In India, Urban Planning a 'Blind Spot'

Shirish Sankhe cites several common denominators for successful urban policy from around the world. (2 min., 5 sec.)
Shirish Sankhe cites several common denominators for successful urban policy from around the world. (2 min., 5 sec.)

NEW YORK, October 18, 2010 - India is poised to have more than 40 percent of its population living in cities within the next 20 years, according to Shirish Sankhe, director of McKinsey & Company’s Mumbai Office. He presented the findings of a 21-month study of India’s urbanization at Asia Society New York on Monday.

Speaking with Wall Street Journal Deputy Bureau Chief Mitra Kalita, Sankhe shared several alarming "big numbers" for India’s projected urban growth over the next 20 years.  

Today, 340 million Indians live in cities. That number is expected to rise to 590 million by 2030, putting further strain on India's already underdeveloped urban infrastructure.

"The current approach will not work," said Sankhe. Under increasing population pressure, today’s Indian cities will be unable to sustain the necessary levels of economic growth to maintain a basic standard of living. At the current trajectory, Sankhe predicts major shortfalls in access to potable water, affordable housing, and transportation in Indian cities.

The McKinsey report details recommendations for five areas of reform, including funding and governance.

To support the growing population, Sankhe estimated that Indian cities will need an additional $1 trillion to fund infrastructure improvements. One underutilized fundraising approach is land monetization. According to Sankhe, in Mumbai alone the government owns $100 billion worth of land, but it has not monetized it properly.

"It isn’t a big barrier, but they just need to think it through," said Sanhke.  

But the bureaucrats who run India's cities have not made tackling the problems of urbanization a priority. Sankhe said that a switch to a mayoral system with popularly elected leaders would increase the accountability of the government, and incentivize the leadership to invest in cities.

Sanhke has already presented the results of the study to a recently formed ministerial committee in India, but he is only cautiously optimistic that they will heed the recommendations.

"There is no sense of urgency," said Sankhe, "but it’s a step in the right direction. India moves slowly."

Reported by Mollie Kirk