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Real Estate sector needs incentives in this budget for building Smart City mission

Vanita Akhaury Jan, 18 2017 14:32:18 IST

“There is a lot to be done at the state and local government level which is outside the ambit of the central budget. Provision of adequate public transport coverage, sanitation, quick building plan approval, etc. are all subjects which need to be dealt at the local government level,” says Prof. Dr.P.S.N.Rao, Professor and Head, Department of Housing, SPA New Delhi.

“They are the 'last mile connectivity' issues in the urban sector which need to be tackled, without this, no amount of central government initiatives can bring about any meaningful change in our urban scenario,” Rao says.

Also, as there are several core elements that combine to make up the infrastructure of the Smart City mission, efficient collaboration among its different stakeholders (Public Private Partnership) could avoid time lags. The government should also come up with a firm legal framework so that multiple stakeholders are bound to work in a timely manner. Another challenge is the communication flow between the city custodians and policy drafters.

More than funding, a larger challenge during the implementation of Smart Cities Mission in India is reforming the Urban Local Bodies to make them capable of independently generating their own funding, says Shubhranshu Pani, Managing Director - Strategic Consulting, JLL India. Our suggestion to the finance minister for budget 2017-18 would be to put into practice a clear roadmap on digitisation of the ULBs and database management at the ULB’s daily activities level. Till this happens, states will have to act as guarantors for investments made by private companies.

Pani says, Infrastructure financing (via Infrastructure Investment Trusts or InvITS) is yet to take off in a big way in India. “Given the sector’s importance in the success of several priority sector areas such as affordable housing, smart cities etc., the budget should possibly announce measures to further assure investors of adequate stable policies from the mid to long term. The government also should add transit-oriented development and municipal infrastructure with similar solutions like road and rail infrastructure.”

The key to success of Smart Cities mission will be good governance and service delivery in supplying and managing urban amenities, and customisation of adaptable technology solutions to suit different economic and social environments. No technology can make the system work better if basic services don’t exist. Smart cities should be able to fulfill increasing urban needs with a long-term vision. Also, the approach should be for smart solutions.

Incetives should be more for small cities which have potential to grow compared to congested metro cities. For example as stated earlier people should be allowed to apply for bigger than 60 sqm houses under affordable housing scheme in non-metro cities to lure more people to smaller cities.

Smart Cities, Single Window Clearances, Real Estate Act: Government Initiatives for Sector