Part 6 of the series highlights the challenges and advisory solutions the government should factor in while planning to implement Smart cities in India.
The ambitious Smart Cities program/ initiative is not devoid of challenges. All cities are vastly different from each other and come with their own set of issues and obstacles. Some of the latent issues to consider when reviewing a Smart City strategy include-
Quick Approval and Clearance
Availing approvals and clearances from any government institution is a time consuming process. Since the projects are time bound, all clearances and approvals must be granted within the stipulated deadlines so that the projects do not suffer any delays. To speed up the processes, approvals can be automated and made online. This needs to be changed while developing smart cities by deploying newer technologies- Big Data and Internet of Things (IoT). Big data technology can be tapped to enhance the design, construction, operation and maintenance of the built environment. Meanwhile, Internet of things can help control operations and maintenance of built environment assets & their components effectively. Further a board can be set up to manage approvals for services offered.
Channelling Finance to the Smart Cities
The Per Capita Investment Cost has been estimated to be INR 43,386/- as reported by the High Power Expert Committee (HPEC). The total estimate of investment in implementing smart cities is INR 7 lakh crore within a span of 20 years and an annual requirement of INR 35,000 crore, assuming the population. Mobilizing such huge finance is a challenge for any government. Sourcing funds through public private parnerships, Viability Gap Funding are couple of ways to deal with this challenge. While ~20% of the net investment is from the government, the remaining investment has to be raised by the respective State governments, Union territories and through other private bodies.
Co-ordination among Multiple Stakeholders
The central government faces severe coordination issues while implementing smart cities nationally as there are too many stakeholders involved. State governments, union territories, private sector, central government and other regulatory bodies are stakeholders in the smart cities’ initiative. The roles and responsibilities need to be further defined with streamlined process flows and shared across the board to spread awareness. There should be no room for conflicts in segregation of duties that might arise due to individual or departmental workflows.
Retrofitting Existing Cities
Retrofitting primarily means revamping existing cities to make them more efficient. The challenge lies in aligning new solutions to the existing master plan of the city, which is not available for >80% of the cities. The Government has to customize solutions and adopt a city-specific approach on the resources available, funds, citizen engagement and state control.
There is a dire need for skilled workers and professionals to build 100 smart cities, some from scratch. It is important that adequate training programs are conducted for the workers employed in this project. There should be contests and programs organized to motivate skilled labor.
Availability of Utility Services
Smart cities require uninterrupted access to electricity and water. Considering the power generation and distribution systems in the existing states and union territories, this is anticipated to pose a challenge in meeting the growing energy demands. States must explore alternate, non-conventional energy resources to meet the energy requirements.
Most of the cities covered under Smart Cities Program comprise of special economic zones/investment regions, with modified tax structures and laws that favor foreign investments. This will lead to a conducive environment for investors, HNIs and real estate developers.
Government has already started working on the above challenges. It has launched 14 projects of Pune Smart City’s plan. There is a plan to build 60 million homes; 40 million in rural areas and 20 million in urban under the ‘Housing for All’ scheme by 2022. There has also been a subsequent increase in forest cover, better monitoring and controlling of pollution with various environmental approvals alongside. A Special Purpose Vehicle (SPV) has also been created for each city to implement its Smart City action plan.
Government has approved the National Smart Grid Mission (NSGM), which will act as an institution for planning & implementing policies and programs related to smart grid activities.
In the next part of this series, we explore Indian Smart Cities’ from a real estate prespective.