World Bank Keen to Fund Smart Cities, AMRUT

With most of the infrastructure companies struggling to manage their debt burden, the World Bank on Thursday said it was looking to lend funds for India’s ambitious smart cities and urban development projects.

Onno Ruhl, country director, World Bank said, “We are in discussions with the government to provide some funding at the initial stages for the smart cities and Amrut programmes.”

In June, Prime Minister Narendra Modi launched three major initiatives - Smart Cities Mission, Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Housing for All (Urban) to address problems of growing urbanisation. The three ambitious schemes, which will entail an investment of over Rs 3 lakh crore in the next five years, will provide a major booster dose the real estate sector.

The government will spend Rs 48,000 crore for Smart Cities Mission and another Rs 50,000 crore for AMRUT that will cover 500 cities.

Ruhl was speaking at the launch of a World Bank report on urbanisation, titled “Leveraging Urbanisation in South Asia: Managing Spatial Transformation for Prosperity and Livability,” released by visiting World Bank Managing Director and Chief Operations Officer Sri Mulyani Indrawati.

Pitching for structural reforms and capitalising on lower fiscal deficit to stimulate demand, Ruhl said, “India’s urbanisation drive will be the biggest of its kind in the next 30 years. The government’s implementing of the 14th Finance Commission recommendations will help in devolving finances to states for the programme.”

The report says South Asia’s urban population grew by 130 million between 2000-11, and is poised to rise by almost 250 million by 2030. Terming India’s urbanisation as “messy and hidden”, the report called for steps at the policy and institutional level to tap the economic potential it offers. “Cities in South Asia are not fulfilling their potential for transforming their economies, putting enormous demands on their infrastructure, as in Mumbai which I just visited,” Indrawati said.

“Although they have made progress, India and other South Asian countries can make better utilisation of opportunities that urbanisation provides them to transform their economies to join the ranks of richer nations,” it said

The New Indian Express