If India continues with its current trend of ‘poorly planned, sprawling and unconnected’ pattern of urbanisation, it could cost the country upto USD 1.8 trillion by mid-century, according to a new study from the New Climate Economy. The report, ‘New Climate Economy on India’s urbanisation potential’, said: “Better and smarter urban growth, could be an economic opportunity for India, worth up to 6% of GDP by 2050.”
“Continuing the current poorly-planned, sprawling, unconnected pattern of urbanisation, could impose an estimated cost of between USD 330 billion and USD 1.8 trillion by mid-century. At the household level, this equates to more than 20% of average household incomes,” the report said.
Analysing satellite data of night-time lights, the report found that Indian cities that were more compact in 2002, experienced faster economic growth from 2002-2012. “On average, across a sample of 479 Indian cities, a 10% increase in a city’s dispersion index in 2002 is associated with a 0.4%-0.9% decrease in economic growth over the subsequent period,” it said.
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The problems in India’s present urbanisation model
It noted that there are a number of negative impacts or costs associated with India’s current urbanisation model, ranging from increased costs of providing public infrastructure and services, transportation costs, traffic casualties, traffic congestion, air pollution and health risks, among other considerations.
“The costs of providing public infrastructure and services, are likely to be as much as 30% higher in more sprawled, automobile-dependent neighbourhoods, compared with more compact, connected locations. Fourteen of the world’s 30 most-polluted cities are in India and outdoor air pollution in Indian cities is estimated to cause around 1.1 million premature deaths per year. India also has the largest number of total traffic deaths of any country – 1,37,572 were officially reported in 2013,” it said.
The report noted that India’s urban sprawl is different from other countries and is best described as a low density of built-up floor space per unit of land area, combined with severe overcrowding per unit of built-up area. “For example, Mumbai’s homes have only about 30 sq ft per person, less than a quarter of the comparable availability in urban China. Countering the urban sprawl in India, will require a greater emphasis on appropriate or good density, combined with adequate provision for accessible and well-connected infrastructure and services,” it said.
Recommended reforms for urban India
The report also recommended reforms and progress in three key areas, to help deliver social and economic benefits for urban India:
- Reform of land regulations, to manage urban expansion and to improve the efficiency and effectiveness of land use.
- Expansion of sustainable urban infrastructure, to encourage appropriately compact, connected, and coordinated cities.
- Reforms to strengthen urban local government, accountability and financing.
India’s urban population reached 420 million (33% of its total population in 2015) and this is expected to double to 800 million by 2050. By 2031, 75% of India’s national income is expected to come from cities and the majority of new jobs will be created in urban areas, the report said.
“Poorly planned, sprawled, private vehicle-dependent model of urban growth, can have significant economic, social and environmental costs which undermine prosperity,” it said.
The report was prepared by the the New Climate Economy (NCE), the Coalition for Urban Transitions, the Indian Council for Research on International Economic Relations (ICRIER) and the WRI Ross Center for Sustainable Cities, in partnership with the University of North Carolina at Chapel Hill and the Global Spatial Research Program on Spatial Development of Cities at the World Bank.