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Introduction

India’s urban population is projected to 675 million by 2035 and over 70 million new residents expected in our cities by 2045, making urban transformation a core driver of economic growth. However, this rapid change confronts structural deficits in planning, finance, governance, and environmental resilience.

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Major Challenges in India’s Urban Transformation

• Infrastructure Deficits and Service Gaps: Urban infrastructure is under severe stress due to traffic congestion, water shortages, poor sanitation, and uncollected waste.
  Eg: The Asian Development Bank estimates that India loses $22 billion annually due to transport delays and poor infrastructure.
• Weak Urban Governance and Institutional Fragmentation: Multiple agencies with overlapping functions lead to uncoordinated planning and execution. There’s limited use of digital tools and no unified accountability.
• Poor Urban-Industrial Integration: Cities often expand in isolation from economic or industrial zones, resulting in inefficient land use and urban sprawl.
• Underutilisation of Private Sector in Urban Solutions: PPPs in water, waste, and infrastructure remain underdeveloped due to high risk and limited incentives.
• Municipal Financial Stress and Limited Autonomy: Urban local bodies face fiscal deficits and lack independent revenue-generating powers, hampering investment in infrastructure and innovation.
  

Roadmap to Ensure Sustainable Urban Governance

• Treat Urban Infrastructure as Core National Infrastructure: Urban assets like transport, water, and waste systems should be integrated into national planning, similar to highways, ports or energy grids.
• Synchronise Urban Expansion with Industrial Corridors: Adopt spatially integrated models that combine transit, zoning, and economic planning to create compact and efficient urban-industrial zones.
• Create Unified, Tech-Enabled Urban Governance Bodies: Establish single-window, data-driven institutions with private sector representation and citizen participation.
  Eg:  The Bangalore Agenda Task Force exemplified collaborative, outcome-oriented urban reform.
• Prioritise Sanitation and Waste Management as Economic Drivers: Encourage BOOT and PPP models in sanitation, circular economy solutions, and decentralized waste systems.
  Eg:  Tirupur’s water PPP shows how private leadership can deliver reliable urban services.
• Recast PPP Models with New Incentives: Use instruments like Viability Gap Funding to de-risk private investments in both old and new infrastructure.
  Eg: In Budget 2025-25, Urban Challenge Fund of Rs 1 lakh crore  was announced to implement the proposals for ‘Cities as Growth Hubs’ 
• Build a Digital Backbone for Cities: Co-develop digital tools for infrastructure planning, permit automation, real-time dashboards, and AI-based decision-making to enhance transparency and efficiency.
  

Conclusion

India’s urbanisation is not just a demographic shift, but a strategic economic transition. With the right set of reforms integrating policy, technology, private capital, and citizen partnership. Indian cities can evolve into engines of national progress and global competitiveness and can become bridges to national progress.

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