Skip to main content

India's municipal expenditures one of the poorest in the world, a major barrier to urbanization: UN-Habitat report

All figures in % of GDP
A new study by the United Nations Human Settlements Programme (UN-Habitat), “World Cities Report 2016: Urbanization and Development – Emerging Futures” has regretted extremely low levels of “aggregate municipal expenditures in India”, which happen to be of the worst in the world.
“With only 1.1 per cent of GDP, municipal expenditures in India compare very unfavourably with OECD countries, but even with other BRICS countries such as Brazil, Russia and South Africa. In Latin America, several countries have significantly changed their municipal financial systems”, the report says.
Pointing out that Colombia, previously a highly centralized country, could give a good example on how to raise municipal expenditures, the report says, it has gone through “different phases of decentralization, beginning in the late 1970s.”
The report says, “With a new constitution in 1991, more responsibility was delegated to the municipalities, accompanied by a dramatic increase in transfers from the central to the local level, so that by 1997, municipalities’ expenditures were almost seven per cent of national GDP.”
Poor municipal expenditures in India, the report suggests, is particularly regrettable, as “urban areas contribute more than 60 per cent of GDP and an extra 300 million new urban residents are projected by 2050, leading to a call by the Indian Government to build 100 new cities over the period.”
While this would mean a major challenge for climate change, the report says, this would necessitate building “denser, low-energy, low-infrastructure cities.”
And here, it underlines, “Central to this challenge are the twin bottlenecks of municipal finance, i.e. lack of tax revenues to provide urban services, and infrastructure finance for transport, electricity, communications, water supply, and sanitation in support of production.”
Pointing out why quick urbanization would pick up, the report says, “In India, between 2000 and 2005, urban employment grew at a rate of 3.22 per cent compared to rural employment, which grew by 1.97 per cent.”
It believes, “Urbanization can play a key role in eradicating rural poverty. Research in India found that an increase of 200,000 in the urban population resulted in a decrease of 1.3 to 2.6 per cent in rural poverty. Overall, these urban-rural linkages were behind a reduction of 13 to 25 per cent in rural poverty in India between 1983 and 1999.”
The report says, mega-regions – such as the Delhi-Mumbai Industrial Corridor (DMIC) – will come to play “an increasing role in various dimensions of prosperity”, the report says, at a time when due to “external and domestic factors” the economy decelerated, “one of India’s “strategic initiatives was to transform the Delhi-Mumbai highway into an industrial corridor.”
“The DMIC involves industry and infrastructure in a 150-200 km band on either side of a 1,500 km dedicated railway freight line. Approximately 180 million people, or 14 per cent of the population of India, will live there. The idea is to develop an industrial zone, with eco-cities spanning across six States, together with industrial clusters and rail, road, sea and air connectivity.
“Plans include 24 ‘market-driven’ cities comprising regions with special investment regimes and industrial zones. The scheme places a whole new meaning on the scope and scale of urban economic corridors”, the report underlines.

Comments

TRENDING

World Hijab Day? Ex-Muslim women observe Feb 1 as No Hijab Day, insist: 'Put it on a Man'

I didn't know that there could ever be a thing as World Hijab Day until I received an email alert from Maryam Namazie of the Council of Ex-Muslims of Britain (CEMB), stating that several ex-Muslim women's groups had observed the same day—February 1—as No Hijab Day! According to Namazie, the day "was created on February 1 as a direct response to World Hijab Day" to "illuminate the coercive and oppressive realities of the hijab as a pillar of sex apartheid and a war on women."

Why predictions of an imminent collapse of the Russian economy may be wrong

A veteran Canadian journalist, settled in Russia, stated in a Facebook post that President Donald Trump "is apparently listening to experts who tell him that Russia's economy is on the verge of 'imploding,' and if he just squeezes a bit harder," his Russian counterpart Vladimir Putin "will fall into line."

Talking of increased corporate control over news, Rajdeep Sardesai 'evades' alternative media

When I received an intimation that well-known journalist Rajdeep Sardesai was to speak at the Ahmedabad Management Association (AMA) on February 2, my instant reaction was: I know what he is going to say—his views are quite well known; he wouldn’t be saying anything new. Yet, I decided to go and listen to him to catch his mood at a time when the media, as he (and I) knew it, is changing fast due to the availability of new technological tools that were not accessible even a decade ago.

Google powered AI refuses to correct grammar of a 'balanced' piece on Trump sending chained immigrants to India!

This is a continuation of my blog on how, while the start-up-developed AI app DeepSeek is being criticized for consistently rejecting content related to China or Maoism, there appears to be no mention in Western media about why another app, developed by the powerful Google, Gemini, remains silent on Indian political issues.  

Gujarat a police state? How top High Court advocate stunned a senior-most journalist

Rajdeep Sardesai, Anand Yagnik This is a continuation of my earlier blog on well-known journalist Rajdeep Sardesai's lecture in memory of the late Achyut Yagnik at the Ahmedabad Management Association (AMA). I was a little surprised when I received the intimation about the venue for the lecture.

5% poor in India? Union govt claim debunked, '26.4% of population below poverty line'

A recent paper, referring to the Household Consumption Expenditure Survey (HCES) 2022-23 of the Government of India (GoI), has debunked the official claim that poverty has substantially declined. Titled "Poverty in India: The Rangarajan Method and the 2022–23 Household Consumption Expenditure Survey", the paper —authored by scholars CA Sethu, LT Abhinav Surya, and CA Ruthu—states that "more than a quarter of India’s population falls below the poverty line."

DeepSeek censors uncomfortable queries on China, but why's Gemini so touchy on India?

The powerful Chinese AI app DeepSeek, which has taken the Silicon Valley by surprise, as it has capacities matching Google’s Gemini and Open AI's ChatGPT, is being criticised for restricting free speech, and rightly so. It is being said that those signing up for the chatbot and its open-source technology "are being confronted with the Chinese Communist Party’s brand of censorship and information control."

Gujarat's water anarchy? 16.7% of Narmada water going to industry, 33% of targeted area irrigated: Govt insider

The Narmada project is something that has always excited me, including how much water will be distributed and to which sector. A few days ago, when I was talking to a top Gujarat government insider, I was a little surprised when I was told that it is up to the “respective states to decide how much Narmada water they would distribute among various sectors” out of the total quota allocated to the four states—Madhya Pradesh, Gujarat, Maharashtra, and Rajasthan—as per the Narmada Water Disputes Tribunal award of 1979.

Russians at a Bali yoga camp to avoid drafting for war? Things aren't any different in Ukraine

Are people in Russia becoming frustrated with the prolonged war in Ukraine? And is the war having a similar impact on the people of Ukraine? I have no firsthand information about this, but it is well known how nationalist hysteria often seeks to conceal such frustration, particularly among the youth.