.
Of the 100 smart cities, 22 cities including Bhopal, Indore, Agra, Varanasi and Chennai are expected to complete project implementation by mid-2023. The remaining smart city projects are progressing fairly well and are expected to be completed by mid- to end 2023.
India is moving towards becoming a $5 trillion economy and the development of smart cities is set to play a major role in this vision. This apart, the SCM concept needs to be complemented with the development of smart villages for a holistic transformation.