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India’s Flagship Urban Missions – Smart Cities and AMRUT
India has launched two flagship schemes to drive urban transformation and economic growth – The “Smart Cities Mission” and the “Atal Mission for Rejuvenation and Urban Transformation (AMRUT)”. The focus on creating better cities is a welcome development, at a time when India’s urban population is expected to increase to 600 million by 2030, from 400 million today.
The “Smart Cities Mission” will cover 100 cities with the objective of promoting area-based urban development initiatives that are replicable. The key focus of the Smart Cities Mission is to provide a decent quality of life to citizens through “Smart” solutions, enabled by technology applications, while maintaining a clean and sustainable environment.
The “Atal Mission for Rejuvenation and Urban Transformation (AMRUT)” will cover 500 cities. AMRUT seeks to provide basic services (e.g. water supply, sewerage, urban transport) to improve the quality life for all, especially the poor and the disadvantaged.
While the Smart Cities Mission looks to promote innovative practices for sustainable urban development, AMRUT focuses on the basic services needed in urban areas such as water supply, sewerage, urban transport. Both these missions have been designed based on learnings emerging from the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), the previous urban development scheme administered during 2007-2014. The following table provides summary information on the key features of both these new missions:
| Program Parameters | Smart Cities | AMRUT | Remarks |
| Coverage | 100 cities | 500 cities | Increased from 65 cities covered under the erstwhile JNNURM |
| Duration | 5 years (FY 2015-16 to FY 2019-20) | 5 years (FY 2015-16 to FY 2019-20) | |
| Program roll out | Year 1: 20 citiesYear 2: 40 citiesYear 3: 40 cities | All cities simultaneously | |
| Approach |
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Project-based approach for city level service improvement covering the following civic services:
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The Smart Cities Mission will promote area level innovation consisting of multiple sector specific development activities like transport, mixed land use, energy efficiency, renewable energy, etc. This approach is being adopted in India for the first time. |
| Priority Areas | Comprehensive development of the selected areas including but not limited to:
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Assured piped water supply and sewerage connections to all households is the first priority for all AMRUT cities. Prioritisation among other basic amenities will be the prerogative of the urban local Body (ULB). | Clear guidelines have been provided to the cities in order to promote sustainable practices in all proposals. |
| City Eligibility criteria | Based on their urban population and number of statutory towns, various states have been initially allocated a maximum number of cities adding up to 100 cities in total at the national level. States will choose individual cities within their allotted quota and submit the list for approval by the MoUD. MoUD will shortlist the cities to be covered in various phases based on:
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The city eligibility criteria for the Smart Cities Program ensures that the better performing cities qualify for funding. This is a departure from JNNURM, where projects were funded primarily in larger cities that could not execute them due to a variety of constraints. |
| City selection process | The cities will be shortlisted through a “Cities Challenge” that will be conducted by Bloomberg in three stages:Stage 1: States conduct their internal assessment to identify the cities to be proposed to the Smart City Mission under their approved quotaStage 2: 100 shortlisted cities from all states become eligible to submit their ‘Smart City proposal (SCP)’ to participate in the cities challenge
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All eligible cities within a state will prepare Service Level Improvement Plans (SLIP) for funding. All SLIPs will be aggregated by the State Government into the State Annual Action Plans (SAAP) for a three year duration. The SAAP will be appraised by the Apex Committee of the MoUD which will approve proposals that are found satisfactory. | While under the JNNURM, cities were directly accountable to the MoUD, the framework for both the Smart Cities and AMRUT Missions focus on decentralising the decision-making process. The responsibility for identification of cities and finalisation of the SAAPs now lie with the State Urban Development Departments. The City Governments will continue to develop their own proposals.The cities that establish linkages between the program elements prescribed for the AMRUT and Smart Cities Missions, in their proposals, will stand a better chance of winning the competitive selection process. |
| Implementation | The cities that win the challenge program will create Special Purpose Vehicles (SPV) to implement their SCPs. The SPV will be registered under the Companies Act and will create full time staffing e.g. CEO, CFO, etc. The SPV will have nominees from Central, State and City Governments on its board.Majority equity in the SPV will be from the State and the City (equal shareholding) and the remaining can be raised from private investors/ financial institutions.SPV will be given powers to recruit high quality professionals for project execution. | The City will be responsible for project implementation. They can involve other para-statals like the Development Authority, Water Supply and Sewerage Board, etc. depending on the nature of their proposed project. | There is very limited precedence, in India, of setting up of SPVs for urban infrastructure projects. The SPV arrangement has been tried for some public transport projects like Metro, BRT and City Bus Systems only but not at a city level. Many of these SPVs have become successful, and hence there is inclination to adopt this means under the Smart City and AMRUT Missions. |
| Financial arrangements |
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The learnings from the JNNURM have been incorporated into the program design for the Smart Cities and AMRUT Missions. Although JNNURM sanctioned a total of 2,815 projects with an average implementation duration of two years, only 253 projects could be completed within the lifetime of the Mission (2007-2014). The implementation progress was tardy due to the following reasons: |
The provision regarding the creation of SPVs clearly reflects the intent to leverage investments from the private sector for creating the necessary urban infrastructure. This is a departure from the traditional urban development investment mechanisms of the Government of India. The MoUD will support credit worthiness assessments for cities to remove existing impediments for private investments. |
| Program management | A three tier management structure has been proposed to manage the projects:
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A three tier management structure has been proposed to manage the projects:
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Greater emphasis has been laid on the role of State Governments in monitoring the Missions’ progress. This was not the case in JNNURM, where the MoUD was directly monitoring city-level initiatives. This proposed new mechanism seems to be more effective and the project management structure along with accountabilities is built in at multiple layers.At the city level, the creation of a multi-stakeholder advisory forum will ensure greater and meaningful interactions between the legislative, executive and user groups. |
The learnings from the JNNURM have been incorporated into the program design for the Smart Cities and AMRUT Missions. Although JNNURM sanctioned a total of 2,815 projects with an average implementation duration of two years, only 253 projects could be completed within the lifetime of the Mission (2007-2014). The implementation progress was tardy due to the following reasons:
- Lack of implementation capacities within City Governments
- Absence of top–down and bottom-up integrated resource planning mechanisms
- Funding limitations
- Inadequate knowledge of best practices
- Lack of inter-agency co-ordinations and lack of participatory approach in planning
Most of these issues have been addressed in the Mission Statements and Program Design Guidelines of Smart Cities and AMRUT Missions. The proposed implementation framework for these Missions is widely different from the earlier programs of the MoUD i.e. Jawaharlal Nehru National Urban Renewal Mission (JnNURM) and Urban Infrastructure Development Scheme for Small & Medium towns (UIDSSMT). The current Missions put greater emphasis on the environmental sustainability, governance, financial and service delivery reforms, self-reliant revenue mechanisms, etc. Both JNNURM and UIDSSMT could not meet their physical and financial progress targets, and so complying to more ambitious targets set under Smart Cities and AMRUT Missions is likely to throw up significant implementation challenges. Recognising this, the Government of India has preferred implementation under public private partnership mechanisms to augment capacities at the city level by bringing on board implementation acumen of the private sector. Still, the States and Cities will require technical support for efficient execution. This is particularly true for many of the first of its kind features that have been included in these two Missions e.g. sustainability considerations in developing infrastructure projects, structuring public private partnership arrangements, participatory approaches to project planning and management through extensive public consultation and engagements, etc.