Tag Archives: globalization

India’s 100 Smart Cities Mission is flawed

Tokyo, Singapore, Hong Kong, Seoul, Shanghai and Beijing compete with London, Paris and New York for the top of the global city ranking. Do not take rankings like these too serious but the absence of Indian cities in the higher tiers is not startling. According to the World Health Organisation (WHO) India releases the fourth largest amount of CO2 emissions in the world and Delhi is the world’s most polluted city. Air pollution is the direct cause of 627.000 deaths annually. The dysfunctionality of the infrastructure is not limited to transport: An official study of 1,405 cities revealed that only 50% of urban areas have water supply connections and that water is supplied on an average for only three hours a day. Waste disposal and sewage treatment plants are missing in most Indian cities, 30 per cent of the households have no toilets, the coverage of the sewage network is merely 12 per cent while the treatment of sewage is even lower at 3 per cent. Most of the untreated sewage is discharged into rivers, ponds or lakes, which by-the-way are the main source of potable water.

Without mayor changes the problem will worsen every year because of the unprecedented growth of the urban population. Between 2010 and 2050 about 500 million inhabitants must be added to the urban population of 377 million nowadays.

In the meantime, India’s economy is expanding rapidly. By 2030 it is expected to have grown by five times, buoyed largely by the country’s urban centres and resulting in a growth of its labour force by 200 million workers. India’s energy demand is expected to increase three times in the coming 10 years.

The Mission

Against the background of these challenges, prime minister Modi presented a ‘Mission’ in 2015 named “Digital India” announcing the foundation of 100 smart cities across the country. This plan is envisaging making India a leader in digitally delivering a broad array of services:

  • Adequate water supply
  • Assured (green) electricity supply
  • Sanitation, including solid waste management
  • Efficient urban mobility and public transport
  • Affordable housing, especially for the poor
  • Robust IT connectivity and digitalisation
  • Good governance, especially e-Governance and citizen participation
  • Sustainable environment
  • Safety and security of citizens, particularly women, children and the elderly
  • Health
  • Education

The Mission is definitely not lacking in ambition!

Project management

A competition that took two years resulted in the selection of 107 areas where the new cities are supposed to appear. Each project is funded with $150 million spread over five consecutive years. Hiring foreign project management is mandatory. For instance, the city of Kota is collaborating with the Dutch HaskoningDHV.

Artist impression of the World trade Centre of Dholera Special Investment Region.

Taking into account the total costs of the realization of each plan, the available funds are peanuts, which necessitates the acquisition of additional sources. Options are public private partnerships, commercial bank’s lending, take out financing, infrastructure financing institutions, external commercial borrowing, and foreign direct investments.

The competence of the incumbent administrative bodies was judged to be inadequate to lead the projects. Therefore, Special Purpose Vehicles (SPV), acting under company law and headed by a CEO have evoked. The private sector might even become the biggest single shareholder of an SPV, so long as the combined shareholding of the state and local government is bigger. All rights and obligations of the municipal council with respect to the smart city project will be delegated to the SVP, including the power to collect taxes!

Artist impression of Gujarat International Financial Tech-City

A strategic turn

At first the ‘Mission’ had two strategic equally weighted components: Area-based developments and pan-city initiatives. The former are aimed at transforming existing precincts through retrofitting and renewal, and to develop new extensions to cities through greenfield developments. The latter envisage the application of appropriate smart solutions to existing city-wide infrastructure.

Reviewing the proposals which have been accepted, contrary to the original requirements, 71% of the funding will be spend on area-based development, the beneficiaries of which are about 4% of the city’s population on average and it involves less then 3% of the total area.

Under area-based development, plans have proposed redevelopment of old and creation of new central business districts, retrofitting infrastructure within these districts such as water supply, sewerage, and creation of public spaces. The proposals for the entire city, however, are limited to IT-based services like a CCTV-monitored central command system, “smart” education portals and “intelligent” water and traffic management systems and do not include investment in the infrastructure itself.

Artist impression of Vijayawada Smart City

So you’re not even going to have 100 smart cities. You’re going to have 100 smart enclaves within cities around the country, predicts Shivani Chaudhry, executive director of the The Housing and Land Rights Network

The interests behind IT-centred thinking

The direction in which the plans have evolved is unmistakably orchestrated by the bunch of IT-companies that is involved in the development of smart cities world-wide from 2006 on, when IBM started its ‘Smarter Planet’ campaign, Cisco followed with its Smart+Connected Communities initiative, Siemens launched its CityCockpit, and Microsoft presented its CityNext programme. U.S. Deputy Secretary of Commerce Bruce Andrews expressed this perfectly in his speech at the Smart Cities Summit in Mumbai: I am joined today by representatives from 18 leading American environmental technology companies, all of whom are looking for new business opportunities in India’s growing infrastructure market. Indeed, business opportunities seem abundant: The consultancy firm Frost and Sullivan estimates the global smart city market to be worth $1.56 trillion by 2020.

Cultural awareness instead of indifference

The pictures in this post are taken from glossy brochures and video’s of the plan. They reveal the direction in which the wannabe smart cities in India are supposed to develop. Let yourself be impressed for a while by the animation of Dholera Special Investment Region.

You will see fascinating architecture, futuristic transportation systems and multi-lane express ways. Not to forget, the air is blue and fresh.

Indian master architect Doshi warns that the urban vision behind the smart city proposals will destroy the informality and diversity that is the cornerstone of the country’s rural and urban society. In his view people do not have to live in multi-story towers in the age of the internet, and he rejects the necessity of expanding cities as long as adequate choices and opportunities can be generated in rural areas. I think the land pressure is actually an illusion. Why should you be close-by all the time to a million people? he asks.

Artist impression of smart Bhopal

Urban designer Rajeev Kathpalia suggests that India needs to build smart cities which respond specifically to its culture and rural networks. We have to rethink the concept of cities as centralized entities. In stead he advocates the conception of independent and self-supporting settlements at different scales, each one complete by itself or moving towards completion.

Mumbai-based urbanist Rahul Mehrotra agrees: The problem with the notion of ‘smart cities’ is that it sets up the environment to be fashioned in a single image, it’s not about cultural specificity.

Whatever problems the Mission will solve, these are not the dismal services nor the on-going growth of the population. We have to deal with the basics first, Shivani Chaudhry said. The basics are housing, employment and infrastructure and not technology as such. The Mission will not provide big public investment in expanding urban infrastructure except for enclaves where businesses and prosperous citizens are welcomed. She accentuates that Instead of trying to mitigate the effects of urbanization, the government should aim to address its causes -the agrarian crisis, rural distress, failed land reform, and forced migration.

Indian papers are critical too. They question the role of SPV’s and the curtailing of democratic control. The ‘Mission’ is a flight ahead, not only leaving the already mentioned problems unsolved, but it is unrealistic itself, as the lion’s share of the investment capital is still missing.

Artist impression of Amaravati Smart City

What would a better Mission have looked like?

Personally I believe that – in contrast to what actually happens – a pan-city approach, including a whole city and its rural fringes should have been be prioritized. The competition could have focussed better on master plans for the development of territories of let’s say 1000 – 5000 km2. These plans should have taken into account all aspects of the existing infrastructure, the expected population growth in the next decades, the options for sustainable growth and development and the cultural identity of the region. Within this master plan a handful of pilot projects could have been selected, offering a spectrum from a down-town business centres – if necessary – with 21th century high-rise buildings, to industrial areas where clean industry and housing are realized within walking distance and to small rural towns surrounded by agriculture. Delegation of power to a centralized body is probably wise, but not at cost of democratic participation. And without realistic funding any plan is a pie in the sky.

An initial experiment in ten regions might have increased the credibility of the Mission. I would have selected proposals that equally address economic challenges, infrastructural problems, and a decent life for all inhabitants as well. My winning plans will unlock the potential of the whole rural – urban continuum, promise to spread the prospective growth of the population, realize sustainable solutions, preserve environment and culture and have been developed in dialogue with inhabitants. And not to forget, they deploy the enabling potential of ITC.

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If smart cities are the solution, what was the problem?

Looking for an answer to this question[1] I found the proceedings of the symposion Beware of Smart People! Redefining the Smart City Paradigm towards Inclusive Urbanism held in Berlin on 19 – June 20, 2015[2]. This post is partly based on this report, in which I recognize many ongoing discussions.

The world’s population is growing and concentrating in cities. Needless to say that this causes major problems, especially in emerging countries. At the same time, business also concentrates in urban areas. Consequently, cities compete at world level and – inspite of all problems – position themselves as global, affluent, mundane, and smart.

The concept of a smart city refers at a loosely connected set of confluences between data, digital and other technologies, and urban proceses. The promise is of the digitally-enabled data-driven, continually sensed, responsive and integrated urban environment and a manageable entity[3]

Whether this promise will be kept is questionable: What remains to be seen, is the extend to which the smart city agenda is anything else than another instantiation of corporate power grabs, entrenching surveillance, private control over urban management and repacking neoliberalism in the dressing of seductive technologies and reimagined municipalities and citizens[4]. The modern city is a battleground of market forces, an icon of consumerism, and it is characterized by growing inequality, alienation and intolerance. Digital technologies are associated with control and power.

Naamloos3

Control center in Rio de Janeiro

Opposite to the technology-dominated image of smart cities is the concept of commoning: Citizens share, shape and maintain their living space together based on principles of share-economics and direct democracy more than on the basis of technology. Residents’ initiatives to enforce an alternative land-use at the former Tempelhof airport in Berlin are a frequently cited exemple.

Naamloos 2

Commoning at the former Berlin airport Tempelhof

Another way to frame the smart city is the perspective of urban utopia. Examples are Songdo (South Korea), Mazdar (UAE), Dholera (India) and PlanIT Valley in Portugal, who are all developed from scratch. Investors value these cities as assets in global competition, because of attractive living conditions, full-featured office space, outstanding connectivity and accessibility and high environmental standards. Residents are considered as benificiaries but in a lesser degree as active participants. In spite of the huge investments, these smart utopias rarely are a successful. In some cases they turned intp ghost cities, like Ordos in China. Songdo (South Korea) is sucessfully attracting residents from the adjacent overcrowded town of Seoul but the number of international companies remains far behind expectations. Trafic on the $ 1.4 billion,12 km long six-lane suspension bridge connecting the city to the airport is low while a fast rail link with Seoul is seriously missed.

Naamloos 5

An artists’ view of Songdo

One might wonder whether these different approaches of smart city are compatible.

I believe that the the answer is confirmatory. However, four questions must be answered in advance:

  1. What is the most desirable use of urban space, seen from a multi-actor and multi-stakeholder perspective?
  2. How can all residents maximize their participation in urban life?
  3. What mix of companies generate the most diversified sustainable employment?
  4. What is the best way to involve as many citizens as possible in decision making at all levels?

The role of data, digital facilities and other technologies must be considered in conjunction with answering these four questions. The ‘real’ smart city needs to start with the city and its attendant social problems, rather than looking immediately to smart technology for answers[5]. Proceeding this way prevents narrow technologal thinking and opens the road to low-tech or no-tech solutions. Consequently, a city can claim to be ‘really’ smart if “… investments in human and social capital and traditional (transport) and modern (ICT) communication infrastructure fuel sustainable economic growth and a high quality of life, with a wise management of natural resources, through participatory government.[6]

A special contribution during the symposium came from Gautam Bahm from India. In his opinion, the smart city does not exist; placeless concepts have no meaning. A smart city in India is something completely else than a German one. In Indian cities commoning is the norm: Big parts of cities are auto-constructed, deploying another logic than planners and architects do. However, there is a great need for a basic infrastructure: About 17% of the ground is covered with ramshackeled pipelines for water supply and sewerage. The same goes for the wires for electricity and telephone. Here is an tremendeous challenge for urban planning, which is willing to adapt the existing fabric of local communities, rather than destroying it, as is happened in China and many other places.

Naamloos 1

Commoning is the hard of many cities in India

The concept of ‘smart city’ might become an icon of a new digitally facilitated form of living in urban space. This requires a view of the city as a place that is inclusive, shared and negociated and that considers residents as active producers and contributors because of their thorough local knowledge, expertise, creativity, networking skills and entrepreneurship

This post has already been published in the Smart City Hub

[1] Free paraphrased expression of Cedric Price, architect (1933 – 2003) who wrote: “Technology is the answer, but what was the question?

[2] Find the report at https://goo.gl/cgDemx.

[3] This and the following quote are from Colin McFarlane’s contribution (p.89)

[4] Smart cities are strongly pushed by IT-companies. These companies are the main investors behing PlanIT Valley in Portugal.

[5] Robert Hollands: Critical Interventions into the Corporate Smart City Cambridge Journal of Regions, Economy and Society. Vol 8 (1) 2015, p. 61.

[6] Andrea Caragliu, Chiara del Bo en Peter Nijkamp: Smart Cities in Europe, Journal of Urban Technology, Vol 18(2), p. 652011, 70).

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Own country second, world first!

Redeeming the losers of globalization

Multinational companies[1] worldwide earned gold money in the years 1980 – 2013. In 2013 their profit after tax reached $ 7200 billion, almost 10% of the gross national product of the world. Half of the 2013 profits belong to North American and West European corporations[2]. The tremendous increase in profits is a direct consequence of globalization: The expanding global trade of goods and services at ever-lower prices, made possible by global competition, automation, offshoring, and low cost of raw materials[3].

Samenleving - olifantscurve

The question is who has benefited most from the increased wealth and who least? For many years the Serbian-American economist Branco Milanovic has focused  on answering this question[4]. He divided the world population into 10 groups for 30 consecutive years: The poorest 10%, the second-poorest 10% and so on. He calculated the change in income for each of these groups within this period. The graph below depicts the outcomes. This graph is called the elephant curve because of the eye-catching similarity with the back of an elephant.

The-Elephant-Curve

Worldwide, there are two groups of winners and two groups of losers.

The winners:

  • The richest 5% of the world, the 1% richest in particular. Half of the benefits of economic growth went to this group. Fabulously wealthy people can be found in all countries. However the majority are living in North America and West Europe.
  • The middle class within Asian countries. Its income increased about 200 to 300%. Hundreds of million people are involved, but the total monetary value of this growth is relatively limited as incomes were low.

The losers:

  • The poorest 10% of the world population. This group has gained nothing in 30 or more years. In the Republic of Congo, the average real income remained unchanged in 100 years due to corruption, self-enrichment by the rulers, natural disasters and wars.
  • The middle class in the rich countries. This group has also seen no progress in 30 years. As a matter of fact, many jobs were lost due to offshoring and automation in particular. Many people who belonged to the middle class in the end of the 20th century now have to settle for a job in the lowest paid sector. Here they enter into competition with migrants, who belong to the other group of losers.

Samenleving - wrong side of capitalism

Social democracy in Western countries has failed to notice this structural change and as a consequence its voters left for the extreme right or the extreme left. In the USA, the frustrated middle class helped Donald Trump to power and in the UK it voted for Brexit.

Policy makers in Western countries can learn from the elephant curve. Among others, the following policy measures will support the revitalization of the middle class worldwide:

  • Reduction of difference in status and income between jobs
  • Redistribution of jobs through a reduction of working hours and flexible retirement, supplemented with the option of a basic-income
  • Fair tax payment by companies, among others to co-finance the external effects of automation.
  • Realistic prices for raw materials and agricultural products for the benefit of the workers in poor countries and the farmers in rich countries
  • Supporting entrepreneurship in developing countries
  • Discouraging labour migration, among others to limit brain-drain
  • Continued support for peacekeeping in conflicts around the world, therefore strengthening UN rather then NATO.

In the long term fighting inequality is in everyone’s interest.

[1] Included are listed and unlisted companies with a turnover of at least $ 200 million. See: https://hbr.org/2015/10/the-future-and-how-to-survive-it

[2] Companies around the world still make huge profits, but the share of ‘Western countries’ has decreased as the distribution over the world of production is becoming more evenly . Further, especially in Western countries small innovative companies take over part of the production of the powerful but rather inflexible multinationals.

[3] He is from 2014 professor at New York University and was a researcher at the World Bank. For a recent interview: Humo February 8, 2017: https://blendle.com/getpremium/item/bnl-humo-20170207-132032

[4] Where necessary, he further subdivided these groups.

 

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