India Needs 2.4 Trillion To Build Future Ready Cities By 2050
ECONOMY & POLICY

India Needs 2.4 Trillion To Build Future Ready Cities By 2050

The report finds India needs two point four trillion (tn) dollars to build future ready cities by 2050. India's cities are already home to around one third of the country's population yet municipal corporations generate revenues equivalent to zero point six per cent of national gross domestic product. Urbanisation is set to accelerate, with urban population projected to reach nearly 600 million (mn) by 2036 and 877 mn by 2050 and cities expected to contribute almost 75 per cent of GDP by mid century.

To support this growth the report estimates financing needs of 840 bn dollars in urban infrastructure over the next 15 years, or roughly 55 bn dollars annually. It notes that nearly 70 per cent of the urban infrastructure required by 2047 has not yet been built, highlighting the scale of development that remains. The authors point to the concentration of economic activity in a handful of metropolitan centres and the underutilisation of many Tier-II and Tier-III cities.

The report recommends a range of measures to strengthen urban financing and governance, including building investment ready cities with stronger financial management, improving institutional capacity, using data driven planning, expanding economic growth beyond major metropolitan areas and promoting climate resilient sustainable development. It advocates adoption of a polycentric urban growth model that would see multiple cities develop as economic hubs rather than concentrating growth in a few large metros, supported by economic corridors and initiatives such as PM Gati Shakti which could unlock new engines of growth.

The report identifies the Centre's Rs one tn Urban Challenge Fund as a key step to strengthen municipal finances and expects cities to mobilise 50 per cent of project costs through capital markets which could catalyse nearly Rs four tn in urban investments. It records progress under flagship programmes with over 8,000 projects worth over Rs one point six four tn completed under the Smart Cities Mission and Rs two point seven tn committed under AMRUT. Ultimately it finds urban transformation will depend on stronger municipal finances and sustained long term investment.

The report finds India needs two point four trillion (tn) dollars to build future ready cities by 2050. India's cities are already home to around one third of the country's population yet municipal corporations generate revenues equivalent to zero point six per cent of national gross domestic product. Urbanisation is set to accelerate, with urban population projected to reach nearly 600 million (mn) by 2036 and 877 mn by 2050 and cities expected to contribute almost 75 per cent of GDP by mid century. To support this growth the report estimates financing needs of 840 bn dollars in urban infrastructure over the next 15 years, or roughly 55 bn dollars annually. It notes that nearly 70 per cent of the urban infrastructure required by 2047 has not yet been built, highlighting the scale of development that remains. The authors point to the concentration of economic activity in a handful of metropolitan centres and the underutilisation of many Tier-II and Tier-III cities. The report recommends a range of measures to strengthen urban financing and governance, including building investment ready cities with stronger financial management, improving institutional capacity, using data driven planning, expanding economic growth beyond major metropolitan areas and promoting climate resilient sustainable development. It advocates adoption of a polycentric urban growth model that would see multiple cities develop as economic hubs rather than concentrating growth in a few large metros, supported by economic corridors and initiatives such as PM Gati Shakti which could unlock new engines of growth. The report identifies the Centre's Rs one tn Urban Challenge Fund as a key step to strengthen municipal finances and expects cities to mobilise 50 per cent of project costs through capital markets which could catalyse nearly Rs four tn in urban investments. It records progress under flagship programmes with over 8,000 projects worth over Rs one point six four tn completed under the Smart Cities Mission and Rs two point seven tn committed under AMRUT. Ultimately it finds urban transformation will depend on stronger municipal finances and sustained long term investment.

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