Lackluster planning and execution marred both urban development schemes; to see 100 smart cities as envisaged, we need corrective policy and effective governance
On March 3, Amitabh Kant, former CEO of NITI Aayog, wrote a curious piece in a national daily.
“Our cities are grappling with overcrowding, pollution and poor health, but these are not insurmountable challenges. The time for change is now, and the next decade will determine the fate of our cities. They can become smart, green and livable, or succumb to pollution, congestion and insecurity,” he wrote.
He went on to suggest: “Transforming our cities will require an overhaul of planning, strengthened governance and sustainable financing…States must take the lead.”
Back to square one
Kant’s views are not only ironic but also take India back to square one – to June 2015, when the Smart Cities Mission (SCM) was launched, and further back to 2012, when its precursor, the UPA-era Jawaharlal Nehru National Urban Renewal Mission (JNNURM), ended in a failure.
In short, no lessons have been learnt. Here is why.
When Kant was the CEO of NITI Aayog, from February 2016 to June 2022, the SCM was in full swing. His recent plain speak came days before the Mission completed a decade. With no sign of a fourth extension, this means curtains for the SCM.
The SCM’s aim was to “improve the quality of life in 100 cities by providing efficient services, robust infrastructure and sustainable solutions” – precisely what Kant 'proposes' now.
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The SCM was to carry this out by focusing “on economic growth, inclusivity and sustainability”, addressing “diverse needs such as housing, transport, education, healthcare and recreation, with the goal of creating adaptable urban spaces that serve as models for other cities”.
As the apex think tank, the NITI Aayog defined the SCM, gave it a “reference framework” and also suggestions for its success. Kant’s article is an admission of its failure – exactly for reasons that had led to the JNNURM’s failure. Logically, those should have been addressed but weren’t. Before listing those, here is a backgrounder.
New and old cities
When Prime Minister Narendra Modi announced 100 smart cities in 2014, it was about both new (greenfield) one and retrofitting existing ones with high-tech communication capabilities to make them 'smart'. Recall the hype at the time around Dholera (Ahmedabad rural) and GIFT City (Gandhinagar), which Modi had begun building in Gujarat as chief minister (both now remain work-in-progress).
Everyone assumed that India would build new smart cities like China, South Korea and the UAE did. The new cities were presumed to come along the Delhi-Mumbai Industrial Corridor (DMIC) and other industrial corridors that were in the pipeline then.
When the SCM was officially launched a year later, on June 25, 2015, it came with two overlapping schemes – the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) to provide basic infrastructure in 500 existing cities, and another called Housing for All by 2022.
AMRUT ended up as a scheme for “water management” alone (Economic Survey 2024-25) and the SCM ended up as a new version of the failed JNNURM.
Also read | How the monsoon flushed away tall claims on Smart Cities project
What hit SCM
The Economic Survey of 2024-25 said that as on January 13, 2025, Rs 1.5 lakh-crore had been spent on 93 per cent of the proposed infrastructure projects (7,479 of 8,058 proposed). Other reports showed that projects were completed only in 18 of 100 planned smart cities and 7 per cent projects were likely to go on beyond March 31, 2025.
A Parliamentary Standing Committee in February 2024 raised the following points:
(i) Greenfield development is required around cities to address the needs of the expanding population.
(ii) Many smart cities didn’t have the capacity to plan and spend thousand-crore projects.
(iii) Pan-city projects did not comprise more than 50 per cent of total projects in 76 of 100 smart cities.
(iv) Frequent changes, dropping or shelving of projects, frequent transfer of SPV (special purpose vehicles) officials and non-representation to local bodies, experts in urban development and other stakeholders to ensure clear accountability, decision-making and transparency in the working of SPVs.
(v) Need for deeper engagement of public representatives in execution.
(vi) Need to draw a plan for the maintenance of infrastructure and digital assets created.
(vii) Lack of robust mechanism for coordination and monitoring.
(viii) Expected funds could not be generated through PPPs (public-private partnerships). PPPs didn’t take up half of the proposed projects and those taken up saw just 6 per cent of their total cost under PPP.
Also read | 'Smart Cities' to 'Livable Urban Spaces', Modi govt pivots as original mission stumbles
The panel recommended that the Centre get a third-party assessment of the various projects undertaken under the SCM and consider launching the next phase, SCM-II.
The reasons listed above were precisely the flaws and recommendations for JNNURM (2005-12), including going for JNNURM-II after addressing those flaws.
JNNURM’s failure
The JNNURM was launched in 2005 with a seven-year mission period (2005-12) covering 65 cities with a budget of Rs 1 lakh-crore. A CAG report of 2012 showed very poor outcomes with thousands of projects remaining incomplete due to delays in funding and deficiencies in planning and execution.
A steering committee of the Planning Commission listed the flaws: “poor planning” and near absence of people’s participation leading to “lack of ownership”; “acute capacity deficit” at the municipal level; focus on expenditure-related targets rather than improvements in service-level outcomes; “one-size-fits-all” approach to reforms and failure to carry out “crucial” reforms relating to rationalisation of user charges, property tax, land market etc.
This report is no longer available in the public domain, but these flaws underline multiple other Planning Commission reports of the time. Ironically, Arun Maira, then Planning Commission member who helmed the JNNURM and also the steering committee report that listed its flaws, had called it a success at the end of the project period (“I term JNNURM a success") stating that it was a first-of-its-kind innovation, a large pilot project from which many valuable lessons were learnt for the future about urban planning and rejuvenation.
Apparently, no lessons were learnt.
Going forward
The promised 100 smart cities are not to be seen anywhere. Cities, including major metros, continue to be highly polluted, flooded every monsoon, and traffic jams and slums are part of daily urban life. But giving up is not an option.
The urban population is expected to double to 800 million over the next three decades. There is a need for corrective policy and governance steps. Besides, a recent Reserve Bank of India (RBI) report says, “more than 50 per cent of the MCs (municipal corporations) cover less than half of their revenue expenses”, implying that urban local bodies can’t mobilise funds to make urban life livable or sustainable.
A World Bank report of November 2024 said India needs Rs 70 lakh-crore over 15 years, or Rs 4.5 lakh-crore a year. Its 2022 report had said India needs $840 billion for the next 15 years, or $55 billion a year.