Reforms are needed in the areas of land acquisition, dispute resolution, permitting processes, information availability and procurement processes to accelerate the development of smart cities, a new report has said.

According to ‘Reforms to Accelerate the Development of India’s Smart Cities’, a joint report by World Economic Forum and PwC, there are challenges limiting private sector participation in urban development projects, and institutional, business-environment and sector-specific reforms are required to enhance private participation.

Demand-supply gap “While cities in India plan to embed technology in the delivery of urban infrastructure and services, they should also plan to bridge the demand-supply gap in the provision of core urban services such as water, waste management and sanitation,” said Alice Charles, Community Lead, Infrastructure and Urban Development Industry, World Economic Forum.

While the government has introduced reforms, and the business environment has improved, more needs to be done, particularly in the areas of land acquisition, dispute resolution, permitting processes, information availability and procurement processes, the report said.

Collaboration among multiple administrative entities is necessary if smart city projects are to be completed within budget and timeframe, Neel Ratan, Management Consulting Leader, PwC India, said.

Challenges ahead Many challenges have to be addressed to create a conducive environment for urban development, the report said.

“Urban local bodies will play a crucial role in implementing the urban rejuvenation programmes, but they lack the resources to execute the programmes. Their lack of preparedness emanates from the lack of empowered leadership, inadequate institutional capacity, inadequate revenues, a lack of collaboration between multiple planning and administration bodies, and archaic processes,” it said.

Pvt sector participation According to the report, the revenue collected by ULBs in India is less than 0.9 per cent of the GDP. “The major source of revenue for urban local governments is property taxes and user charges but low charge out rates and poor compliance in their payment have led to financial dependence on the state government,” the report said.

Moreover, water, waste and sanitation have been identified as sectors least attractive for private sector participation and specific reforms are required to make them appealing.

For ULBs to function independently, the devolution of power to determine and collect user charges and local taxes, along with capacity development, are necessary. They also need to streamline internal processes by adopting e-governance and by making data-driven decisions, the report said.

Single-window systems Single-window systems that ease the permitting process will accelerate project execution, reduce cost and time overrun, and improve intra- and inter-departmental collaboration.

“For sectors that deal with physical infrastructure, reforms will be required to establish independent regulators, ensure metering, develop skilled resources, enforce collections (of user charges and taxes) from large defaulters and adopt integrated planning,” it added.

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