Smart Cities Mission Takes off With 877 Projects Worth Rs 1.47 lakh cr

It is just 16 months since the first list of Smart Cities was announced in January 2016. Within this short span the 60 cities who made it to the coveted Smart Cities list so far, have managed to prepare a list of 877 projects worth Rs 1.47 lakh crore to make these cities smart and more liveable. Special purpose vehicles (SPVs) have been set up in all the cities barring new Kolkata due to political reasons.

Though the Smart Cities mission was launched in June 2015, the actual process of announcing the smart Cities started in January 2016 when the first lot of 20 cities were announced followed by another 13 cities in May 2016 and another 27 cities in September 2016. The cities were selected based on their performance on several parametres such as proper sanitation facilities, reforms under JNNURM, online presence and performance of the municipal bodies.  

Of the 877 projects, work on 69 projects have already started with an estimated investment of about Rs 4,727 crore and bids have been invited for 462 projects worth Rs 15,307 crore. Projects worth Rs 49,785 crore are in different stages of implementation, a senior official who did not want to be named said.

Work on projects worth Rs 500 crore have been completed. Companies like IBM, L&T, IL&FS, Google, Sterlite and Schneider are some of the key players who have picked up most of the contracts in the smart city projects.

"We are constrained by one thing which was somewhat predictable, which is capacity. If we can overcome that hurdle of having the capacity to deliver on myriad sort of aspects of smart cities which are spread across sectors starting from healthcare to mobility issues. Once this happens only then will people see and realise what smart cities are all about. But for this to happen will take time. Its hardly been two years. You cannot shortchange the Smart Cities Mission by asking to deliver something today. We are on a steep learning curve, the momentum should not be lost," said Jagan Shah, Director, National Institute of Urban Affairs.

To overcome the capacity constraint, government has trained 13,000 municipal employees in fields such as town planning, revenue, municipal finance and engineering. Twenty seven agencies including TERI and IITs have been empaneled to train the municipal staff. Next month the government is organizing a training workshop in IIM Ahmedabad for the top brass of municipal corporations.

The municipal bodies have done away with the system of L1 bids wherein the lowest bidder gets the project. They have now adopted the quality cum cost based (QCCB) bidding method so that quality is not compromised.

20 cities have invited bids for creating an integrated command control centre in each of these cities. "This command centre will store all data related to traffic, security cameras, water management systems etc so that there is better coordination and the data can also be used for analysis to further improve the delivery system," the official said.

The government has empaneled SBI Cap, Srei Infrastructure Finance Limited, HDFC and ICICI to act as transaction advisors for the municipal bodies and bring about financial reforms.

About 40% of the 270 municipal bodies have received credits ratings of BBB and above which means they can now go for market borrowings and can access funds from other sources too. Cities like Pune and Ahmedabad are in advanced stages of issuing municipal bonds to raise money.

“India is a very large country and an elephant takes time to move, to change direction and to dance. You are asking a very large, very diverse elephant to dance and we have started the journey barely two years ago. Two years is like a blink of an eye in urban infrastructure. Having said that, some of the cities like Jaipur where we are doing river rejuvenation projects, Pune where we are doing smart street lighting, are moving ahead very fast. The challenges are in heritage cities and cities which are politically active. The biggest challenge is how to retrofit technologies, safety, resilience and sustainability factors into cities without disrupting lives of common people,” Gautam Balakrishnan, Head, Smart Cities Business, Tata Projects said.

“Smart city is not just about creating infrastructure and using technology just for the sake of it. The idea is to use technology to improve the delivery systems. What we are focusing in smart cities is letting the people of the city tell us what they want, what they think will make their city smart. The core of the Smart Cities Mission is increased peoples’ engagement. Like for people of Udaipur its all about conserving their lakes. Another example is what people from Bengaluru told us. They think Bengaluru 40 years back is smart for them. It was more green, clean and healthy. It was more liveable,” the senior official said.

Some of the cities who have managed to take the lead include Kakinada, Bhopal, Pune, Vishakhapatnam, Surat, Sholapur and Bhubaneshwar. The next list of smart cities will be announced in the next 15-20 days, the official said.

Under the Smart Cities Mission, government plans to build 100 Smart cities over the next 5 years.