NITI Aayog released a comprehensive framework to strengthen governance in million-plus cities to unlock urban growth and achieve the Viksit Bharat dream by 2047.
About the Report: “Moving Towards Effective City Government – A Framework for Million-Plus Cities”
- The report by NITI Aayog provides a structured roadmap to reform urban governance by strengthening institutional capacity and improving service delivery in India’s largest cities.
- Objective: To transform city governments into empowered institutions capable of delivering efficient services, ensuring accountability, and driving sustainable economic growth aligned with India’s long-term development vision.
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About Million-Plus Cities in India
- Definition: Million-plus cities are urban centres with a population exceeding one million, representing large and complex administrative units requiring robust governance frameworks.
- Status in India: India currently has 47 million-plus cities, which together account for nearly one-third of the country’s urban population and contribute approximately 60% to the national GDP.
Significance of Million-Plus Cities
- Economic Growth Engines: These cities serve as primary drivers of economic activity by contributing significantly to industrial production, services, and overall GDP growth, making them central to India’s economic expansion.
- Innovation and Employment Hubs: Million-plus cities act as hubs of innovation, entrepreneurship, and employment generation by attracting investments, fostering startups, and supporting a dynamic labour market.
- Catalysts of Urbanisation: These cities play a crucial role in shaping India’s urban transition by accommodating population growth and influencing patterns of migration, infrastructure development, and economic transformation.
Key Issues in Million-Plus Cities
- Limited Devolution of Powers: Despite provisions under the 74th Constitutional Amendment Act, city governments have limited control over key functions, with effective authority over only a small fraction.
- The Amendment added the Twelfth Schedule of the assigned 18 responsibilities for the Municipality.
- Fragmented Governance and Weak Leadership: The absence of clear institutional roles between elected representatives and administrative bodies, combined with weak mayoral authority, results in fragmented decision-making and reduced accountability.
- Weak Financial Capacity: Municipal bodies suffer from inadequate own-source revenue generation, high dependence on state and central transfers, and weak implementation of State Finance Commission recommendations, limiting fiscal autonomy.
- Poor Service Delivery and Capacity Constraints: City governments face challenges in delivering essential services such as transport, water supply, and sanitation due to staff shortages, frequent administrative transfers, and limited technical capacity.
Twelfth Schedule of the Constitution of India
The following 18 functional items are placed within the purview of municipalities:
- Urban planning including town planning;
- Regulation of land use and construction of buildings;
- Planning for economic and social development;
- Roads and bridges;
- Water supply for domestic, industrial, and commercial purposes;
- Public health, sanitation, conservancy, and solid waste management;
- Fire services;
- Urban forestry, protection of the environment, and promotion of ecological aspects;
- Safeguarding the interests of weaker sections of society, including the handicapped and mentally retarded;
- Slum improvement and upgradation;
- Urban poverty alleviation;
- Provision of urban amenities and facilities such as parks, gardens, and playgrounds;
- Promotion of cultural, educational, and aesthetic aspects;
- Burials and burial grounds, cremations and cremation grounds, and electric crematoriums;
- Cattle ponds, prevention of cruelty to animals;
- Vital statistics including registration of births and deaths;
- Public amenities including street lighting, parking lots, bus stops, and public conveniences; and
- Regulation of slaughterhouses and tanneries.
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Key Recommendations by NITI Aayog
- Strengthening Urban Leadership: Introducing directly elected mayors with fixed tenure supported by a Mayor-in-Council system to ensure stable, accountable, and effective leadership at the city level.
- Integrated Service Delivery: It proposes integrating key urban services such as water supply, sanitation, and public transport under the jurisdiction of city governments to enhance coordination and efficiency.
- Enhancing Municipal Finances: Strengthening municipal finances through improved own-source revenues, timely fiscal transfers based on robust State Finance Commissions, and enabling access to municipal bonds and other market-based financing mechanisms.
- Institutional Restructuring: It suggests bringing parastatal agencies under the control of city governments with clearly defined roles to reduce fragmentation and improve governance outcomes.
- Legal and Policy Reforms: The report calls for states to amend municipal laws and for the Ministry of Housing and Urban Affairs to update the Model Municipal Law to support governance reforms and incentivise their implementation.
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Conclusion
Strengthening governance, finances, and accountability in million-plus cities is essential for making them efficient growth engines and achieving sustainable urban development in India.
1 May 2026
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