Context

• It’s an election year in India, with the world’s largest polls expected in the spring and the focus is, as usual, on farmers and rural areas and competitive pandering to both — hardly surprising in a country that considers itself a nation of villages.

Background

• This narrative, however, has one major flaw. India is, in fact, more urban than it is known or acknowledged.

• This seriously affects India’s growth prospects, leading to inefficiencies and loss of productivity in both rural and urban areas.

• What’s worse, the resulting misallocation of resources is making India’s blossoming urban areas well-nigh unlivable.

Issue

Problem of definition: What constitute an Urban area?

• The problem in India as elsewhere is largely one of definition.What constitutes a city or urban area varies widely around the world.

• Some nations employ simple population cut-offs: Mexico and Venezuela count any town with more than 2,500 residents as urban, while New Zealand uses 1,000 people.

• Since 2000, the U.S. Census has focused instead on population density (above a minimum threshold of 2,500 residents).

• China uses a density criterion of 1,500 people per square kilo-meter, but recently expanded the definition to include residents of villages that are directly connected to municipal infrastructure or that receive public services from urban municipalities.

• In India, only “statutory towns” are considered urban and have a municipal administration — a definition that officially leaves the country 26 % urban.

• State governments make the decision using widely differing criteria; demographic considerations are peripheral at times.

• The Census of India provides the only other official, and uniform, estimate. Its formula uses a mix of population, density and occupation criteria, and pegs India at 31 % urban.

• Such estimates can be misleadingly low. For instance, Kerala is statutorily only 16 % urban. Yet the census sees the well-developed southern state as approximately 48 % urban.

• If we use a population cut-off of 5,000 residents as Ghana and Lebanon do, or even Mexico’s threshold of 2,500 people, Kerala’s urban share leaps to 99 %, which is more consistent with ground reality. In effect, then, a state that’s close to 100 % urban is being governed as if it was only 16 % urban.

• This pattern plays out across many large Indian states. Using a reasonably conservative definition as Ghana does, in fact, India is already close to 50 % urban, far removed from the dominant narrative that India lives in her villages.

Implications and Challenges

• The consequences of underestimating the urban share of the population are dire.

• Resources are badly misallocated: By one estimate, over 80 % of federal government financing still goes to rural development.This reduces incentives for politicians, especially rural ones, to change the status quo.

• Tens of millions of Indians who live in dense, urban-like settlements are governed by rural governments that lack the mandate and the money to deliver basic services.

• In India, urban governments are constitutionally required to provide things such as fire departments, sewer lines, arterial roads and building codes. Local bodies in rural areas aren’t.

• Not acknowledging towns as urban also encourages haphazard and chaotic development.

• As satellite data clearly show, most cities extend well beyond their administrative limits, and dense, linear settlements spread out of those cities along transit corridors.

• This growth is unregulated and unplanned, marred by narrow roads, growing distance from major thoroughfares, limited open space and haphazardly divided plots.

Example of Kozhikode

• As the map below of growth in Kozhikode (formerly known as Calicut) between 1975 to 2014 shows, what appears to be a single economic unit is now governed by a multitude of rural and urban jurisdictions, with no mechanism to coordinate on mobility, public goods or municipal services.

• It’s difficult and expensive to retrofit such cities with proper infrastructure and services: In the areas below, road widths fall from an average of 10 meters pre-1990 to four meters in new growth areas.

Way Forward: Need for standard definition

• India is hardly the only country to face these problems, even though its size and level of development makes the challenge here particularly acute.

• The planet is over 50 % urban and continues to urbanize rapidly, almost entirely in the developing regions of Asia and Africa.

• As long as there are no standard definitions, urban-rural classifications are likely to be political, path-dependent and arbitrary.

• This will deny many countries the vital scale and agglomeration economies provided by urban areas, a necessary condition for escaping poverty.

• A universal definition would need to be flexible. Instead of imposing a simple population cut-off, governments could track population densities and offer more urban services where they are highest.

• Additionally, satellite data can be used to track the spread of development, so that city boundaries are expanded when necessary and where logical.

Conclusion

• Any attempt to create a common and well-understood urban definition will be politically fraught and contested. But such an effort is critical.

• Whether millions get to live in the equivalents of Melbourne, Tokyo or Stockholm rather than Mumbai, Lagos or Kinshasa crucially depends on these choices.