Smart City

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SMART CITY
If we go through the world history we had seen that 19 th century was about monarchs, 20th
century was about nation states and we can say that 21 st century will be about cities. The world
will be revolving around the mayors and we can say that the world will coming together in small
clusters. If we see the trend in population share between rural and urban areas all over the world
there had been a demographical shift from rural to urban areas. But India’s share of urban
population is only 31.1 % of the total population. But if we see the trend all over the world
whenever the urban population had touched the 30 % it had seen a steep rise in urban population.
So we can say India is somewhere at the bottom of the steep climb.
From various reports we can see that the researchers had forecasted that the population of the
urban areas will double in next 30 years. Question arises that why 30 years? This is because we
take 1 generation is equivalent to 30 years. The India’s GDP share from urban areas is about
63%. So we can say that cities are the engines of our economic growth. But for several years the
policy makers of India had always been focused on the development of the rural areas. It had
happened because the percentage of rural population had always been high. Cities didn’t get
proper attention until Jawaharlal Nehru National Urban Renewal Mission (JnNURM) came. The
service levels are also below the standard level.
For improving the urban areas capital investment of Rs. 60 lakhs crores is needed over 20 years.
It comes to Rs. 3 lakhs crores per year investment. JnNURM had given fund of on Rs. 50000
crores for 7 years.
Pillars of Smart City
Smart city is one where people want to live, work and play. The population should have an
opportunity to earn a standard livelihood and having a good quality of life. So we can say the
pillars are:
1.
2.
3.
4.

Physical Infrastructure
Social Infrastructure
Economic Infrastructure
Institutional Infrastructure

To achieve the above pillars we should have a comprehensive planning that planning should be
holistic covering every urban area sectors and efficient use of resources so that wastage and
losses could be reduced.

Transport
If cities are engines of growth then we can say transport is the wheels of the engines of growth.
India needs a capital investment of Rs. 30 lakhs crores is needed. If we go through the trend for
the registered motor vehicles over past 30 years it had rose rapidly which at present stand at 142
million. Share of public vehicles in urban areas had shifted from public vehicle to personal
vehicle due to coming of low cost vehicles in the market like that of Maruti, Hero Honda etc.
Number of cars per persons had also increased. From the global perspective we had seen that
urban road expansion does not reduce congestion. Road safety had decreased and pollution level
had increased. As use of personal vehicles had increased the fuel consumption had risen which
effecting the India’s forex reserve.
Mobility in Smart Cities
How can we make mobility smart comes the question? We can take the following steps
1.
2.
3.
4.

Use less space
Use less energy
Emit less pollutants
Cause less accidents

We can see technology does make us smart; it is only an enabler that helps us to achieve
smartness. Basically for achieving the above points we have to look into two factors.
I.
II.

Technological factors
Management factors

Technological factors are basically the work of engineers that is how to reduce fuel consumption
and making of energy efficient engines. But as an urban planner our work lies with the
management factors; that is how good we are in demand management. For analyzing demand
management we should know the pattern of how people travel and how far they travel.

Another parameter on which we are lagging behind is land use. Land use has strong lock-in
effect. This can only be solved by proper compact planning, mixed land use and efficient use of
available resource.

1. Conceptualization of Smart City
a. Green Field Cities
Smart City can either be built afresh, at a new place or location like a green field project
or existing towns can be upgraded to a Smart Cities which is primarily brownfield
project. Greenfield Smart City Projects entire infrastructure has to build from scratch,
financially more costly and would have to be located near existing employment
generating source or upcoming employment generating source will take 15-20 years to
fully develop.
b. Brown Field Cities
Brownfield Projects on the other hand require huge refurbishment and retrofitting,
financially less costly, cause hardships to citizens in transition /construction period, yet
may not meet aspirations and objectives in full. Horizontal and unplanned expansion eats
away cultivated land. Re-densifiction of land and opting for vertical growth with
reduction in horizontal growth would help reorganising congested areas and slums over a
period of time.
c. The New Town Concept as Smart Cities
Most states in India today have township policies. State governments, instead of
themselves developing land, have now started encouraging the private real estate sector
to come in and develop towns. More often than not, areas of conflict of interest would
come about. The basic motive of profit makes the realisation of the social objective
secondary. Unfortunately, most of these private sector real estate initiatives have ended
up in developments, which are too small, fragmented, in odd shapes and sizes and mostly
catering to the very high income population and far from inclusive.
d. Industrial Townships & Industrial Corridors
New Cities may be planned near a potential economic source. In past many industrial
townships as part of steel plants or large public sector undertakings have also been
developed on modern lines from scratch. Bokaro, Bhilai, Rourkela, Jamshedpur are some
of the examples. Over a period, they have been able to acquire their own identity and

have successfully provided a reasonably good quality of life to the residents where the
entire town’s administration is managed by the industry promoter (often uneasily) with
the consent of the state government.
e. Specialised Cities
Smart city could be a Medicity or an Education city or Finance City. For instance Noida
has lots of management and technical institutes and is just like a smart education city.
f. Private Cities
The concept of private cities is gradually gaining acceptance in India like those of DLF in
Delhi and Hiranandani in Mumbai, Lavasa, GIFT where the entire security, street
maintenance and administration of the estate is managed by the developers. GIFT took
finance of 70,000 cr. In 10 years, gave 5 lakh direct employments, 5 lakhs indirect
employments, supporting population of more than 20lakhs.

2. Selection Criteria
What shall be the selection criteria for building a Smart City? To begin with there is a need to
look into the character of each of proposed cities to find out the potential for the employment
generation necessary for sustenance. For example- Moradabad, it is a brassware industry,
Bombay for financial services, Bangalore for IT industries etc. Similarly industrial corridors are
potential areas where Smart Cities can be built. We may chose land which is barren so that
agricultural and fertile land is not used for urbanisation.
Some of the factors responsible for selection could be:
a. Typology - Mega Cities, Metro Cities,

2-Tier Cities,

Small Towns with Urban

Government, Census Town without Urban Government.
b. Spatial Distribution- High/ low urbanisation and Regional Balance.
c. Economic Potential- Corridor towns, towns with SEZ, ports etc.
d. Strategic Significance- All Capital cities, heritage towns.
Keeping in view the impending need, urgency and financial burden, out of 100 Smart Cities, the
Government may refurbish 60/70 of the existing Cities as Smart Cities and rest about 30 to 40
cities may be planned as New Smart Cities.

3. Planning Aspects
Efforts to improve urban infrastructure in past through various dedicated schemes have not given
desired results. For instance Jawaharlal Nehru National Urban Renewal Mission (JNNURM,
launched in December 2005) with committed central assistance of INR 467.87bn was biggest
program for urban infrastructure improvement. States and UTs could avail only part of central
assistance as they could not fulfil the conditions attached like e governance, double entry
accounting, property taxes etc.
Single coordinating and approving body, where all departments are grouped under one unified
command for swift and policy framing would help overcome difficulties usually faced in such a
large size exercise. Community feedback channel will play an important role wherein, people can
even have a look at the draft policies and post their comments.

Satellite Cities to the major town experienced difficulties in seamless mobility and created
congestions at the entry.

4. Changes in Building Bye laws and Land Acquisition Law
For achieving vertical growth, building bylaws need to be changed for increasing FAR and other
needed changes. Government need to create such public utilities and infrastructure so that citizen
can legitimately avail the service and is not forced to violate law. Law enforcement mechanism
should effectively single out wilful defaulters and misuse of facilities provided.
Improvement of service level benchmark for different utilities like power & water supply in
India from current level to 100% would require effective monitoring mechanism.
Land Acquisition Act to be relooked into: The Right to fair compensation and transparency in
land acquisition, rehabilitation and resettlement Act,2013 which become effective from
September 27, 2013 need a relook. The provisions of the Act make it difficult to acquire land for
projects like Smart Cities, It is cumbersome and time consuming. Acquisition, resettlement,
rehabilitation etc. make the process expensive. Social impact assessment and environmental
impact assessment often lead to delay and denial.
A more participative policy like land pooling may be more useful.

5. Sustainable Urban Development
Sustainability includes social sustainability, environmental sustainability and financial
sustainability.
a. Social Sustainability
Institutional infrastructure should be inclusive. It should take care of poor section of the
society, disadvantageous section of the country. Unless we do so, we can never have peace in
the country. Benefits of development should accrue to every citizen of this country and
specially those who have been marginal. We need to go out of the way to hold their hands
and to bring them to the main stream. Development of villages in the periphery of the smart
cities would be critical.
b. Environmental Sustainability
Development should not disturb ecological system. Energy Conservation is must for
sustainable development.
c. Financial & Economic Sustainability
A Smart City has to be economically vibrant. Today there is lack of good quality of labour
like- drivers, plumber, Gardner, electrician, carpenters etc. We have so many new
technologies which are not exposed to these people. They are still using the century old
practices. Skill development with the help of technology will stir sustainable economic
activity and quality of life is bound to improve. We shall be able to create an environment
which will encourage youngsters to create more enterprises, more jobs, wealth for this
country and only then we will able to bring peace and prosperity to this country.

6. Digital Connectivity
Digital mapping will be at root of entire planning for creating a smart city. Digital mapping
would be required for transport network; built up spaces; green spaces; water bodies; urban
infrastructures ; utilities like water, electricity, gas, telephone, wi-fi nodes, fire, police,
municipality, development authority, public transport - both over ground and underground; flora
( which is more than 4 inches in circumference can be mapped on the base map).
a. How will digital connectivity help?
- Efficient management of utilities
- All public services to be delivered on electronic platforms.
- Citizens would be able to submit any service request any time online whenever they get
-

time (24x7x365) and need not go to the public offices for same.
Citizens Charters shall govern response time and non-compliance penalties.
Increase lots of transparency and efficiency.
Safety and security through surveillance cameras on streets, market places, parks and
public places and connect them with other gadgets collecting the information to be shared
live with security agencies. Even connecting home cameras with the system can be made

-

possible.
Identify vacant sites for optimum use, conforming use- if the use of land or place or

-

activity is as per the plan or policy or not
From quality of life point of view, it can assimilate information for arts and culture; parks
and nature; sightseeing; sports, recreation; TV, radio and films; etc. One can know and

-

correlate which event is happening where from social/economic and security angle.
From environment point of view, you can map noise, garbage and recycling, trees, air
quality, water quality, waste water sewerage network and flow of sewage, environment
impact services, animal control and welfare. One can count number of trees and green

-

patches..
We can have specific maps like- electricity, water, sewage, land use maps-whether it is in

-

conformity or not.
GIS mapping can be used for various planning and management like housing, can
calculate property tax from an area, variation in different area can be compared, city
development, tenants records, land use management, building management and general

-

information;
Social services- mapping UIDs, old age homes, night shelters, economically weaker
sections; civic services- online citizen charter services, road mapping; fault detection in

utility network, in solid waste management- shortest route for vehicles, optimum use; city
assets management- like street light, drain; public grievance; education; health- hospital,
-

fitness centres, food catering system etc;
public safety- traffic information, fire information, disaster services, jails & juveniles;

-

evacuation routes; transport system, parking management,
Create a common platform for all the vendors to showcase their technology, processes
and products for Municipal Corporations to use.

b. Preparations Required for Making Digitally Smart City
Making Digital Base Map: Aerial photography, Reference Grid using GPS,
Photogrammetry to convert photographs into maps, Collecting data from the field
regarding all the utilities under the ground like water, sewerage etc., and create map
database. Making 2/3/4-D view of all the areas D digital maps. Such activities are
already under process in some cities like Ahmedabad, Mumbai, Hyderabad, Bangaluru,
Kolkata, and Chennai.

7. Urban Resources
a. 24 x7 Civic Amenities
Physical infrastructure-Electricity, water, sewerage, solid waste management etc. can be
provided with effective implementation of:
 Rain water harvesting
 Reduce air & water emission
 3 R ( Reduce, Recycle, Reuse) for Solid Waste Management
 Reduce CO2 emission
 Zero water discharge in industries
b. Education
Education is an important social infrastructure which is important under planning of
smart cities. It is not just our duty but it is our liability to give them quality of education
and quality of skills to grow. There is need for providing education to 100% eligible
students at primary and secondary level through combination of e-learning methods, 2-D
& 3-D education system and traditional class room education system. For higher and
specialised studies, necessary infrastructure compatible with growing need is to be
created.
c. Healthcare
Use of technology in health sector is increasing by the day. Response time for medical
intervention can be greatly be reduced. Health record of each citizen should be kept on
real time basis. Such records should be accessible globally whenever required for treating
emergencies and evacuation needs. Back office operations of hospitals, dispensaries,
medicine & consumable procurement and other management aspects need to be
integrated for better, efficient and economical dispensation.

d. Mobility
Cutting down wasteful travel time is Smart. Unless Public Transport is improved, we
cannot compete globally. Most of the cities are choked due lack of public transport
system and resultant increase of private transport vehicles. It is not widening of roads or
abundance of flyovers that will cure congestions, instead efficient public transport will do

so. Cutting down travel time, last mile connectivity, increased use of cycles and
environment friendly modes of transport are needed.
Citizens should be able to walk to the work place or to nearest public transport station. In
this way most of the people will be able to live, work and seek means of recreation within
walking distance or a Mass Rapid Transit System. Both internal as well as external
transport systems need to be

integrated with facilities like bus, train or MRT or high-

speed rail (HSR) with high density stations and terminals and supporting infrastructure
like hotels, shopping facilities, offices and residences. Integration of mobility and land
use is the pre requisite for a smart city thus increased FAR for the area to create efficient
structures would be needed.
Zones for car parking, bus stops, hawker zones, designer footpaths, green walkways,
dedicated cycle tracks for GPS monitored cycles and public plazas to form part of
stations.
High-Speed Rail (HSR): Railway Budget 2012 announced formation of High Speed Rail
Authority to run these trains. HSR will reshape the urbanisation process in the country.
The urban sprawl presently limited to 30-50 km from the city centre will change into a
300-500 km long conurbations linking central business districts of multiple cities,
forming urban economies of global scale and size.
e. Housing
Urban Housing needs vary with income levels. 70% of the urban population come from
middle class, nucleus families needing one bed room apartments.
Smart Cities to incorporate concepts like:
 Green technology
 Water neutral projects
 Direct cooling systems in buildings
 Solar power energy system
 Fire safety measures
 Disaster management

8. How to Finance 100 Smart Cities?
Clearly, the emergence of innovative technologies to help cities become smarter holds great
promise. Yet a significant challenge remains: finding ways to finance the much-needed
infrastructure upgrades. Financing smart infrastructure projects is expensive and requires
creative approaches that focus on both short-term and long-term goals.
The challenge with many of the newer smart city technologies is that would-be investors see
them as high risk because the ROI is uncertain. On the other hand, many projects that have
uncertain ROIs can be financed through traditional sources, albeit with lower levels of debt
financing. However, projects that embody some element of technology risk first-of-a-kind
projects, for instance – cannot attract debt financing and generally require guarantees or other
forms of credit support (or all equity financing). Renewable energy projects for instance are
extremely capital intensive and are front-ended with the benefits captured over the life of the
project. Without some kind of subsidy, revenues can’t cover operating costs and a return of and
on capital.
A public-private partnership may be a viable option with this sort of project.
Possible Options are:
1) Government-Based Financing Tools
2) Development Charges
3) Public-Private Partnerships
4) Private Fund Leveraging Options
5) Multilateral Funding

Financially viable capital projects play a significant role in sustainable development. Brownfield
projects to construct, retrofit, restore or upgrade capital assets such as municipal buildings, sewer
lines or local roads are both important but challenging for their capital requirement needs.

By their nature, these assets have a long expected life cycle. So the goal in financing them is to
spread the payments over the life of the asset, which requires a revenue stream to cover the
financing repayment as well as a return to investors.
Historically, public sector entities have been financing major physical infrastructure
development projects.
1. Government-based Financing Options for Smart Cities
a) Bonds:
Bonds are an important method of financing capital investment in Smart Cities. There
can be variety of bonds:
i.

General Purpose Tax free Bonds: Such bonds are typically used to finance basic
core infrastructure investments at the Municipal level. These bonds can be used
for financing new developments, raods, sewer lines, green spaces, hospital or
schools. Bonds can be raised after credit rating agencies evaluate and grade the
risk of the bonds in terms of health of the issuing corporation or public body.

ii.

Repayment will be done from the tax revenue.
Tax Free Revenue Bonds which can be serviced from the revenue generated by
the project such as parking lots or upgrading buildings energy efficient. Revenue

iii.

earned is shared as interest payment.
Industrial revenue bonds to finance a private venture as initiative to develop
industry. Repayment is by the private player and there is no state guarantee which

iv.

holds the asset as collateral until the debt is repaid.
Green bonds issued to raise capital for funding specific clean power, carbonreducing projects, reducing energy consumption in publicly owned buildings by
at say 20%, upgrading a public facility with sustainable technologies such as solar

panels, wind converters or biomass reclamation systems; upgrading private
v.

buildings
Social impact bonds, unlike conventional bonds that offer a fixed rate of return.
The return is contingent on the social outcomes agreed upon by the investor and
the issuer.

b) Linked deposit programs
i.
Energy efficiency low interest loans to individuals who want to finance capital
improvements to their homes. Homeowners wanting to save money on their electric
and gas bill by making their homes more energy efficient can apply for a green home
loan offered through the city. Anaheim (California) Public Utilities offers low-cost
financing to small businesses, some landlords and nonprofit organizations to help
imple-ment energy-efficiency measures

ii.

Property-Assessed Clean Energy Programs for financing energy efficiency and
renewable energy improvements. This program allows property owners to borrow
against their property taxes paid to fund energy efficiency improvements. In case of
non payment, any interest or penalty on an assessment would constitute a lien against
the property until paid in full

iii.

Greenhouse emissions allowance auctions where states can pool their total emission
allowances and sell them in an auction format, thus becoming a market-based entity
for regulating greenhouse gas emissions.

iv.

User fees allow ULbs to cover the cost associated with funding services and
enhancements to increase the quality of life and cover administrative cost.

c) Others
2. Development Charge from developers to pay for the infrastructure services their
developments will utilize. Conditions or financial obligations imposed on developers
help cover cost increases caused by the development.
3. Public Utility Services where developers are required to provide facilities for public use
or cash-in-lieu of these costs
4. Service Connection Charges

Utility connection fees are used to fund capital improvements and recover the cost of
integrating new development into existing infra-structure like water, gas, electricity or
sewer.
5. Bringing the Public and Private Sectors Together: PPP
i.
P3s are probably the most complicated and least understood financing tool
available to cities. PPP generally seek to balance responsibilities, risks and
ii.

rewards among all stakeholders involved.
Economic Rate of Return ( ERR) to the City is high and but IRR is usually low.
To make it attractive the Government has to bring in grants, subsidies and low
cost funds to reduce the real and perceived risks of investment.

iii.

Failure of PPP in past can be checked by making suitable amendments in current
polices. For instance


Selection criteria based on tender process gives weightage to cost rather
than technology

iv.



Scope of renegotiation



Regulatory and region specific barrier



Stringent land acquisition laws



Least cost selection creates barriers to innovation



Government apathy towards private partner



Loopholes to avoid agreement compliance



Week arbitration regime

How to induce PPP?

Pay for performance:


White Certificates, Green Certificates or Emission Trading.



Share of returns resulting from the sale of new services.



Share of returns resulting from the sale of energy produced or saved and fed into
the Smart Grid



Share of returns arising from the cost reduction of existing urban service



Efficiency returns generated by the increase in the quality and efficiency of urban
infrastructures;



Image returns: projects with strong implications of a social nature can attract the
interest of Impact Investors, for both businesses and citizens.

Summary
India is a late starter and is far more crowded and complex. Therefore India requires a far more
efficient and sustainable solution for servicing urban areas and can reap the benefits by using
technology to learn from practices from other parts of the world.

“City as a Living Organism” - Complexity of interactive systems in an organism mimic to the
complexity of a city. A nature’s Organism is self-sufficient and lives in harmony with others. We
need Cities that are self-sufficient, regenerative, vibrant, robust, that create opportunities, has
social harmony, tolerance etc… Members of such city should be physically, mentally and
emotionally healthy. Smart City is not only about hardware, roads, water supplies, electricity, or
wi-fi. A Smart City is about software that is inhabited by smart and healthy people.

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