india's urban transformation the way forward symbiosis 4 march 2013

India’s Urban Transformation:

The Way Forwardiihs

Symbiosis, Pune 4th March 2013

Aromar Reviarevi@iihs.co.in ; @AromarRevi

www.iihs.co.in

The challenge of contemporary Indian cities: integration of the pre-colonial, colonial, ‘modern’ & informal

Yamuna Pushta: c. 2003

Yamuna Pushta demolitions: Feb-May 2004

20112004

Yamuna Pushta Forced Evictions: Feb – May 2004

Dupont, 2011

A 30+ year process of state-led eviction, demolition and exclusion

Delhi: Demolished Settlements & Resettlement Colonies (1990-2008)

Dupont, 2011

Systematic processes of eviction and regularisation define Delhi’s land ‘market’

Pushta

Our future hinges on

the state of Indian

cities

Environmental Sustainability

Social Transformation

Unified & Robust Polity

Inclusive Economic Growth

Reduced Poverty and Inequality

Urban Development: catalysing five national outcomes by the 2030s

A long view of History

Relative National Share of Global Economic Output (1500 to 2050ACE)

0%

5%

10%

15%

20%

25%

30%

35%

1500 1600 1700 1800 1900 2000

% S

hare

of

Glo

bal

Ou

tpu

t

Time

US China India UK Japan Russia

India

ChinaUS

UKRussia

Japan

Asia returns to centre of the global economy after a gap of 250 years

Urbanisation: a key growth & economic development driver

New Geographies = New 21st century Histories

19- mid 20th century Late 20th century

Early- mid 21st century

16-18th century

Present consumption requires ~2.0 worlds

21st century Population growth needs 1.5+ worlds

Ending poverty at present throughput ~2.0 worlds

Availableonly One

World

The Challenge of the 21st century Sustainability Transition

The Sustainability traverse will be largely played out in Chinese & Indian cities

Himalayan Glacial melt (1921-2009)

‘Sustainable

Development’

Can China traverse the environmental Kuznets curve; Germany & USA converge without serious Human Development decline India ‘tunnel through’;

or will there be serious international ‘resource’ conflict?

Future History - Sustainability Transitions: 2005

China’s urbanisation: 1992-2012

Deng’s tour of the Southern provinces: Feb 1992

China’s urbanisation: the view from Space..

China: Feb 1992

China: Feb 2000

China: Feb 2008

Why is China’s urbanisation important?

1. It is the largest urbanisation in human history: the addition of ~300 million people to China’s urban population in 20 years

2. This propelled the largest economic growth surge in history

India’s urbanisation: the view across time..

Maurya Gupta Mughal British

Major Powers of the Indian Subcontinent

(500 BCE to 2010 ACE)

Hoysala Tuluva

India Urban Dynamics: 1951-2031

1951

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

India

W. Pakistan

E. Pakistan

Nepal

Tibet

India 1951

• Only 5 cities with a population > 1m and 41 with > 0.1m

• Much of India lived in 0.56 m villages

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Kolkata

(5.7)

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

1961

Large Urban Settlement Growth

Urban Population Growth

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Kolkata

(6.9)

1971

Mumbai

(5.8)

Large Urban Settlement Growth

Urban Population Growth

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Kolkata

(9)

Delhi

(5.6)

1981

Mumbai

(8.6)

Large Urban Settlement

Growth

Urban Population Growth

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Kolkata

(10.9)

Delhi

(8.2)

Chennai

(5.3)

1991

Mumbai

(12.3)

Large Urban Settlement Growth

Urban Population Growth

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Kolkata

(13.1)

Delhi

(12.4)

Chennai

(6.6)

Bangalore

(5.6)

Hyderabad

(5.4)

2001

Mumbai

(16.1)

Large Urban Settlement

Growth

Urban Population Growth

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Kolkata

(15.5)

Delhi

(16.9)

Chennai

(7.5)

Bangalore

(7.2)

Hyderabad

(6.7)

Ahmedabad

(5.7)

Pune

(5.0)

2011

Mumbai

(20)

Large Urban Settlement

Growth

Urban Population Growth

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971- 2001

UN, 2007

IIHS analysis, 2009-10

3 cities with a

population > 10 m

and 53 with > 1m

833 m live in 0.64 m

villages

377 m live in ~ 8,000

urban centres

India 2011

• 3 cities with a population > 10 m and

• 53 cities with > 1m

• 833 m live in 0.64 m villages

• 377 m live in ~ 8,000 urban centres

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Urb

an S

ettl

emen

ts

0

100

200

300

400

500

600

700

800

1951 1961 1971 1981 1991 2001 2011 2021 2031

Po

pu

lati

on

(in

mill

ion

s)

Mumbai

(28.6)

Kolkata

(22.3)

Delhi

(24.4)

Chennai

(11.1)

Bangalore

(10.6)

Hyderabad

(9.9)

Ahmedabad

(8.5)

Pune

(7.4)

Surat

(6.3)

Kanpur

(5.1)

2031

Large Urban Settlement Growth

Urban Population Growth

> 5

1 - 5

0.5 - 1

0.1 – 0.5

< 0.1

Population Size (millions)

Source: Census of India, 1971-2001

UN, 2007

IIHS analysis, 2009-10

India 2031

• 6 cities with a population > 10 m and > 70 with > 1m

• How many Indians will live in medium & small towns?

• The bridge between rural & urban India

India’s urbanisation: the view from Space..

Feb 1992

Feb 2008

India: 13 Nov 2012

Spatial Concentration of Economic Activity: 2005

District agricultural output distribution: 2005

District Manufacturing output distribution: 2005

Top 100 Cities : 2011

0 10 20 30 40 50

Output

Population

Land

Proportion of all-India

Land

Population

Output

0.24%

16%

43%

26

5m

11

2m

20

0m

53

7m

22%17%

13%10%

7% 5%3%

21%

19%

18%

15%

12%

10%

8%

20%

21%

21%

20%

19%

18%

17%

17%

18%

20%

21%

22%

23%

24%

5%

8%

10%

12%

14%

16%

17%

3%1%

1%

1%

1%1%

1%

7%8%

8%

8%

8%8%

9%

1%2%

4%6%

7%8%

9%

3%3%

3% 3%4%

5%6%

1% 3% 4%2%

2% 3%

3% 4% 4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1951 1961 1971 1981 1991 2001 2011

Pro

po

rtio

n o

f A

ll In

dia

Po

pu

lati

on

(%

)

Distribution of India’s Population by Settlement Size : 1951-2011

Class I Cities

Other Urban Centres

Large Villages

Medium and Small Villages

Urban Growth & Sprawl: 1991-2011

1992

Delhi : 1992

8.7 million

8.7 million

1992

2000

Delhi : 2000

8.7 million

13.7 million

13.7 million

1992

2000

2011

Delhi : 2011

8.7 million

13.7 million

16.3 million

16.3 million

Bangalore : 1992

1992

3.4 million

3.4 million

Bangalore : 2001

1992

2001

3.4 million

5.7 million

5.7 million

Bangalore : 2009

1992

2001

2009

3.4 million

5.7 million

8.5 million

8.5 million

Chandigarh : 1989

1989

0.6 million

0.6 million

Chandigarh : 2000

1989

0.6 million

2000

0.8 million

0.8 million

Chandigarh : 2011

1989

0.6 million

2000

0.8 million

2011

1.0 million

1.0 million

Migration Trends: 1961-2011

0

10

20

30

40

50

60

70

80

90

100

1961-71 1971-81 1981-91 1991-2001 2001-2011

Urb

an P

op

ula

tio

n G

row

th (

in m

illio

n)

Components of Urban Population Growth : 1961 – 2011*

0

10

20

30

40

50

60

70

80

90

100

1961-71 1971-81 1981-91 1991-2001 2001-2011

Urb

an P

op

ula

tio

n G

row

th (

in m

illio

n)

Net Rural to Urban migration

Expansion in urban area / agglomeration

New towns less declassified towns

Natural Growth

Estimated Major Inter-State Migration Streams : 2001-2011

Estimated Top 50% Migration Streams into Urban Areas: 2001-2011

The national economic context: 1970-2010

0

10

20

30

40

50

60

70

1970-71 1975-76 1980-81 1987-88 1993-94 1999-00 2004-05 2009-10 (estimate)

Rs

Lakh

Cro

re

Urban

Rural

India Rural: Urban GDP share (1970-2009)

Early economic reforms

Phase I economic reforms

Phase II economic reforms

All amounts in constant 2009-10 prices.Source: National Accounts Statistics

Post-liberalisation boom in India’s urban economy, esp. In the Phase II period

India Rural: Urban GDP fraction (1970-2009)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1970-71 1975-76 1980-81 1987-88 1993-94 1999-00 2004-05 2009-10 (estimate)

Pe

rce

nt

of

Tota

l

Urban

Rural

Phase I economic reforms

Phase II economic reforms

Early economic reforms

All amounts in constant 2009-10 prices.Source: National Accounts Statistics

Above half of India’s GDP comes from ~8,000 urban areas

0

5

10

15

20

25

30

35

Rs

Lakh

Cro

re

Other Services

Public Admn & Defence

Real Estate & Business Services

Banking & Finance

Transport, Storage & Communications

Hotels & Restaurants

Trade

Construction

Electricity, Gas, Water

Manufacturing

Mining

Agriculture

India: Urban sectoral GDP growth (1970-2009)

All amounts in constant 2009-10 prices.Source: National Accounts Statistics

Manufacturing, trade, transport, banking and real estate primary drivers of the urban economy

India: Urban sectoral GDP structure (1970-2009)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Pe

rce

nt

of

Tota

l Other Services

Public Admn & Defence

Real Estate & Business Services

Banking & Finance

Transport, Storage & Communications

Hotels & Restaurants

Trade

Construction

Electricity, Gas, Water

Manufacturing

Mining

Agriculture

All amounts in constant 2009-10 prices.Source: National Accounts Statistics

Decline in manufacturing , construction and trade shares. Growth in transport, banking & real estate

India: Inclusive Wealth trends (1990-2008)

India’s Inclusive Wealth base is about 4 times its GDP.

Of this, the largest component is ‘human capital’

Dasgupta et. al, 2012

India’s Coming transition (2011-2031)

• India will add at least 300 million new people to its cities in the

next 30 years

• This is on top of the current urban population of ~300 million, of

whom over 70 million are poor

• In 2031, three of the ten largest megacities in the world will be in

India: Delhi, Mumbai, Kolkata

• Over 75 other cities will have a population of over 1 million

• This will be the second largest urbanisation in human history

creating huge market opportunities and development challenges

• The only option to avoid complete systemic urban breakdown is

the simultaneous transformation of India’s cities and its villages

• A wide range of technical, institutional and social innovations will

be required to enable this

0

5

10

15

20

25

30

Pe

rce

nt

of

Tota

lIndia: Urban Workforce distribution (2004-05)

Source: Sachar Committee Report, 2006

Two-thirds of the urban employment is in manufacturing, trade & other services.

India: GDP & Employment structure (2009)

The urban informal sector with a quarter of the workers produces roughly a quarter of the GDP. The urban formal sector with 5 percent of the workers produces a similar share of the GDP.

Source: NCEUS, 2009; Kannan & Raveendran (2009)

Urban Formal :

5%

Urban Informal :

25%

Rural : 70%

Urban Formal : 25%

Urban Informal :

26%

Rural : 45%

India: Urban Unorganized Sector GDP structure (1980-2009)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Pe

rce

nt

of

Tota

l

Other Services

Real Estate & Business Services

Banking & Finance

Transport, Storage & Communications

Hotels & Restaurants

Trade

Construction

Manufacturing

Agriculture

All amounts in constant 2009-10 prices.Source: National Accounts Statistics

Share of transport and real estate has grown, construction and trade remained steady and

manufacturing contributors to urban unorganised sector output declined

India: Urban GDP composition (2009-10)

0

0.5

1

1.5

2

2.5

3

3.5

Rs

Lakh

Cro

re

Organized

Unorganized

Urban India has a highly differentiated structure of economic output and mix of informal sector activity – which has been poorly addressed in

urban development

0

1,00,000

2,00,000

3,00,000

4,00,000

5,00,000

6,00,000

Rs

pe

r w

ork

er

Aggregate GVA per worker Estimated GVA per worker in unorganized sector

India: Informal & Formal Worker productivity (GVA per worker 2004-05)

Labour productivity of some informal sector activities are comparable with the formal sector: trade, construction, real estate, personal

services

Urban Poverty and Inequality

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Share of urban poor Share of slum population

Pe

rce

nta

ge S

har

e

Large Cities (>1million)

Small and Medium Cities

City-size wise Urban Poor and Slums

0

100

200

300

400

500

600

5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95

Rural

Caste-wise Wealth Distribution in Rural India (2002)

0

100

200

300

400

500

600

5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95

Rural

ST

SC

OBC

FC

NH

0

100

200

300

400

500

600

5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95

Urban

Caste-wise Wealth Distribution in Urban India (2002)

0

100

200

300

400

500

600

5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95

Rural

ST

SC

OBC

FC

NH

Managing India’s Urban Future2011-2031

India’s Urban Future (2011-2031)

• India will add at least 300 million new people to its cities in 30 years

• This is on top of the current urban population of ~300 million, of

whom over 70 million are poor

• In 2031, three of the ten largest megacities in the world will be in

India: Delhi, Mumbai, Kolkata

• Over 70 other cities will have a population of over 1 million

• This will be the second largest urbanisation in human history creating

huge market opportunities and development challenges

• The only option to avoid complete urban breakdown is the

simultaneous transformation of India’s cities and its villages

• The key to this the education of a new generation of changemakers

and entrepreneurs and building the capacities and motivation of

current working professionals

XI Plan Sectoral Investment Allocations (2007-12)

0

50

100

150

200

250

300

(Rs

Tho

usa

nd

Cro

res)

> 1

0 t

imes

India: the opportunity of ten simultaneous Transitions

1. Demographic transition: population stabilisation & aging

2. Health transition: infectious + lifestyle disease burden

3. Education transition: elementary secondary tertiary

4. Energy transition: oil + coal gas + renewables

5. Environmental transition: ‘brown’ + ‘grey’ + ‘green’ agendas

6. Information transition: post phone cell phone + www

7. Livelihoods transition: agrarian green + knowledge jobs

8. Economic transition: primary + secondary tertiary-led

9. Political transition: decentralised, youth and urban

10. Urban transition: rural ‘urban’

India’s Urban Development opportunity:

stylised facts & ‘speculation’

Indicator Unit 2012 2030 2040

GDP/cap (2010 prices) Lakh Rs/capita ~0.75 ~ 2.5 ~ 4.5

GDP (@ ~7% growth)crore crores 1 3.5 6.5

Urban share % 55% 70% 80%

Urban GDP lakh crores 55 231 520

∆ Urban GDP lakh crores/yr ~9 ~ 29

Urban Informal lakh crores 26 115 260

Life Expectancy years 68 75 80+

HDI 0.55 0.75 0.9

Consumption Gini 0.38 0.33 ? 0.3 ?

Carbon footprint t C/capita 1.5 2.5 ? ~ 1.5 ?

Who manages Urban India?Top Management

• MPs & MLAs 5,300

• Higher Judiciary 650

• IAS & IPS 8,200

• CXOs (top 500 corporates) ~ 5,000

• NGO leadership ~ 1,750

Total 20,900

% educated & trained in urban practice < 5%

Middle Management

• Senior Municipal officials ~ 4,000

• Senior Engineers ~ 8,000

• Urban Planners ~ 2,000

Total ~ 14,000

% educated & trained in urban practice < 20%