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Policy approaches to Maximum Cities

Suman Bery 

Challenges, Opportunities and the Way Forward
Edited by Isher Judge Ahluwalia,

Ravi Kanbur and P K Mohanty
Sage; 360 pages; Rs 850

In 2008, the Indian government constituted a high-powered expert committee (HPEC) on urban infrastructure and services. The committee was chaired by Isher Judge Ahluwalia, one of the editors of the present volume. As the editors note in their preface, the "paucity and unreliability" of information on the state of service delivery and investment in urban infrastructure, and the scarcity of empirical research on issues facing the urban sector, presented a major challenge to the ability of the committee to undertake its task. This is despite the work of bodies such as the National Institute of Urban Affairs, recent work by the McKinsey Global Institute and the extensive urban support over many decades from the World Bank and the Asian Development Bank. Given the immense importance and complexity of the issues, this volume is a welcome addition to the literature. I would like to compliment the editors and Sage, the publisher, for an extremely well-produced product with admirably few errors.

Fourteen authors have contributed to nine thematic chapters in the book, apart from a useful introductory chapter by the editors. These nine chapters are logically clustered into three sections: urban planning, infrastructure and sustainability; finance and governance; and inclusion and governance. As these section headings suggest, a central concern of the editors is with institutional dimensions of urban reform - urban finance, urban planning and urban service delivery - and this is also the impression conveyed in the introduction. They observe that "addressing the challenges of urbanisation in India is above all a question of reforming institutions and governance", adding that it is of equal importance to build the capacity of local government bodies to "analyse, assess, manage and implement".

The introductory chapter provides a basic framework for public policy intervention. This draws upon the economics of agglomeration, economist-speak for the benefits that arise when people live and work in proximity to each other. It is the existence of such benefits that explains the existence of cities as a form of social organisation and productive activity for most of recorded history. According to this theory, once a process of agglomeration starts, there is an inbuilt tendency for it to continue until private costs (typically congestion-related) equal private benefits. Since individuals do not directly appropriate all the agglomeration benefits they generate, there is an initial tendency to under-urbanise, and government intervention is appropriate to nudge the process along. The opposite problem also arises: individuals are not typically fully assessed for the congestion costs that they generate. Again, the government can in principle play a role in aligning social and private incentives.

The thematic chapters make relatively little use of this theoretical framework in their diagnosis and recommendations. In particular, the individual papers do not give one a concrete sense of the optimal scale of Indian cities, and the relationship that cities and towns of various scales ought to bear to each other. The focus of the volume is, therefore, on improving the management of individual urban jurisdictions, rather than on shaping the urbanisation pattern in India as a whole.

The focus on institutions raises a range of broader issues, of which I list three. The first question is: where are the politics? In a discussion of demand-side governance and technocratic solutions, one struggles to find space for the blood and guts of party politics. One would dearly like to have some views on whether politics will lead or follow. If the present election marks the coming of age of the urban voter, will urban reform find a more willing constituency? And will the new order be any less hostile to mayors with genuine power than the earlier dispensation?

This question raises a second issue: who is the intended reader of these essays? Here, the answer seems somewhat clearer. India has an honourable tradition of government commissions that slowly shape the climate of debate, partly by providing the all-important bureaucracy its script. So the present volume can rightly be seen as a second act to the work of the HPEC, if a suitably motivated government were to choose to address urban management seriously.

In turn, this raises the third question: how have other countries done it? One thinks, of course, first of China, which seems to have an inexhaustible supply of the basic skills of surveying, architecture, design and construction. India is coming late to a party that the whole world has been at for the last hundred years. What lessons from abroad are relevant?

Finally, while it is commonplace to note the central role of cities in growth and innovation, it is less common to see the links drawn with energy, emissions and sustainability. I was pleased to see this focus in a chapter by Montek Singh Ahluwalia and Ajay Mathur in the volume. Urban reform can make a crucial difference to the energy footprint of cities and thereby contribute significantly to energy security and to emissions management, as demonstrated in a body of work supported by Shell in recent years.

The reviewer is group chief economist, Royal Dutch Shell.

These views are personal

First Published: Thu, April 24 2014. 21:25 IST