An ideal scenario: A coastal city with shiny new buildings. Trees are planted on every side of the street and the air is automatically purified each hour. You can pay with your phone and charge your car at every parking place. A dream? This isn’t a modern science fiction novel, but is happening as we speak. These technologies are being developed in China, often in cooperation with Western companies.
The above is what is now termed as ‘smart city’. Smart cities are a hot topic and a commonly used buzzword today. This concept primarily involves combination of human capital and technology to create a sustainable environment. Such cities work towards improving sustainable economic development, infrastructure and also create a higher quality of life for the citizens as they contribute to this process.
China probably identified this opportunity one of the earliest and acted its way through in creating several such smart cities. McKinsey Global Institute wrote in 2009 that China’s urban population will grow from 527 million in 2005 to 926 million in 2025. Cities with a population exceeding 1 million are likely to increase from 153 to 226 in that same period. In 2011, the Chinese National Bureau of Statistics announced that China’s urbanisation rate had surpassed 50%. This was the first time in China that more citizens were living in cities than in rural areas.
An important drive for developing smart cities is the rising middle class. Another report from McKinsey in 2013 considers consumers in China with household incomes between 106,000 to 229,000 yuan to be the upper middle class. According to McKinsey, in 2012, this segment accounted for just 14% of urban households. Their estimates for 2022 show a turnaround, with 56% becoming upper middle class and 14% mass middle class, which are household incomes ranging from 60,000 to 106,000 yuan.
Does India fit into the above scenario? Do we see a rising opportunity in creating smart cities which, in turn, creates a sustainable environment for its citizens?
Urbanisation in India has significant implications for the future development of the country. By 2030, India’s urban population will touch 590 million or nearly twice that of the US, while Indian cities will generate close to 70% of the GDP.
This will exert tremendous pressure on urban infrastructure and services. It is, therefore, imperative that we find innovative solutions for the urban challenges of growth and sustainability.
This dramatic growth also provides impetus for the creation of smart cities which leverage information and communications technology (ICT) to greatly improve the productivity, lifestyle and the prosperity of our people. Additionally, green growth strategies can build environmentally sustainable cities.
India has 50 cities with more than a million people; China now has more than 350. Job creation needs new cities because it will replace the current short-term thinking of taking people to jobs with a more sustainable solution of taking jobs to people. There will be strong regional disparities in the next 20 years; five states in the South and West of India (Gujarat, Maharashtra, Tamil Nadu, Karnataka and Andhra Pradesh) will see 50% of the country’s GDP growth but only 5% of population growth. We must define urbanisation carefully; it is not about relocating more people into the larger cities nor is it about well-planned economic wastelands like Chandigarh. We have seen emergence of small pockets of economic success in areas like Gurgaon near Delhi, Gachibowli near Hyderabad, Magarpatta near Pune, Whitefield in Bangalore and Mohali near Chandigarh, but these are from far being identified as smart cities.
The next question is, how do we create these smart cities? The recent announcement from the government to create a ‘Digital India’ is a positive move. A budget of $1.2 billion has been allocated for smart cities alone. This should encourage some of the big-wig technology firms to submit proposals to local governments, and collaborate with real estate developers to build sustainable green cities.
Industrial corridors between India’s big metropolitans like the Delhi-Mumbai Industrial Corridor, the Chennai-Bangalore Industrial Corridor and the Bangalore-Mumbai Economic Corridor seem a positive move. It is hoped that many industrial and commercial centres will be recreated as ‘smart cities’ along these belts. The Delhi-Mumbai Industrial Corridor (DMIC), which is spread across six states, seeks to create seven new smart cities as the nodes of the corridor in its first phase.
The very idea of smart cities is based on the assumption that there are technocratic solutions for the routine problems that citizen face. Problems of inefficiency that are seen to dominate the old bureaucratic-political order are hence given a ‘smart’ solution by employing ‘Big Data’.
Another positive impact of the ‘smart city’ and ‘Digital India’ projects is job creation, which will be, needless to say, ‘smart’. While it is difficult to give an estimate of jobs that will be generated and the reduction in labour migration, one can confidently say that even if work begins on 5-10 smart cities over the next two years, we would have created a favourable ecosystem for many thousands of jobs. This will be more inclined towards white-collar jobs as IT professionals will be in greater demand; IT infrastructure being the backbone of any smart city. Data analytics, programming, high-end consulting, system and network integration will be the order of the day and professionals and students in this area can expect better opportunities. It is a great time and opportunity for the ‘Internet of Things’, as they call it.
With a burgeoning urban population, there is an immediate need for creation of infrastructure facilities to satisfy the increasing urbane aspirations of our populace and smart cities seem to the solution. While the focus seems to have shifted towards smart cities and urbanisation, care must be taken so as to ensure the large percentage of population that relies on unskilled jobs and agriculture are not left behind.
By Mohit Gupta
The author is co-founder & director, TeamLease Services
