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REPORT 

OF 

THE NATIONAL COMMISSION 

ON 

URBANISATION 


August 1988 


VOLUME i 





Contents 


Vol.! 


Vol.ll 


Preface 

Acknowledgements 

1. Issues & Strategies 

2. Recommendations 

Part I 

1. Dimensions of Urbanisation 

2. Urban Future 

Part II 

3. Urban Pattern 

4. Spatial Planning 

Part III 

5. Urban Poverty 

6. Land as a Resource 

7. Finance 

8. Urban Management 

Part IV 

9. Planning the City 

10. Urban Form 

11. Housing 

12. Conservation 

Part V 

13. Transport 

14. Water and Sanitation 

15. Energy 



Part VI 


Vol.lll 
Voi. IV 
Vol. V 
Vol. VI 
Vol. VII 


16. People's Participation 

17. Information System 

18. Legal Framework 

Memoranda 

Working group Reports 

Research Studies Reports 

Bibliography 

Annexures 



Preface 


FUTURE historians may well decide that the crucial phenomenon of our times is the 
massive urbanisation that is engulfing the Third World. Within the span of the last two 
decades, towns and cities all over Asia, Africa and Latin America have been doubling and 
tripling in size. India, which has the second largest population in the World, is central to this 
phenomenon. 


It is indeed encouraging that, for the first time, the Government of India has appointed a 
National Commission to look into the issues. Our Interim Report was submitted to Govern¬ 
ment in January 1987. Since then, we have continued to deliberate on the broad range of 
policy interventions necessary to bring about more humane and efficient urban settle¬ 
ments, keeping in mind the urgency of generating rapid economic growth with equity and 
social justice. 


In this task, we have had the opportunity of interacting with a large number of specialists of 
eminence who have been engaged in preparing Working Group reports and research 
studies for the Commission. During our visits to the States and Union Territories, we 
obtained valuable insights into the problems of urbanisation at the grassroots, sub-state 
and state levels, through field visits and detailed discussions with the Chief Ministers, 
concerned Ministers, officials and citizens. We have also had the benefit of meetings with 
the Prime Minister, initially, when the Commission was still formulating its basic 
approaches, and later, at a stage when our ideas were taking concrete shape. 


Today, our nation is gradually beginning to realise that the process of urbaniSJiJon is much 
more than just the breakdown of Calcutta, or the overcrowding of Kanpur, or the traffic 
problems of Bombay—it is a phenomenon of unique scope and dimension, one which is 
going to change fundamentally the nature of our lives. From it will emerge the central, 
political, human and moral issues of our times, precipitated by the rising expectations of the 
millions upon millions of our people who want to find a better future. 


We hope that our recommendations will not only receive attention from Government, 
planners and administrators, but will also form the basis of wide-ranging public debate and 



discussio*', so that a broad concensus emerges on the developmental and planning issues 
it raises. Je are pleased to submit this Report in the hope that it will genCi ate this national 
debate, d.id the process clarify for Government the decisions it must take. 



Chairman 



Ashish Bose 
Manber, 



Nilay Chaudhuri 
Manber 




Fernandes 
Manber 


Cyrus Guzder 




Amit Jyoti Sen 
Manber 


Manber 


Xerxes Desai 
Member 





Member-Secretary 


Avgust 12, 1988. 



Acknowledgements 


The Commission acknowledges, with deep sense of appreciation, the enormous efforts put 
in by the working groups, research institutions and experts who have conducted studies on 
behalf of the Commission and have prepared working papers, reports and supporting 
documents. We are grateful to Shri K. Dharmarajan, IAS who took time from other duties at 
short notice to prepare a paper on “Energy". The Commission would like to place on record 
the special thanks to the National Institute of Urban Affairs, its Director, Shri Om Prakash 
Mathur and his staff not only for conducting studies on our behalf but also for very 
generously placing all the facilities of the Institute at our disposal for the compilation and 
preparation of the report properly. 


The Institute of Economic Growth, its Director, Professor T.N. Madan and the colleagues of 
Professor Ashish Bose, who have laboured in preparing the entire demographic perspec¬ 
tive of urbanisation, analysing the data and helping in the preparation of the report at 
various stages, need a special mention here. 

The Commission thanks the Registrar General, India and the Deputy Registrar General 
(Map Division) for their help and cooperation in getting the necessary data and also the 
maps. 

The National Centre of Human Settlements, Bhopal has provided the back-up facilities and 
research. The Commission thanks the centre for this work. 


The Commission is grateful to the Union Ministry of Urban Development, in particular 
Hon'ble Mrs. Mohsina Kidwai, Union Minister of Urban Development, Shri Dalbir Singh, 
Minister of State, Shri D.M. Sukthankar, the Secretary, and Shri R.L. Pardeep, Joint 
Secretary and its entire staff for extending unstinted cooperation to the Commission. We 
would like to place on record that without the help of the Ministry, our task would have 
become impossible. 


The commission also expresses its sincere gratitude to all other Ministries of the Govern¬ 
ment of India, all the State Governments and the Administrations of the Union Territories 
for their support, free sharing of the thoughts and warm hospitality. The Commission would 
like to thank the citizens, expert groups and representatives of various public, institutions 
who spent time generously in interacting with us during our tours and also assisting us by 
sending their valuable suggestions. 



The Commission places on record a deep sense of appreciation of the work done by the 
Secretariat of the Commission in providing fullest support in all aspects of the Commis¬ 
sion's work. Special mention must be made of the efforts put in by Sarva Shri M.C.Arora, 
B.R.Dhiman, R.K.Saxena, P. Sisupalan, C. Baskaran and Isaac Instone Noble Thalari, The 
Commission also places on record its thanks and appreciation to the Member Secretary, 
Shri Naresh Narad, IAS, both as a partner in the deliberations ofthe Commission and as the 
leader of the team which served us so well. 


M.N. BUCH 
Vice-Chairman 



a 

Issues and Strategies 


Over the past four decades, the number of peo¬ 
ple living in India has more than doubled—from 
350 million in 1947 to nearly 800 million today 
During the same period, our urban population 
has been growing almost twice as fast, and has 
in fact quadrupled from 50 miillion in 1947 to 
over 200 million in 1988. In just thirteen 
years, i.e. by 2001, it is expected to reach 350 
million. 

Because of the magnitude of these numbers, 
our attitude to these urban centres has been 
confused and equivocal, On the one hand we 
see them as heroic engines of growth, not only 
creating skills and wealth for the nation, but 
also generating employment for migrants from 
rural areas. From such a viewpoint, one can 
perceive India to be truly fortunate in the 
extraordinary range and diversity of her urban 
settlements: from town to city to metropolis. 
Like our farmlands, rivers and other natural 
resources, they are a crucial part of our national 
wealth 

On the other hand, these urban centres have 
also generated the most brutal and inhuman 
Mvif^ conditions, with large sections of the citi¬ 
zens (almost half in Bombay and Delhi) living in 
squatter settlef^ents. The overcrowding in the 
slums and the desperate lack of water and sani¬ 
tation leads not only to gevere health problems 
but to the abject degradation of human life. In 
this as well, India unhappily is in the forefront- 
one would have to travel far and wide to find 
conditions as reprehensible as those existing in 
our cities. In the decades to come, who knows 
how much political tension and physical vio¬ 
lence will be triggered off by the flagrant display 


of wealth which coexists with the rising expec¬ 
tations of the poor and with the appalling condi¬ 
tions of congestion and pollution which form 
their environment? 

The degradation of our urban environment must 
indeed cause alarm, but it is not, of course, the 
sum total of urbanisation. Urbanisation can also 
be perceived as a process by which the surplus 
population of workers in rural areas can resettle 
in centres where non-agricultural job opportun¬ 
ities are available. If the job opportunities are 
productive and lead to gainful employment, 
organisation becomes a catalyst for economic 
development. If, however, urbanisation is 
merely a process of transfer of rural poverty to 
an urban environment, it only results in a con¬ 
centration of misery. Depending on whether 
urbanisation is viewed and encouraged as a 
positive developmental process or not, it can be 
used either to alleviate rural poverty, and thus 
create a sound basis for national prosperity or it 
can be seen as a process of human decay. To 
emphasise its positive aspects is to seek, in at 
least four major areas, hard answers to some 
very difficult questions indeed: 

(1) In 1981 there were 160 million people 
living in urban areas; by 2001 these will 
increase to 350 million. Where will 
these people go? How will they earn a 
living? How will they be housed? Can we 
really afford the infrastructure to service 
such large conglomerations of people? 

(2) Our urban areas, particularly the metro¬ 
politan cities, are in severe crisis. Our 
planning processes have proved to be 


1 



intrinsically defective, the cities are 
overcrowded, urban land has become 
extremely scarce, services are breaking 
down, city management is often ineffec¬ 
tual and human misery has increased 
beyond belief. How can we feel that we 
have progressed as a nation when, in 
just twenty years, almost every one of 
our major cities has been reduced to a 
virtual slum? 

(3) Just as the physical infrastructure and 
administrative systems have collapsed, 
so also have the processes for raising 
resources. For whatever reason, 
resource allocation in the urban field 
seems to follow a problem rather than 
anticipate it. The compulsions of a situa¬ 
tion determine its allocation.This again 
is evidence of a system which is in 
severe crisis. 

(4) The inefficiency of our cities and towns 
is being perpetuated by obsolete, rigid 
and irrational laws, regulatory provi¬ 
sions and norms. The urban centres, 
with their concentration of diverse activ¬ 
ities, should be generators of wealth; 
instead, they have degenerated into par¬ 
asites looking elsewhere for support. 
This is a perversion of the economic sys¬ 
tem, because logically it is the urban 
markets which should trigger off pros¬ 
perity in the rural areas. Instead, the cit¬ 
ies claim that they cannot even pay for 
their own upkeep, and constantly 
hanker for subsidies. This distorts pro¬ 
foundly the basic relationship which 
should exist between the rural and the 
urban sectors of our economy. 

The task of tackling these issues is one of 
extraordinary complexity, the difficulty of which 
is further compounded by the inadequacy of the 
available data-base, and the e^ent of its scatter. 
There is no data, for instance, on the annual rate 
of delivery of new urban land to the urban land 
market, nor is there a regular flow of informa¬ 
tion on housing stocks, housing availability and 
prices. Reliable data on the costs of urbanisa¬ 
tion are hard to get. Vacant land data are notor¬ 
iously unreliable. Urban land records are often 
in hopeless disarray. The census of 1981 col¬ 
lected less information on urban issues than did 
the census of 1971. 


Should we then indefinitely postpone address¬ 
ing the issues we have posed, and which are so 
crucial to our survival, until we have collected 
the great masses of data which we think we 
might need? On the other hand, obviously the 
urban situation in India is one of deep crisis, and 
calls for measures analogous to those used 
when a house is on fire, or there is a citywide 
epidemic. The need to act becomes an overrid- 
ing imperative. And this action must be taken on 
the basis of a prima facie case, derived from the 
existing facts, past experience and human 
insight. 

Once we forge the will to act, the situation does 
not seem so discouraging. Far from it. In fact, 
having examined the crucial issues (from 
resource mobilisation and land supply policies 
to water and shelter for the poor), this Commis¬ 
sion has identified in almost every case, viable 
programmes that merit our most urgent consid¬ 
eration. What government needs to change 
above all is the lethargy that is gradually, and 
fatally, taking over. Instead, we must acknowl¬ 
edge the positive aspects of cities and the oppor¬ 
tunities which they represent. Urbanisation is a 
necessary concomitant of the development path 
we have chosen. Towns and cities, despite their 
problems, are for millions and millions of our 
people, the road to a better future. 

THE URBAN-RURAL NEXUS 

Urbanisation involves two closely related fac¬ 
tors. The first is the people-work relationship in 
rural areas, in which land is the essential 
medium—and which is right now so critically 
balanced that any addition to the population 
must inevitably push people out of agriculture 
into non-agricultural occupations. The second 
is the fact that only urban settlements can offer 
substantial non-agricultural employment, and 
absorb the migrants who are moving out of an 
agricultural economy. 

Though the process of urtj^nisation has been 
accelerated by distre%^ migration from rural 
areas, it has been accompanied by economic 
changes as well. In 19,50-51, the contribution of 
urban India to net domestic product was 29 per 
cent. This grew to 37 per cent by 1970-71. 
Given the present economic trends, it is likely tc 
increase to over 60 percent by 2001. Thus aboi 
35 per cent of the population will contribute 



over 60 per cent of the NDP. And the process is 
not an economic one alone. There are strong 
tall-outs; e.g. the development of skills and the 
diffusion of innovations, which are fostered by 
an urban milieu. 

This is not to suggest, even for an instant, that 
programmes for family planning and for agricul¬ 
tural development should not be given the high¬ 
est priority. On the contrary, for rural India to 
prosper, a number of key development pro¬ 
grammes and reforms focusing on agricultural 
and population issues will have to be first put 
into operation. However, even if we could find 
the political will to make these programmes and 
reforms operative right away, there would inev¬ 
itably be gestation period before they would 
yield results, and if during this period the villages 
are to be relieved of their surplus population, it 
must be the urban settlements with viable econo¬ 
mies to which they will have to turn. Viewed 
from this angle, urbanisation is a healthy and 
positive phenomenon, since unless urban India 
is adequately developed, the rural economy will 
collapse under sheer weight of numbers. 

In fact, in States where irrigation and the exten¬ 
sion of appropriate technology to agriculture 
has led to massive surpluses in production, the 
urban-rural nexus has actually been streng¬ 
thened, largely because of the operation of 
market forces. Thus, while migration from rural 
to urban areas is a process which seemingly 
holds out the greatest danger to our urban set¬ 
tlements, it is in fact one of vital importance for 
the development of the rural areas, and thus for 
the nation as a whole, It is from this perspective 
that the Commission has examined the crucial 
issues and conceptualised the strategic thrusts 
needed for the next few 6eca6es—without, in 
ony way, questioning or pre-empting the devel¬ 
opment and reform which must be carried out 
with the greatest urgency within rural India 
'^liself 

existing patterns and policies 

There are 3301 urban settlements in India, 
ranging in size from smalf towns to giant met¬ 
ropolises with 9 million and mere. During the 
; decade 1971-1981, these centres grew at an 
average rate of 46.2 per cent (with growth 
through migration and growth through natural 
■>rease almost equally balanced), Signifi- 
..';^tly, the big metropolitan cities have a slower 


growth rate than the medium sized towns. For 
instance, the twelve metropolitan cities (with a 
combined population of 42 million) grew by only 
29.6 per cent during the same decade. 

Estimates vary, but by 2001 India's urban popu¬ 
lation will be in the vicinity of 350 million. By 
that year, the number of cities with a population 
of more than one million each (which in 1981 
numbered 12) will have gone up to about 40. 
Hitherto urban India has been dealt with as a 
residual issue, an adjunct to rural India. Now, in 
demographic projections made for just over a 
decade hence, urban India will have become a 
reality of staggering magnitude-with the 
number of urban citizens equal to those in the 
USA and USSR combined! This nation can no 
longer afford to regard cities and towns with a 
sort of benign neglect; they need our full 
attention. 

Whilst the rate of growth of very large cities may 
have declined, the annual addition to their popu¬ 
lation in absolute numbers has been very sub¬ 
stantial. Metropolitan cities such as Bombay, 
Delhi and Bangalore grow each year by over 
300,000 people, i.e,, the equivalent of what has 
been classified in this Report as an independent 
C 1 city (see box on page 23.) Thus, while one 
might draw some slight comfort from the 
decline in their rate of growth, the addition of 
such colossal numbers to these cities neverthe¬ 
less exerts enormous pressure on their already 
over-strained physical and social infrastructure 
- not to mention their capacity to generate addi¬ 
tional employment. The result: these cities have 
neither been able to upgrade their infrastruc¬ 
ture, nor to add adequately to employment capa¬ 
bility in order to cope with the additional 
population. 

So far, at the national level, the problems of 
these cities have been treated in an ad hoc 
manner. Programmes such as lUDP (Integrated 
Urban Development Programme) and IDSMT 
(Integrated Development of Small and Medium 
Toyvns) have emerged from time to time and, 
without being allowed to run their course, have 
been abandoned at the end of a particular Plan 
period. The fallacious premise that urbanisation 
is synonymous with industrialisation has 
resulted in attempts to create towns around 
new industries in wilderness areas, where 
neither the infrastructure nor the available nat¬ 
ural resources permit sustained growth. The 


3 



Commission therefore is of the opinion that ad 
hoc policies relating to urbanisation and urban 
development need to be replaced by a consist¬ 
ent, logical, systematic policy which can be sus¬ 
tained over a period of time. 

INTERVENTIONS 

In the Commission’s view, a programme of 
explicit state interventions is necessary to direct 
and modify the course of urbanisation in future. 
The broad guidelines for such a programme, 
both at the central and state level, should be a 
mix of positive development and preventive con¬ 
trol. A large number of medium and small towns 
will have to be given the necessary impetus by 
way of investment, particularly investment in 
infrastructure, so that they develop in a desira¬ 
ble manner. Control of land -use is not enough; a 
whole range of policy instruments such as the 
supply of electricity, water, transport, etc. have 
to be considered, including pricing policies for 
these services. 

There is indeed a wide spectrum of urbanisation 
conditions in the 422 districts of this nation, 
ranging from those which are 100 per cent 
urban to which are 100 per cent rural. 
Choosing 30 per cent urban as the cut-off point 
(as compared to the national average of 23.7 per 
cent), we have identified 58 districts where the 
urban population has already crossed this level. 
The Commission strongly recommends that the 
necessary back-up be given to these districts in 
order to increase their rate of urbanisation and 
thus generate more employment and economic 
growth. 

At the other extreme, we have the rural districts, 
i.e., the 109 districts where the rural population 
is over 90 per cent of the total population. Most 
of these districts are poor and backward and 
these are precisely the districts which have the 
highest potential for migration to the urban 
areas. Since the recommended policy is to 
reduce the flow of migrants to the bigger cities, 
viable strategies must be conceptualised for 
these rural districts to develop. Appropriate 
investments have to be made to generate 
employment and economic growth not only in 
agriculture but also in trade and commerce, 
administration, the tertiary sector (particularly 
in health and education), and of course, to the 
extent possible, in the development of small 
industries. To minimise any element of ad hocism 


and arbitrariness, we have recommended 
the development of the headquarters of such 
rural districts in this manner. These of course 
are broad guidelines, and while working out 
concrete programmes for urban development, 
deviations may have to be made in some cases 
from this general rule of supporting headquar¬ 
ters. However, the Commission wishes to 
emphasise that these strategies for develop¬ 
ment of the rural districts are totally different 
from the present policy of encouraging industry 
to locate in 'backward' areas, and that propping 
up backward no-industry districts by giving 
incentives to entrepreneurs will not by itself 
help either the process of viable industrialisa¬ 
tion or of rural development. 

It will be seen that the intervention strategies 
proposed range from giving the necessary back¬ 
up to districts which have already reached a 
relatively advanced stage of industrialisation 
and urbanisation, to providing input in districts 
where urbanisation is low and migration is high. 
These urbanisation strategies thus become 
direct inputs for rural development and for pov¬ 
erty alleviation at the district level. They have 
their genesis in a philosophy of using urbanisa¬ 
tion as a positive and beneficial force based on 
the premise that cities and towns should be 
engines of economic growth. During the British 
rule, only a few metropolitan cities were 'thea¬ 
tres of capital accumulation'; what we need 
today is the diffusion of economic activity in a 
manner that will generate economic growth 
with equity, constantly keeping in view the 
larger objective of balanced national 
development. 

In the historic process of urbanisation through¬ 
out history, the development of administrative 
nerve-centres have always played a crucial role. 
But it is not enough to develop and sustain New 
Delhi as the capital of India: all the State capitals 
deserve equal attention. Our urbanisation strf^- 
tegy must reflect the concern for all Siicfi cities 
and towns (regardless of population size) and 
the Five Year Plans should provide adequate 
support for this. Sim.iiarly, infrastructural sup¬ 
port should be given to large industrial cities (old 
and new), port Cities and other industry-specific 
cities, so that their economic bases are consoli¬ 
dated, strengthened and expanded. 

Keeping these guidelines in mind, and using 



various statistical criteria, we have made a preli¬ 
minary list of about 600 cities and towns. Bar¬ 
ring some of the headquarters of rural districts, 
most of these cities recorded high rates of popu¬ 
lation growth and expanding economic activity. 
These GEMs (Generators of Economic Momen¬ 
tum) were further screened from the point of 
view of physical location, availability of water, 
energy and transportation, and a final list of 329 
GEMs was prepared Based on this configura¬ 
tion of GEMs, 49 priority urbanisation regions 
throughout the country were delineated, taking 
into account the 15 Agro-climatic Regions 
recently defined by the Planning Commission 
and the 80 natural regions used by the National 
Sample Survey Organisation. These 49 SPURs 
(Spatial Priority Urbanisation Regions) are of 
varying sizes and shapes, and cut across state 
boundaries. For urbanisation to play a major 
role in the development process, the Planning 
Commission and the State Governments 
should view urbanisation in the total develop¬ 
mental context and allocate resources which 
will ensure optimum utilisation of the natural 
and human resources within each of these 
SPURS. 

For decades now, the rate of urban growth has 
followed the pattern of investment, particularly 
so in the Third World. It is precisely because we 
will not invest in a city such as Gwalior that 
Delhi still continues to grow; it is because 
Warangal is left undeveloped that Hyderabad is 
bursting at the seams; it is because Katihar and 
Champaran are allowed to decay that people 
from Bihar will migrate to Calcutta or Bombay 
rather than stay nearer home. The Commission, 
therefore, has recommended that any future 
strategy for urbanisation in India must ensure 
adequate investment in the selected growth 
centres and regions so that, over a period of 
time, they develop to a level capable of self- 
sustaining economic growth and offer avenues 
of employment and earning to the surplus popu¬ 
lation of not only the surrounding villages but 
also the nearby towns which are stagnating. 
Somewhere betweert Rs. 3,000 and 3,500 
crores will need to be invested per year in infras¬ 
tructure in order to achieve such growth 
momentum. A great deal of initial financing 
would have to be provided, but as economic 
activities develop and towns grow, they will be 
expected to repay the invested amounts. When 
compared with the ad hoc expenditure now 


incurred just to keep the older large cities alive, 
investment of this relatively small amount in our 
urban future would be more than justified. The 
crucial difference in applying resources in the 
manner proposed is that they would anticipate 
the future rather than merely follow a trail of 
disaster resulting from passive neglect. 

In achieving these objectives, power availability 
could be used as an instrument for establishing 
preferred patterns of growth. Business activity 
is attracted to places where power availability is 
reasonably certain - which is why an industry 
would rather locate, even illegally, in Delhi 
where it has power for 24 hours of the day, 
rather than at Sonepat or Panipat where it 
would be fortunate if there was power for even 
12 hours a day. One of the reasons for the rapid 
growth of Bangalore was the easy power supply 
position, which attracted many large-scale 
industries to that metropolis. If two decades 
ago, power had been made available by the Kar¬ 
nataka Government at places other than Banga¬ 
lore, the urban picture would have been altered 
decisively in that State. This point is empha¬ 
sised because it is not as if leverages are not 
available to Government for influencing the 
locational decisions of industry, including the 
private sector. Whilst cautioning against the 
irrational use of government leverage to force 
development into areas which have no growth 
potential, the Commission feels that, once the 
centres have been rationally identified, access 
to energy should certainly be one of the instru¬ 
ments used to direct development to these 
locations. 

The Commission is confident that, if sufficient 
investment is made in the GEMs and SPURs 
identified, then, by the end of the Ninth Plan, the 
urban settlement pattern in India would have 
substantially changed and the imbalances of 
the present metro-dominated urban system 
would be greatly reduced. However, this does 
not mean that our larger cities and towns, 
which contribute so much to national wealth, 
should be neglected. Today we have a stop-go 
approach to these centres, with a holding back 
of development inputs till such time as a crisis 
forces makeshift decisions on us. The slums of 
Bombay and the major breakdowns of Calcut¬ 
ta's physical infrastructure require more than 
ad hoc decisions to make Rs 100 crores availa¬ 
ble to one city and Rs 150 crores to another. 


5 



What precisely is wrong with our large cities 
and towns? What has caused their decay? Why 
is there inadequate access to land for housing? 
Why are the civic bodies virtually insolvent? 
Why is poverty so patently visible in urban cen- 
tres which have such a vast potential for gener¬ 
ating wealth? In the answers to these questions 
lies their future. The Commission has 
approached these problems from many angles, 
including organisational structure, policies 
related to urban form and planning, industrial 
location, land, access to funds, housing, infras¬ 
tructure, conservation, and the regulatory provi¬ 
sions of laws and rules, 

THE HUMAN FACE OF CITIES 

We have spoken much of urban patterns and 
spatial planning; it istime we turn our attention 
to the people who inhabit our towns and cities. 
And here, without any doubt, that which is most 
clearly apparent (and which causes the greatest 
anguish) is the starkly visible poverty we see 
around us. It is, arguably, the worst pollution of 
all—manifest in the slums which dominate the 
townscape, and in the mass of beggars, petty 
hawkers and casual workers struggling to eke 
out a living. The cities have wealth, but the poor 
who live in them do not share in it. They service 
the city, they clean the houses of the rich and 
cook for them, they provide labour for factories 
and shops, they are the main carriers of goods, 
and yet they continue to be poor. The transfer¬ 
ence of poverty from a rural environment, 
where it is well spread out over space, to a city 
where it is concentrated, presents perhaps the 
most horrifying images of independent India. 

Little is being done for the urban poor. They do 
not have access to land for housing at a cost 
which they can afford, nor are they provided 
with any civic amenities. They are not helped to 
acquire work-sites to establish their small busi¬ 
nesses. They are accepted in the city only as a 
necessary evil without which the city would not 
function. The planning system has no place for 
them because the master plans aim at the crea¬ 
tion of regulated and zoned settlements of an 
unaffordable nature. For the poor, there is really 
nothing. From time to time, political solutions 
are attempted, such as granting pattas to people 
who have already helped themselves to land 
and who, even without the pattas, would man¬ 
age to survive on it. 


The Commission recognises that the Indian city 
of today and for some time to come, will have 
almost a third of its population living below the 
poverty line. For them, the State must organise 
both land for housing and work-sites. Theii 
employment obviously cannot be only in the 
organised secondary (i.e. manufacturing) sec¬ 
tor. More and more manufacuturing is now 
being done in highly capital-intensive indus¬ 
tries, and the tertiary sector is so heavily domi¬ 
nated by informal activities that it is not directly 
dependent on formal manufacture. In fact, 
much business in urban India tends to be in the 
informal sector, which provides about 45 per 
cent of the total employment. 

Therefore, if the problem of urban poverty is to 
be tackled, there will have to be a nexus 
between investment and employment. This 
does not mean that such employment should be 
unproductive, as is often the case in relief 
works. The informal sector is productive and 
what it needs to become more viable is adminis¬ 
trative, financial and marketing support. There 
is truth in the tautological statement that the poor 
are poor because they do not earn enough. The 
Commission is of the opinion that, with the 
proper type of support, informal, small-scale bus¬ 
iness can flourish and help the poor to earn 
more. This support can be in the form of train¬ 
ing, organisation for the purpose of marketing, 
administrative support by provision of work¬ 
sites, some basic infrastructure and financial 
support by loans which can help a small busi¬ 
ness to establish itself. For this purpose, the 
Commission has recommended the setting up 
of an Urban Small Businesses Development 
Bank. 

The Commission understands, of course, the 
danger of such aid programmes (which are ana¬ 
logous of those already available to the rural 
poor) becoming incentives for increasing migra¬ 
tion into our towns and cities. The Commission 
is aware that any such programme could result 
in accelerating the migration of the poor to big 
cities, and thus, become counter-productive. On 
the other hand, if no'tning is done to tackle the 
present dismal situation in these cities, there 
will be a virtual collapse of the urban system. 
Therefore, a judicious policy of selective pro¬ 
grammes of providing relief to the poor should 
be deployed in a manner which encourages the 
growth of smaller urban settlements. 


6 



If the preponderance of the poor is taken as the 
concern on which urban planning should focus, 
the physical planning of our cities must change 
dramatically. The poor cannot afford the time or 
the money to travel long distances to reach their 
places of work. Therefore, work and residential 
areas must develop in close proximity to each 
other. This would change the shape of cities 
because the need to commute would be drasti¬ 
cally reduced. People could just walk or cycle to 
work, which would alter the road pattern and 
reduce dependence on public transport. 
Because the poor cannot afford expensive struc¬ 
tures for housing, they would naturally con¬ 
struct low-rise buildings. If this becomes the 
basis of urban form, then we could move 
towards a low-rise, high-density configuration 
of our cities - which would encourage self-help, 
incremental housing and reduce the high 
energy requirement endemic in high-rise build¬ 
ings. What is more, because low-rise construc¬ 
tion is labour-intensive, by designing cities in 
which the poor are equal partners, these cities 
would not only be pleasant to live in and far 
more economical to service, but would also 
have a built-form which would generate much 
more employment just where it is most needed- 
viz. among the semi-skilled and unskilled 
migrants who are moving to the urban centres. 

If this low-rise, high-density pattern takes the 
forms recommended in the chapter on Urban 
Form, then it would have the crucial advantage 
of constituting the first giant step towards urban 
EQUITY. This is an issue which is increasingly 
going to move to centre-stage as the next two 
decades unfold. The grotesque disparity which 
now prevails in our cities (Tell me how much 
urban space you command and I 'll tell you who 
you are'.) cannot continue to prevail. For many 
migrants, cities represent not only economic 
opportunities unavi^ilable in the villages, but 
new psychological ana physical freedoms as 
well. The Indian city is a melting pot. For land¬ 
less labour, harijans and adivasis these cities 
provide the opportunities which are enshrined 
in our Constitution, but which our villages so 
brazenly, and so viciousiy. deny them. For these 
millions upon millions, our urban centres will 
continue to be havens of hope, where they can 
forge a new future. 

EMPLOYMENT 

The structural changes in the economy are very 


slowly being reflected in the composition of the 
work force. The primary sector's share in the 
total work-force was 72.6 per cent in 1951, and 
this share declined only marginally to about 69 
per cent by 1981. Even by 2001, this proportion 
will still be as high as 65 per cent. This is clearly 
indicative of the tendency of the secondary and 
tertiary sectors not to absorb labour commensu¬ 
rate with their rising outputs, particularly in the 
formal sector-which is partly on account of ris¬ 
ing labour productivity in a context of rapid tech¬ 
nological change. 

The inability of the primary sector to sustain any 
further burden of increasing labour, the unwil¬ 
lingness of the secondary and tertiary sectors to 
absorb additional labour in the formal sector, 
and the distinctly higher incomes of non- 
agricultural pursuits in urban areas have given 
rise to rural-urban migration and the pheno¬ 
menon of growing informal sector employment 
in urban areas. The proportion of informal sec¬ 
tor employment in some of the cities has been 
estimated to be over 50 per cent. Given the 
dimensions of economic change and population 
growth anticipated over the next decade and a 
half, generating employment in urban areas 
assumes critical importance. In 1981, 28 per 
cent of the urban work force was in manufac¬ 
turing activity, 18.7 per cent was in trade, 7.8 
per cent was in transport, communication and 
storage, and 25.2 per cent was in other activi¬ 
ties. It is estimated that these proportions, in the 
absence of meaningful interventions, are 
unlikely to change in the next fifteen years. 

In the interest of more equitable distribution of 
income, it is necessary to pursue policies that 
induce a higher degree of labour participation in 
the formal sector and remove unwarranted res¬ 
trictions on the growth of this sector. The Com¬ 
mission therefore recommends the following; 

(a) The current Industrial Location Policy 
should be expanded to provide incen¬ 
tives for labour absorption. 

(b) The zoning and town planning regula¬ 
tions currently adopted encourage 
multi-storey and high-rise buildings 
which use a technology that has a rela¬ 
tively low labour component. Low-rise, 
high-density urban form would entail a 
construction technology which provides 


7 



employment to significantly larger 
number of persons. 

(c) The zoning and land-use restrictions 
which come in the way of informal and 
household economic activities should 
be suitably modified to facilitate a 
broader economic base for urban areas. 

(d) Training for and financing of self- 
employment (referred to in the Poverty, 
Alleviation programme) should be 
stepped up. 

LAND SUPPLY 

Possibly the most disastrous feature of the past 
four decades of urbanisation in India has been 
our tragic failure to anticipate the rising demand 
for urban land, and thus be able to ensure an 
adequate supply at affordable prices. In this the 
worst sufferers have, of course, been the urban 
poor. 

By urbanised land we mean land which has 
been developed for urban application by, firstly, 
having access to Jobs (crucial to the survival of 
the poor) and secondly, by the provision of 
infrastructural facilities such as roads, water, 
sewerage, power, transportation and other 
municipal services. A sufficient supply of such 
land, on a scale commensurate with demand, is 
essential. And yet in our cities and towns there 
has been no systematic and established method 
either for its creation or for its delivery to those 
who need it. The growth rate of India's urban 
population has never been matched by approp¬ 
riate interventions to ensure the production of 
urban land at the right time, place and price. 

The results have been catastrophic. Land has 
become an extremely scarce and expensive 
commodity, with a fatal mismatch between peo¬ 
ple's incomes and land prices. Households sav¬ 
ings have had to be diverted from other critical 
uses to meet the most modest shelter needs. 
Within the urban sector itself, household funds 
which could have flowed into paying for a range 
of urban services, such as water and sewerage 
and transportation, have been pre-empted by 
grossly over-priced land. As a result, the provi¬ 
sion of these services has itself greatly suffered. 

This criopling shortage of land forced many of 
our citizens, both sellers and buyers, into a dis¬ 


respect for the law. Black money has prolifer¬ 
ated, corruption has become rife and moral 
values have been severely eroded. The country 
is paying a very heavy price indeed for urban 
land. 

Inevitably, the poor have been affected most of 
all. With legal, institutionalised and simplified 
access to urban land at affordable prices effec¬ 
tively denied to them, they have had to take 
recourse to the only option available - illegal 
occupation of land. These squatter colonies are 
an organised response necessitated by an oth¬ 
erwise impossible situation (and perhaps are 
less reprehensible than the illegal floor space 
violations by the economically more fortunate). 
The typical response to such occupation is, of 
course, to deny access to basic municipal servi¬ 
ces, The result is that the brutal mismatch 
between income and land price is followed by 
the most brutish abuses of human dignity. 

How are we to respond to this situation? How 
are shortages to be overcome and urban land 
prices brought dramatically down? The Com¬ 
mission wishes to recommend, with all the 
emphasis at its command, a realistic and clear- 
cut land policy, as follows. 

1 The annual demand for additional urba¬ 
nised land in each town and city must be 
realistically estimated for different uses 
and at different locations. Without such 
data it is difficult to conceive even the 
first move. 

2. Positive intervention must be initiated to 
generate new urbanised land on a suffi¬ 
cient scale by extending municipal servi¬ 
ces and (most importantly) providing 
access to Jobs in these new areas. This 
last is crucial for two decisive reasons. 
Firstly, the poor are not coming to cities 
for housing—but for work. And 
secondly, the deployment of work places 
in these new areas helps initiate the 
cash flow that is needed to cover the 
cost of the infrastI ucture. In this, the role 
of government is pivotal. As the prime 
actor on the scene, it must conceptua¬ 
lise the new directions of growth and, by 
its own participation, take responsibility 
for initiating the process. By deploying 
some of its functions (both governmen¬ 
tal departments as well as certain semi- 



governmental agencies) to open up a 
new area, it compels others (industry, 
offices, small businesses, etc.) to follow 
—thus generating the increased land 
values that can be used to subsidise the 
development costs. 

3. Furthermore, since every government 
job moved has a multiplier of about 5 
other jobs, transferring 20,000 govern¬ 
ment employees from Bombay to, say, 
New Bombay would deploy a total of 
120,000 jobs (which, with families, 
would mean over half a million people) 
in the new growth centre. Thus, at one 
stroke, not only would a critical mass be 
achieved in New Bombay, but a great 
deal of pressure would also be taken off 
the old city. The decisive importance of 
governmental action- and responsibility- 
in this process cannot be emphasised 
enough. 

4. The hoarding of vacant land must be 
strongly discouraged and land forced 
into the market through fiscal mecha¬ 
nisms. Vacant and under-utilised land 
must be taxed. In fact, there is a case for 
taxing such land as if it were fully deve¬ 
loped, or perhaps at an even higher rate, 
as a penalty for non-development of an 
asset valuable to society. 

5. Legislative devices can be used to com¬ 
pel the development of vacant lands for 
designated purposes such as housing 
for the low and middle income groups. 
The mandatory development of vacant 
lands for specified purposes within 
clearly defined time limits should be 
applicable not only to private owners but 
also to government owned lands. 

6. Land which has fallen into disuse (or 
inefficient use) through the passage of 
time, must not be so locked up but 
should be recycled for other, more effi¬ 
cient uses, responding to changing 
times. For instance, significant parts of 
our cities are occupied by industries 
which for years have been in a state of 
decline, some terminally so. We need to 
accept that factories-like human beings 
- are mortal. They too have life spans. 


There comes a time when technology 
will render an industry redundant or 
obsolete. When that happens, prefera¬ 
bly before the consequences are felt, 
land must be allowed to be recycled to 
meet other more current needs, 

7. Unauthorised and illegal occupation of 
land needed for city growth and the pro¬ 
vision of infrastructural services must 
be dealt with in the larger public interest 
(though with humanity and 
understanding). 

8 The laws and regulations pertaining to 
property development, sale and mort¬ 
gage need to be modified to remove 
cumbersome and dilatory procedures, 
simplify transactions and encourage an 
active land market. 

9. Lastly, the data base on urban and 
urbanisable land needs to be greatly 
improved, including the adoption of 
modern cartographic methods, mainte¬ 
nance of well-documented and well- 
demarcated records of ownership 
rights, and the creation of suitable 
machinery for generating and maintain¬ 
ing land records. 

Above all, there must be the realisation that 
urbanised land is a vital resource that needs to 
be generated in sufficient quantities for approp¬ 
riate uses. Only thus can we ensure the viability 
of our cities. The present imbalance between 
incomes and land prices cannot be allowed to 
continue because of the damage it is causing to 
the urbanisation of India, to the welfare of its 
citizens, and to the moral standards of this 
nation. 

FINANCING URBANISATION 

At the centre of the problem of urbanisation is 
the paucity of the funds needed for the creation 
and management of our cities and towns 
Almost without exception, our urbtin settle¬ 
ments are characterised by highly restricted 
access to capital funding, and municipal 
incomes are inadequate for coping with the 
expenditure levels required for an acceptable 
urban environment. It cannot be denied that, if 
we are unable to mobilise greater resources for 
urban development, we cannot expect a signifi¬ 
cant change in our cities. 


9 



The citizens of our cities and towns, howeve , 
need to realise that if they want a better urban 
environment they must be prepared to pay for it. 
The funds for urban development must come 
from industry, trade and commerce, from all the 
institutions which derive economic benefit 
through their location in urban settlements, and 
from the people who live in them. Cities must 
pave their way to a better urban environment. 
Tax collection needs to be made vastly more 
efficient and evasion severely penalised. Prop¬ 
erty taxes have to be brought in line with exist¬ 
ing realities and made simple enough to levy 
and adjusted periodically. Governments and 
their agencies should pay the property taxes 
from which they are exempted today—such 
exemptions belong to a bygone, colonial era. If 
and when octroi is replaced, it should be by a tax 
or taxes which are controlled by the local body. 
Professional taxes could become a major source 
of municipal revenue, for which purpose Article 
276 (2) of the Constitution would need to be 
amended. Betterment taxes should be resorted 
to for raising revenues for the beneficiaries of 
developmental programmes. 

Vacant or underdeveloped land must be 
brought within the tax net, Charges for services 
such as water, power, sewerage and transport 
should be based on full-cost recovery and with a 
slab system, wherever possible, which puts a 
heavier burden on the bigger consumers. There 
is scope for introducing a hierarchy of such ser¬ 
vices, qualitatively differentiated and therefore 
differently priced, the pricing mechanism pro¬ 
viding for an element of cross subsidy from the 
rich to the poor. 

State Governments too have been remiss in 
ploughing back into urban settlements a fair 
share of the revenues which they derive from 
them. While Articles 280 and 281 of the Consti¬ 
tution provide for the creation of Finance Com¬ 
missions to determine the sharing of revenues 
between the Central and State Governments, 
there is no such provision governing the rela¬ 
tions between State and City governments. It is 
recommended that Finance Commission be 
appointed by each State to decide on the alloca¬ 
tion among city governments of revenues 
derived by the State from urban settlements, 
and that the Constitution be amended for this 
purpose. Municipal plans also need to be incor¬ 
porated in the State and National Planning pro¬ 


cesses and form an integral part of the country's 
Five Year Plans. 

The Central Government has been equally 
remiss. Substantial amounts are collected from 
cities and towns by way of direct and indirect 
taxes and some of this money must flow 
back. The Seventh Plan allocation for urban 
housing, water supply, sewerage, etc. is 4 per 
cent of which the Central Government's share 
is 0.25 per cent. These figures are woefully low. 
It is recommended that plan allocations for the 
urban sector should be at least 8 per cent and at 
least one half of this amount should be contrib¬ 
uted by the Central Government. The Central 
Government also needs to show great restraint 
in taxing elements of the urban infrasturcture, 
particularly housing and transportation, 
whether it be by way of excise duties on goods, 
capital gains and wealth taxes, or taxation of 
incomes from house property. Equally, State 
Governments need to show restraint in the 
imposition of sales taxes which would increase 
the costs of urban living, especially in the areas 
of housing materials and transportation. 

Specialised finance institutions need to be 
created for the funding of the urban sector. This 
is necessary not only in order to create reliable 
channels for funding but also to ensure that 
funds are equitably allocated among the towns 
and cities of India, that the money is wisely and 
prudently spent and that the borrowers make 
financially satisfactory arrangements for the 
repayment of loans, payment of interest, depre¬ 
ciation of assets and for meeting operating 
expenses. The three main banking institutions 
recommended to be set up during the Eighth 
Plan are the National Metropolitian Develop¬ 
ment Bank and the National Urban Infrastruc¬ 
ture Development Bank, each with an equity 
base of Rs 250 crores, and the Urban Small 
Businesses Development Bank with an equity 
of Rs 100 crores. At the same time, the equity of 
the National Housing Bank should be raised 
from the proposed Rs 50 crores to Rs 200 
crores. The Central Government, State Govern¬ 
ments and the Banking Sector should share the 
equity in the ratio 50:30:20. These apex banks 
would be involved largely in the refinancing of 
funding by affiliated institutions at State, Dis¬ 
trict and City levels, establishing these bodies, 
setting organisational objectives and perfor¬ 
mance standards, and, generally, in playing a 
coordinating, developmental and catalytic role. 


10 



One of the most important functions of these 
institutions would be to force local bodies to 
move away from a situation of dependence on 
exchequer funding for capital expenditure and 
to prepare viable, feasible projects of urban 
development which the financial institutions 
could fund. Built into each proposal would be a 
scheme for improving the resource base of the 
local body concerned so that the debt could be 
adequately serviced. Since the loan would be 
specifically project-tied and would be monitored 
by a hard-headed financial institution, the local 
body would be obliged to spend the money 
wisely and within the prescribed time limit. A 
major advantage of this would be that, if the 
charges, fees, rates or taxes directly linked with 
the service are raised, there would be less res¬ 
istance than now because improved service 
would be available to the citizens. Today, every 
proposal to raise rates is resisted because it is 
not linked with any improvement in the servi¬ 
ces. To the extent that the financial institutions 
bring discipline to the municipal scene, there 
would be improvement in municipal administra¬ 
tion, Undoubtedly the less-efficient local bodies 
would not benefit from this source of funding, 
but these could be singled out and helped to 
improve their management systems. 

The urban sector has been grossly neglected so 
far and the allocations to it have been far from 
rationally determined. Furthermore, it is a tragic 
mistake to look upon investments in the crea¬ 
tion of cities and their maintenance as welfare 
measures. Cities are complex economic and 
work entities, macro-organisms that produce a 
variety of goods and skills and services. Invest¬ 
ments in the urban infrastructure are not wel¬ 
fare acts; they are crucial investments in the 
basic infrastructure required for economic 
growth. These investments pay back dividends 
to society. Cities must be seen as key elements 
in the economic infrastructure of this country 
and we will have to make investments in them 
in accordance with these perceptions. 

MANAGING OUR TOWNS AND CITIES 

The present organisational structure of our 
towns and cities is based on municipal systems 
which originated in the British days (as a substi¬ 
tute for democracy at national and state levels). 
They were best suited to the administration of 
compact, homogeneous towns. The pace of 
urban gorwth was then leisurely and predicta¬ 


ble and, therefore, a municipality could manage 
a town fairly competently. However, Independ¬ 
ence brought in a new dynamics to develop¬ 
ment in these urban centres. The influx of 
refugees after Partition caused many cities to 
increase exponentially in size and population. 

Then again, the development thrust in the econ¬ 
omy, with a greater emphasis on non- 
agricultural, especially industrial, activities also 
brought about remarkable changes on the 
urban scene. All these factors have resulted in 
municipal administration becoming increas¬ 
ingly incapable of coping with new demands. 
Instead of strengthening the municipalities, 
State governments have often reacted by creat¬ 
ing new agencies and authorities, s'ich as Spe¬ 
cial Planning Bodies and Development 
Authorities, to undertake urban government 
functions outside the scope of the muncipali- 
ties Many assets which could have yielded 
revenue to local bodies (especially land), stood 
transferred to these new authorities. Being 
nominated, many of them have functioned with¬ 
out taking into consideration the aspirations of 
the local people and, by and large, have lapsed 
into an ad hoc style of operating. Whilst there is 
no evidence that the existence of these specia¬ 
lised agencies has brought about any improve¬ 
ment of the cities and towns, there has certainly 
been rapid deterioration in the capacity of the 
local bodies to manage them. 

Without organisation and an efficient manage¬ 
ment system, a city cannot run. Therefore, the 
Commission has made a series of crucial 
recommendations about restructuring the city 
administration. Settlements have been divided 
into two categories, those which can be run by a 
single unit of administration, to be called towns, 
and those which are so large that they require 
more than one level of administration, to be 
termed cities. A population of 5 lakhs is the 
suggested cut-off point (i.e. class C-2 and 
above). While towns would have a single level of 
municipal administration, for cities it has been 
recommended that there should be a division of 
functions between those which are city-wise 
and those which are local to a community or 
area. 

The Commission recommends that cities 
should have local councils for tackling defined 
local issues. Election to these local councils 



would be direct, and each council would send a 
prescribed number of representatives (perhaps 
two per council) to the city Corporation. The 
basic concept is that those services and func¬ 
tions which affect the whole city (and which 
cannot be disaggregated and which must be 
professionally managed) should be handled at a 
level of governance which can take an overview 
of the whole city. On the other hand, those 
functions which are of purely local importance 
and consequence should be kept at a level of 
administration with which the average citizen 
can interact personally, and which is directly 
accountable to him. 

In order to professionalise the administration in 
both town and city, the Commission has further 
recommended a clear-cut codification of pow¬ 
ers and functions between the deliberative wing 
(which will frame policy and generally oversee 
implementation to ensure that it conforms to 
the policy guidelines) and the executive wing 
(which will enjoy full autonomy and powers 
within the policy frame). The present conflict 
between Commissioner and Standing Commit¬ 
tee, for example, is sought to be done away with 
by taking purely administrative and executive 
issues out of the purview of Standing Commit¬ 
tees. Once the urban administration is reorga¬ 
nised on these lines, it would not be necessary 
to retain functional agencies and development 
authorities, which could be merged into local 
governments, thus eliminating the present 
scope for conflict between them and local 
bodies. The only exception would be regional 
planning authorities which might cover regions 
which contain several towns and cities. But 
there also, by giving equal representation to 
every local body in the regional authority, an 
effort would be made to ensure operation 
through consensus rather than imposition of 
authority by a superior body. 

Indeed we need to evolve new approaches to 
the development and management of our towns 
and cities, and to strengthen the institutions 
responsible for them. Today most State govern¬ 
ments and municipal administrations are 
saddled with obsolete procedures and attitudes, 
totally incapable of addressing the rapid urbani¬ 
sation they face. The highest priority must be 
given to increasing their skills through new poli¬ 
cies of recruitment and training. VVe need innov¬ 
ative responses at all levels: national, state, city 


and neighbourhood. Every human settlement 
is, in a sense, a unique entity, with its own 
problems—and its own solutions. The increas¬ 
ing centralised decision-making power in this 
country tends to pre-empt initiative, and formu¬ 
lates generalised responses - as opposed to 
local and indigenous ones. Which brings us to 
what is possibly India's greatest national asset: 
her human resources. In fact, in contrast to the 
inertia of the political and administrative sys¬ 
tems, it is encouraging to record the prolifera¬ 
tion over the last decade of citizens' 
associations action-oriented groups addressing 
a wide variety of urban issues, ranging from the 
pollution of our environment and the rights of 
squatter colonies to the preservation of our built 
heritage. These movements should be encour¬ 
aged. They represent the beginnings of a new 
relationship between citizens and government. 

URBAN FORM 

What will these towns and cities of the future 
look like? Will they be amorphous blobs on the 
landscape, characterless, insanitary and 
uncomfortable? Or will they have shape, form 
and character? Will they have human scale? 
These questions are extremely relevant, for 
although cities are both the outcome of eco¬ 
nomic and fiscal policies, as well as the direct 
expression of the socio-political forces at work 
in society, they also very clearly, are material 
entities, existing - like any other piece of hard¬ 
ware - in a physical world. 

This Report has carefully examined this physi¬ 
cal aspect of our urban environment - for the 
Commission firmly belives that within the socio¬ 
economic-political parameters existing in India, 
our towns and cities could function considera¬ 
bly better than they do now. In other words, 
given our levels of per capita income, prevailing 
technology, physical and financial resources, 
our urban centres - as pieces of hardware - 
could work better. They could correspond more 
precisely to our needs. 

Today, there is a brutal mismatch between the 
form of our cities and the way we use them. 
How could they be fashioned to better suit our 
purposes? This question is of particular impor¬ 
tance to us in India because of the rapid urbani¬ 
sation which lies ahead. As discussed earlier, 
the urban environment we see today - both in 
terms of physical size as well as number of 


12 



inhabitants - is only about half of what will exist 
at the end of the next two decades. Thus we 
have an extraordinary opportunity (and obliga¬ 
tion) to consider new growth options concern¬ 
ing not only the development of urban 
settlements across the nation (i.e. GEMs and 
SPURs), but also the physical form and charac¬ 
teristics within each urban centre — from the 
largest metropolis to the smallest town. 

In order to identify the most appropriate built- 
form, the Commission has started by looking at 
the income profile of urban India, and identify¬ 
ing the affordable capital for each economic 
group. This is then related to construction costs 
and densities in three different contexts: the 
building site, the neighbourhood, and the city as 
a whole. In •each case the varying cost of land, 
as well as service infrastructure (roads, water, 
electric supply, sanitation, etc.) and transport is 
taken into account, and also key benefits, such 
as open-to-sky space (e.g. courtyards and terra¬ 
ces which, in the warm climates prevailing in 
India, have a high usability coefficient). The 
trade-off between all these variables clearly 
establishes the appropriateness of low-rise, 
high-density built-form as the primary typology 
for our cities. In addition to its economy, this 
pattern also has a host of decisive advantages, 
viz. it is incremental, it provides variety and 
identity to the inhabitants, it is more adaptable 
to the pluralistic life-styles and cultures that 
constitute our nation, it makes for speedier con¬ 
struction, eases maintenance, and increases 
employment — since it is much less capital- 
intensive than high-rise constructions. 

But there is one other advantage in this pattern, 
perhaps the most crucial of all, and that is 
EQUITY. Low-rise, high-density built-form 
based on a range of plot sizes between 25 sq m 
to 100 sq m (with some plots perhaps up to 200 
sq m) can satisfy the needs of over 95 per cent of 
the urban population. It is a typology which isfar 
more economical than apartments (since no 
space is wasted on public circulation and lifts) 
and one which liberates the public from devel¬ 
opers (since the units can be constructed indi¬ 
vidually and unilaterally). In order to 
operationalise the process, the Commission 
recommends that the development authorities 
first decide on the allocation of individual house 
plots and then lease the land to cooperative 
societies of up to 100 members, retaining the 


occupancy rights of the individual allottees. 
Should the member of a cooperative society 
decide to pool their land and build group hous¬ 
ing or apartments they should be free to do so, 
provided that the total number of members — 
and hence of dwelling units — remains the 
same. This maintains the principle of land 
equity and, at the same time, allows the con¬ 
struction of apartment buildings at perhaps 
even higher FARs at nodal points in the city (as 
and when determined necessary by the 
planners). The Report then examines the den¬ 
sity thresholds implicit in these typologies and 
establishes how the small fraction of existing 
land-use in our cities that crosses these thre¬ 
sholds could be modified by adjusting land-use 
allocations in the city—an objective easily 
achievable during the process of massive 
growth that lies ahead 

The Commission has also examined the spec¬ 
trum of public spaces so crucial to urban form, 
including chowks and plazas, parks and mai- 
dans, and of course streetscapes. In Indian his¬ 
tory, from Harappa and Mohenjodaro, through 
the Vijayanagar town of Hampi, right up to Jai- 
singh's Jaipur, the street as an architectonic 
environment has been supperbly understood. 
Buildings are not allowed to be placed at ran¬ 
dom points on the site, but are organised to form 
continuous facades, thus defining the public 
right-of-way — as for instance in Jaipur where 
the facades of the buildings relate to the public 
spaces the way walls relate to the rooms they 
contain. On the other hand, the cantonments 
built by the British followed a different pattern. 
There the structures were free-standing, set in 
the middle of large compounds. This pattern 
was largely an outcome of the need for security 
(since the large compound, like the maidan, 
served to keep the natives at a distance ): but 
they were also a hand-me-down version of the 
18th century taste of the English country squire, 
whose abhorrence of the urbanity of city life 
had filtered down to the colonial administrators. 
Thus India, and specially her ruling classes, 
inherited the idea of an elite living in large anti 
urban bungalows right in the heart of huge 
crowded cities — as witness New Delhi (or, on a 
smaller scale, Chandigarh). 

This lack of coherent streetscape—almost 
endemic to Indian cities over the last few decades 
has had a lethal impact on urban form A gro 


13 



tesque example will soon be seen in the 
nation's capital where, in a very recent edict, a 
high FAR (2.5) has been combined with a maxi¬ 
mum plinth area of 25 per cent of the site. This 
forces the owner to construct a high-rise build¬ 
ing (at least 10 storeys high, plus about 4 park¬ 
ing floors). Furthermore, the savage set-backs 
on all sides makes certain that these towers will 
have no relationship whatsoever to their neigh¬ 
bours, nor to the street. The Commission firmly 
believes that these confused and ineffectual 
approaches must end. Coherent urban form 
demands a controlled streetscape, one in which 
mandatory building lines are clearly specified. 

This Report also notes the massive number of 
pedestrians moving around our city centres, and 
the urgent need to establish their right-of-way— 
especially in respect of motorised traffic. It also 
emphasises the advantages of creating pedes¬ 
trian precincts, including zones for licenced 
hawkers, and the appropriate street furniture 
(otias, etc.) which would bring this about. 

The relationship of urban form to transport net¬ 
works is also examined, as also question of city 
size—which can be meaningfully addressed 
only if we look at city structures as well. For 
structure determines the holding capacity of a 
city, as also the amount of urban land gener¬ 
ated, the pressure points, and so forth. Given 
the growth that lies ahead, most of our cities 
would probably gain immeasurably by being 
restructured to form polycentric systems which: 

(1) allow citizens to enjoy the better quality 
of life obtainable in a smaller centre, as 
well as the economies of scale inherent 
in being part of larger system; and 

(2) offer more growth options for future 
generations. 

As the city grows, the intelligent placing of 
important civic and religious buildings, at nodal 
points in the city structure, is of primary impor¬ 
tance in the generation of coherent urban form. 
This was done with spectacular success in the 
great cities of the past (as witness Fatehpur 
Sikri), as well as in this century (e.g. Lutyen's 
Delhi). These mounmental buildings become 
urban 'events', not only giving character and 
meaning to the environment that surrounds 
them, but also acting as coordinates on the city- 


scale, providing a sense of orientation and direc¬ 
tion to passers-by. In the final analysis, such 
images can become the symbols for the entire 
city, as has been the case of the Charminar in 
Hyderabad, and the Gateway of India in Bom¬ 
bay. Given the scale of urbanisation that lies 
ahead, it is important that we in-build an under¬ 
standable structure of such urban events into 
the fabric of the city as it grows. These nodal 
points (and the images they create) serve to 
articulate entire neighbourhoods, giving each of 
them a distinctive identity. They generate a 
greater sense of civic life, thus allowing the city 
to expand not as an amorphous, undifferen¬ 
tiated mass of built-form, but with coherent and 
rhythmic syntax. 

HOUSING 

Housing has been recognised as the basic 
need, ranked next only to food and clothing. But 
resources allocated and policies pursued have 
not yielded the expected results. Forty million 
people (about 25 per cent of India's total urban 
population) live in slums and under conditions 
of multiple deprivation—illegal land tenure, def¬ 
icient environment and kutcha shelter. In addi¬ 
tion, a significant number live in inner-city 
neighbourhoods with decaying buildings and 
deficient services. The supply of new shelter 
units is not adequate to meet incremental 
needs—leave aside the backlog. This may lead 
to a doubling of slum population—75 million by 
2001. Nearly sixty per cent of households can¬ 
not afford a conventional pucca house and the 
lowest 10-15 per cent cannot even afford a ser¬ 
viced site. Furthermore, given the resource con¬ 
straints, it is not possible to provide new pucca 
houses for all in the near future. The emphasis 
of housing policy therefore has to be on increas¬ 
ing shelter supply, improving and upgrading 
slums and conserving the existing housing 
stock. 

There are four factors vyhich are essential for 
achieving a substantial increase in the supply of 
housing: land, finance, building materials and a 
simplification of building regulations. We have 
already dealt with land and finance in earlier 
paragraphs. But, even at the cost of repetition, it 
needs to be emphasised that these are the two 
most important essentials for changing the 
housing situation. Land prices have to be 
brought down from their present absurdly high 
scarcity values to prices close to actual produc- 


14 



tion costs. Housing in itself has to be made 
affordable. In fact, this must be the essential 
purpose of injecting more finance into the hous¬ 
ing sector. There is no point in making funds 
available for the purchase of unaffordable 
homes. The beneficiaries then can only be the 
developers. Finance must therefore be linked to 
a supply of reasonably priced accommodation 
and must itself be affordable. This involves pro¬ 
vision of housing finance at lower than commer¬ 
cial interest rates with 20 or 30 year repayment 
periods and progressively rising repayment 
instalments which keep pace with rising 
incomes and increasing ability to pay. 

For a major housing development programme 
to succeed, it is essential that the supply of 
standard, orthodox, conventional building mate¬ 
rials is reliable in term^ of quantity and quality 
and that a spurt in demand does not lead to price 
rise. While some good work has been done in 
non-conventional building materials, there is no 
doubt in our minds that the vast majority of 
Indian homes will have to continue to rely on 
conventional materials. The concept of develop¬ 
ing materials banks, therefore, acquires a new 
importance and new initiatives need to be taken 
to improve availability and quality and to bring 
down costs. In this connection, special attention 
should be given to mud, that timeless material 
which over the centuries has been the basic 
building block of most of India's villages, and 
which, with inexpensive additives easily availa¬ 
ble with today's technology, can be further 
strengthened and stabilised. 

The regulatory provisions governing housing 
development also need to be substantially modi¬ 
fied, Existing regulations are often of a nature 
which effectively preclude affordable housing 
and belong essentially to an era when there was 
less of a mismatch between incomes and con¬ 
struction costs. Housing for the urban poor and, 
in particular, sires and services schemes, can- 
nat be created if the existing regulatory provi¬ 
sions are made obligatory. 

In this context, it is necessary to look upon the 
sites and services programmes not as a way of 
helping the poor alone but as a way of increas¬ 
ing the suply of serviced land to the entire cross- 
section of the society. The existing programmes 
need to be enlarged and their scope extended to 
cover employment generation, provision of 


home expansion loans, provision of off-site 
community infrastructure facilities, involve¬ 
ment of voluntary agencies, and encouraging 
sites and services types of development in the 
joint sector through various land assembly 
techniques. 

In situ slum upgrading, including grant of 
secure land tenure, provision of basic environ¬ 
mental services, and granting home improve¬ 
ment loans, has generally been accepted in 
principle. But the scope of such programmes 
needs to be enlarged and the speed of imple¬ 
mentation accelerated. This could be achieved 
by effective beneficiary participation through 
voluntary agencies. 

The policy of granting land tenure to squatters 
does not however imply that grabbing open 
lands should be allowed to become an accepted 
way of securing access to land. Increasing 
supply of serviced land on an adequate scale 
has therefore to be an essential concomitant of 
the tenure policy. 

Inner city neighbourhoods which are experienc¬ 
ing widespread obsolescence and dilapidation 
also require urgent action to arrest further deg¬ 
radation. This existing housing stock also needs 
rehabilitation and conservation. The newly 
created Housing Bank should make institutional 
finance available not only for new construction 
but also for repairs and rehabilitation of the 
existing stock. 

There are always some households which are 
either not interested in owning a house or just 
cannot afford to own one. For such households 
rental housing is the only option. In 1981,56,80 
per cent of urban households were living in 
rented premises. The main factors inhibiting 
investment in rental housing and in the mainte¬ 
nance of rental stock are the various rent control 
laws. The Commission had made extensive 
recommendations concerning reforming rent 
laws in its Interim Report, which have been 
reiterated here. 

The existing rent acts have had a most delete¬ 
rious effect on the housing situation : poor main¬ 
tenance and premature decline of housing stock 
due to unrealistically low rental incomes; the 
consequential insecurity of those who live in 
such dilapidated buildings; the decline in the 


15 



quantity of housing constructed for rental 
whether by the state or by private individuals; 
the holding back from the rental market of unoc¬ 
cupied houses for fear of losing control; 
demands for up-front and illegal payments; and 
the stagnation of municipal revenues where 
these are linked to old rents. 

In the case of commercial premises, as well as 
luxury apartments, it is clear that both landlord 
and tenant are often equally privileged. There¬ 
fore, bearing in mind the importance of protect¬ 
ing the economically weaker sections from the 
unleashing of market forces, the Commission 
has the following recommendations to make : 

a. All existing tenancies should continue to 
enjoy tenure protections but rents 
should be adjusted upward such that 
there is a 100 per cent neutralisation of 
increases in the consumer price index 
from 1974 onwards for non-residential 
premises; 50 per cent neutralisation up 
to, say, January 1, 1989, and 100 per 
cent thereafter for residential premises 
of 80 sq m and more and 100 per cent 
neutralisation only after January 1, 
1989, for residential premises under 80 
sq m. 

b. In the case of premises rented after Jan¬ 
uary 1, 1989, none of the provisions of 
the rent acts should apply, not even 
tenancy protection, for non-residential 
premises and residential premises of 80 
sq m and more. However, in the case of 
residential premises below 80 sq m 
tenancy protection would be available 
but rent should be linked to a 100 per 
cent neutralisation of the consumer 
price index. 

c. Litigation should be brought out of the 
purview of civil courts and instead 
placed within the jurisdiction of quasi¬ 
judicial tribunals which should adopt 
summary procedures, though the writ 
jurisdictions of the High Courts and the 
Supreme Court would continue. 

WATER AND SANITATION 

Regardless of whether we are looking at the 
new growth centres of the future, the existing 
urban settlements which make a substantial 


contribution to national wealth, or the cities and 
towns which are stagnating, one common 
strain is the total inadequacy of water supply, 
drainage, sewerage and housing. Under Article 
47 of the Constitution, it is the duty of the State 
to improve the standard of living of the people 
and, in particular, to improve public health 
standards. Water, sewerage and housing are 
three critical elements for life, without which 
there can be neither health nor comfort. 

The Commission has noted with deep regret 
that these three most critical areas relating to 
urban development, have been given, respec¬ 
tively, 1 per cent, 1.36 per cent and 1.6 per cent 
of the outlay for the Seventh Five Year Plan. 
Taking the share of the central sector in all three 
activities combined, it comes to 0.25 per cent of 
the Plan, with no central assistance for urban 
water supply and sanitation. This means that 
even the meagre amount available under the 
Plan is largely notional because, without the 
spur of matching central contributions, the state 
governments treat the urban sector as one of 
low priority and do not adhere to the provisions 
made in the Plan. The Commission feels very 
strongly that, if a beginning is to be made in 
providing at least the basic services to all our 
urban settlements, the share of urban develop¬ 
ment, housing and urban water supply and san¬ 
itation must go up to at least 8 per cent of the 
Plan, with half of this coming from the central 
government. Then and then alone will it be pos¬ 
sible to extend at least some basic services to 
our towns and cities. 

A major feature of our urban scene is the misery 
and serious health hazards caused by lack of 
water supply and sanitation. Almost all our 
urban centres, even those which at one time 
had reasonably adequate water supply, are now 
suffering from crippling shortages. It is a matter 
of national disgrace that, in 1988, there were 
prolonged periods when Hyderabad and Mad¬ 
ras received piped water supply for only about 
20 minutes a day—with many localities doing 
without water for days on end. Delhi, too, has 
had to face severe problems in the summer of 
1988. 

On the one hand, there is no long-term planning 
for urban water needs; on the other, there is a 
constant paucity of funds. The Ministry of Water 
Resources Development has gradually evolved 


16 



basin development plans for our major rivers for 
the purpose of irrigation and hydro-power devel¬ 
opment, but urban water supply is looked upon 
as a totally residual item. It does not seem to be 
adequately realised that if water is an input into 
agriculture, it is equally an input into non- 
agricultural productive activity. It is erroneous to 
assume that water for urban use is less impor¬ 
tant than water for a field of sugarcane. Both are 
equally critical. 

The Commission recommends that unified 
plans should be drawn up for all water resour¬ 
ces and their utilisation, both for agriculture and 
for urban use. The allocation of water resources 
should be done in an integrated manner, which 
means that the funding of water development 
and utilisation schemes should treat all uses on 
an equal footing. The Seventh Plan allocates a 
total of Rs 16,979 crores for irrigation, com¬ 
mand area development and flood control. The 
Commission feels that the allocation would 
have been much more meaningful if it had 
taken into account the requirements of water 
for non-agricultural purposes also. It is hoped 
that the Eighth Plan will look at water resources 
and their use in totality, rather than for agricul¬ 
ture alone. 

The Commission has looked into the ways in 
which our urban centres utilise their water. Var¬ 
ious studies on the subject indicate that as 
much as one-third of the treated water is 
wasted because of leakages in the distribution 
system. Even before we think of augmenting 
water supply we should ensure that line losses 
are decreased substantially. If the major part of 
the water which is lost in transit in fact becomes 
available for distribution, many cities would 
have adequate water for at least the next 
decade. Investing in the repair of an existing 
system is obvioulsy much less costly than aug¬ 
menting the system through new works. If 
Vadodara, for example, instead of spending Rs 
60 crores for additional water supply, were to 
invest Rs 2.5 crores cn improving the system, 
the city could carry on til! the end of the century 
with the present system. Studies should be 
undertaken immediately of the water supply 
system in urban centres throughout India and 
measures suggested to improve their efficiency. 
Money must be found on a high-priority basis 
for improving the existing systems. At the same 
time, the Commission also recommends that 


normative standards of supply should be 
reviewed and the new standards applied to dif¬ 
ferent categories of towns and cities. 

In the matter of water supply, the Commission 
also feels that various options should be looked 
at and that technical staff be reoriented to view 
water-supply schemes, not solely as piped 
water supplied through a mains system. There 
has to be acceptance of such alternatives as 
localised supply from underground and surface 
sources which serve only one or two localities, 
household-based supply from individually 
owned sources, or a combination of some or all 
of these. There is nothing new about this idea 
because, even today, most newly developed col¬ 
onies have their own water supply systems. 

Regarding sewerage, since, in the foreseeable 
future, we are unlikely to achieve a level of 
water supply which would permit a universal 
water-borne system of sewerage, the Commis¬ 
sion recommends that, where the water supply 
is inadequate, there should be no mains sewer¬ 
age system, because it obviously will not work. 
Therefore, in planning waste disposal there 
should be a disaggregated approach analogous 
to that suggested for water supply. This does not 
mean that no mains sewerage project will be 
undertaken, but that there should be ready 
acceptance of alternative systems which may 
be cheaper and more appropriate to Indian con¬ 
ditions (where adequate water is often not avail¬ 
able). If the systems are properly designed, it 
should be possible to generate by-products, 
including gas and manure, as well as treated 
water which could be used for irrigation and 
gardening. 

It is estimated that, by the year 2001, the city of 
Delhi will generate approximately 4,100 million 
litres of sewage per day, out of a total water 
supply of approximately 5,100 million litres per 
day. The non-domestic requirement of water in 
Delhi is a quarter of the total water supply, 
which will be approximately 1,3(X) million litres 
a day by the year 2001. To the extent that sew¬ 
age can be recycled, the need to impound, pump 
and treat raw water is reduced If one-third of 
the sewage generated by Delhi is made availa¬ 
ble (after proper treatment) for industrial use, 
fire-fighting and garden purposes, Delhi would 
need, by 2001, about 4,000 million litres of 
treated water per day instead of 5,100 million 
litres. 


17 



The treatment of sewage, including up to the 
tertiary stage, would be very much cheaper than 
the impounding, transport and subsequent 
treatment of raw water for distribution. The 
Commission strongly recommends that, as a 
means of reducing the water requirement of 
cities, every major centre which generates a 
substantial quantity of sewage should install 
adequate recycling facilities so that the treated 
effluent is utilised for non-domestic purposes. 
This should be a high-priority requirement and 
the Central Government should provide ade¬ 
quate assistance for this purpose. Plan priorities 
must be altered accordingly Similarly, there 
should be both recycling of solid waste and its 
utilisation for manufacturing gas, etc. At pres¬ 
ent, most large cities dump solid waste as land¬ 
fill, which only serves to spread insanitation. 

TRANSPORTATION 

All our major cities are plagued with traffic con¬ 
gestion. The obvious factors responsible are the 
concentration of too many people and activities 
in too small a space, and the inefficient relation¬ 
ships of work-places and residences. In the past 
two decades, the situation has deteriorated sig¬ 
nificantly, The total number of trips per person 
per day, the average trip length and trip cost 
have all increased. In the absence of an inte¬ 
grated policy and coordinated approach, intra¬ 
city transportation fias grown in a haphazard 
manner, without any long-term perspective, 
causing congestion and severe crises in our 
cities, 

An urban transportation system can be deve¬ 
loped optimally only when transport and land- 
use planning are examined together. Transport 
is not a separate entity in itself, but is part of an 
intricate feed-back involving locational deci¬ 
sions in the city. Too often, traffic engineers are 
given a brief wherein the existing land-use 
patterns—and hence the desire lines across the 
city—are unquestionable 'givens'; then they 
are asked to postulate traffic 'solutions'. This 
then takes the form of exorbitantly expensive 
hardware (flyovers, freeways, underground rail¬ 
ways etc.) which we cannot afford to imple¬ 
ment. In any case, the efficiency of such 
palliatives is short-lived, since ease of move¬ 
ment encourages more journeys, thus clogging 
the traffic arteries once again. It must be rea¬ 
lised that land-use and traffic are but two sides 
of a single complex. Far from taking existing 


desire lines as immutable givens’, we should 
examine alternative patterns of land-use which 
would optimise our traffic systems by altering 
these desire lines. This is a crucial option not 
available to traffic planners in the West (where 
urban population have already stabilised—often 
in rather inefficient patterns), but is perfectly 
viable in Indian contexts, where urban centres 
double in size within two decades. 

Another important change we need to bring 
about is in the present bias—especially evident 
among our urban elite—towards personalised 
transport. The same person who would happily 
wait for a bus in London would never be seen in 
a similar queue in Bombay or Delhi. There 
seems to be an extraordinary social/psychologi¬ 
cal barrier operating, inherited from the sahib 
life-style (which, as discussed under Urban 
Form, also makes our power elite want to live in 
large anti-urban bungalows right in the heart of 
what are some of the most crowded cities in 
world). How do we break down this barrier, this 
taboo? As a first step, the Commission has 
recommended the introduction of mini-bus ser¬ 
vices, which can be signalled to a stop any¬ 
where along the street (thus avoiding the 
trauma of standing in a queue!). The tariff could 
be about three times that of the regular bus 
service and about one-third that of a taxi ride. 
The advantages would be considerable: firstly, 
almost every passenger in the mini-bus would 
represent one less car on the road. Secondly, 
once the social/psychological barrier (really the 
class barrier) is broken, these decision-makers 
and their families would probably start using the 
regular bus services—which, given the nature 
of our society, woud then improve by leaps and 
bounds. 

Though public sector bus transport undertak¬ 
ings enjoy unlimited protection from Central 
and State Governments, their performance has 
been far from satisfactory, with ever-mounting 
losses and low levels of performance. In order to 
ensure better service, it is essential to bring 
about a judicious balance between public and 
private sector operation. There are very strong 
economic and performance indicators in sup¬ 
port of such a rationale for breaking the monop¬ 
oly of the public sector. The privatisation of a 
selected number of routes should, therefore, be 
seriously considered. The modalities of opera¬ 
tion should be based on performance critieria 
and productivity. 


1R 



ENERGY 

The Commission is of the view that electricity- 
supply planning and pricing should be employed 
as important policy tools to promote the urbani¬ 
sation patterns recommended in this Report. 
Electricity is the prime mover for industry and 
draws industries to locate in those areas where 
there is relatively continuous power supply. 
Delhi, for example, is attracting industry 
because of the more assured supply there as 
compared to the adjoining smaller towns. 

Pricing can also be employed effectively to influ¬ 
ence the pattern of urban growth. Presently, 
most electricity boards have tariff structures 
which are differentiated only by sector and not 
spatially. All industries in a state pay the same 
rate for electricity, irrespective of where they 
are located. Tariff differentials should be worked 
out such that there is a definite encouragement 
for industry to locate in preferred areas. 

Another issue that needs to be considered is 
that of the role of the private sector in the gener¬ 
ation of electricity. With increased urbanisation, 
the power requirements will no doubt grow sub¬ 
stantially. It is unlikely that investments in elec¬ 
tricity generation by the public sector alone will 
be sufficient to meet the increasing demand. 
The Commission, therefore, feels that, the pri¬ 
vate sector should not be excluded from the 
area of power generation and distribution but 
should, in fact, be encouraged to enter it. 

Transportation within and between urban set¬ 
tlements accounts for a major share of urban 
energy requirements. Various modes of trans¬ 
port have different characteristics in terms of 
energy consumption. Moreover, the spatial patt¬ 
ern of urban development and the mix of urban 
functions can strongly influence the number 
and length of passenger trips. In planning the 
structure of urban settlements, due regard 
should be paid to the amount and energy effi¬ 
ciency of transport required. 

At present, urban development plans do not 
give adequate consideration to mass public 
transport. In preparing development and traffic 
plans, specific measures should be built in to 
facilitate the efficient operation of a publictrans- 
port system. The plans should also provide for 
bicycle paths and pedestrian w'alks, in order to 
facilitate non-motorised movement. 


We should also establish laws regulating 
energy use in buildings, defined in terms of 
energy per square metre of floor area. This will 
encourage innovation in design and construc¬ 
tion in order to find economical and acceptable 
ways of meeting the required standard. Building 
regulations should take this factor into account. 

The use of solar energy should be made compul¬ 
sory in commercial buildings, particularly hot¬ 
els, hospitals, restaurants, office canteens, etc. 
and encouraged in other types of built-form, 
including housing, where densities would need 
to be low enough to permit adequately sized 
solar energy collection. The use of bio-gas on a 
city scale should also be examined. 

The Commission feels that energy planners 
have not fully appreciated the impact of urbani¬ 
sation on the quantity and type of fuels that 
would be demanded by households for cooking 
and heating. We need a perspective plan for 
household energy, keeping in view the urbani¬ 
sation process spelt out in this Report. In partic¬ 
ular, it is important to pay attention to firewood 
use in urban areas because; 

— it is a major fuel used for basic needs by 
the poor, 

—• currently, about one third of the total 
fuel-wood is used in urban areas, and 

— urban consumption of fuel-wood con¬ 
tributes to deforestation. 

An analysis of data on expenditure shows that 
the urban poor spend a substantial share (12 to 
16 per cent) of their income on purchasing fuels 
for meeting their cooking and heating needs. In 
contrast, the urban rich only spend 6 to 7 per 
cent of their incomes on household fuels. To 
make matters worse, the urban poor are forced 
to consume fuels which are high in cost, low in 
efficiency and, being smoky, cause health 
hazards. It is imperative that an integrated policy 
of energy prices and supplies, covering all fuels 
(including electricity) is evolved which would 
meet the twin objectives of equity and 
efficiency. 

CONSERVATION 

India's architectural heritage is truly extraordi¬ 
nary. Our towns and cities, especially the his¬ 
toric quarters in the older urban centres. 


19 



present a number of unique characteristics 
worthy of preserving Apart from the most out- 
standing buildings, this must also cover the rela¬ 
tionship between groups of buildings and the 
spaces around them, certain focal points or 
landmarks in the city-scape, and that part of the 
architectural fabric which expresses special 
vernacular styles. 

For urban conservation is no longer confined to 
preservating isolated buildings of outstanding 
architectural importance, but must involve a 
much broader approach, one which aims at 
identifying and retaining those parts of the built- 
environment whose character is vita! to our natu¬ 
ral and real heritage. It, therefore, follows that 
any new development, or redevelopment, 
should be in sympathy with, and contribute to, 
the character of that area. 

Recycling buildings for adaptive reuse opens up 
enormous possibilities (seen so far only on a 
small scale in the hotel sector and in some 
government-occupied buildings). Some of the 
country's most outstanding buildings in urban 
areas requiring special attention and care are 
under the direct control of a number of govern¬ 
ment agencies and the Commission has offered 
many suggestions on how this can be provided. 

A package of incentives and fiscal reliefs to 
encourage better maintenance and upgradation 
of the usable housing stock on the one hand, 
and some legislative provisions to protect that 
part of the heritage which is deemed to be of 
lasting value on the other, will be needed for 
creating an awareness of economic and social 
benefits of the proposed conservation policy. 

RENEWING THE CITY 

All matter, whether organic or inorganic, has a 
life cycle. Decay is built into the very process of 
creation. A city structure too has a similar 
dynamic. Where market forces operate, a decay¬ 
ing area falls in price and there is an incentive to 
buy over cheap properties. These are redeve¬ 
loped and, being renewed, command a greater 
price. The city core thus passes through a cycle 
of high value with new developments, low value 
as passage of time causes decay, and then, once 
again, high value through redevelopment. 

In urban India, rent laws and industrial develop¬ 
ment policy inhibit the phasing out of uneco¬ 


nomic land-use its replacement by new 
development. Whether it be the old city in Delhi, 
the mill area of Parel in Bombay, or the j^hatals 
of Calcutta, all the older parts of our major cities 
have been allowed to degenerate into slums. 
Thus good available land gets locked into a use 
which neither yields revenue, nor supports 
gainful employment. Furthermore, it is not avail¬ 
able for housing or for any form of social infras¬ 
tructure which benefits the community. Finally, 
the low values of these properties deny the city 
resources which would flow out of municipal 
taxes based on a realistic evaluation of rentals 
and property values. More than anything else, 
the stagnating cores of our large cities have 
contributed to the decline of what were onte the 
thriving nerve centres of this nation. 

The Commission is acutejy aware of the fact 
that the major urban settlements need a great 
deal of support iftheyareto recover their health. 
The answer, however, does not lie in merely 
pumping in ad hoc funds from time to time. 
While it can be argued that Calcutta would have 
been a much worse city if support had not been 
extended, and that the services of Delhi would 
have been even poorer if massive Plan aid had 
not been made available, this kind of 'help' has 
also resulted in these Cities refusing to take a 
good, hard look at their own tax-base in order to 
raise resources internally. 

In this connection, it is intriguing to note that the 
higher the real estate prices climb in our met¬ 
ropolises the more viable become the strategies 
for recycling urban land (e.g. replacing unde¬ 
rused and outmoded industry or port facilities 
either by housing or by new, state-of-the-art 
industry). Thus the distorted scarcity value of 
existing buildings in the city of Bombay could 
make viable the cost of a railway bridge to the 
mainland (through the levy of a betterment cess 
on building construction at the other end). In 
short, ;he worse conditions in our cities 
become, the more amenable they could be tO 
solution; for the prices climb, the greater the 
incentive created by the difference between the 
scarcity value of That accommodation and its 
replacement cost in a new location. All our 
major cities abound in examples of industries 
seeking permission to remove their factories 
from the heart of the city to locations outside 
with the land so released being used for alterna¬ 
tive purposes within the general ambit of the 


20 



^ster plan. The labour force thus displaced 
\jld be taken care of by payment of compen- 
,. ^n or absorption at the new location. Politi¬ 
cal interests have so far succeeded in stalling 
almost all such proposals. The release of land in 
the very heart of a metropolis (part of it for social 
" purposes, part for giving profit to the landowner, 
and the rest for bringing in such compatible 
activities as would generate wealth) would have 
completely transformed overcrowded localities. 
And this could happen without any cost to the 
State. What the large cities need is not .so much 
an infusion of funds as a clearing of the cob¬ 
webs of the mind so that the resources locked 
•jp within a city become available for construc¬ 
tive purposes. This Report has, therefore, 
recommended in detail the steps necessary to 
permit periodic recycling of land within a city so 
that there is a constant upgradation of both 
infrastructure and employment. 

URBAN LEGISLATION 

The Commission feels that urban India is over¬ 
regulated, with laws and rules which inhibit 
enterprise rather than encourage it. Broadly 
speaking, these laws and rules could be catego¬ 
rised as laws relating to planning, those relating 
to land, those relating to municipal administra¬ 
tion, and fiscal laws. The Commission's views 
on each of these are outlined below. 

Laws relating to planning: The town planning 
acts and their offshoots are the basic laws 
which relate to planning. They tend to be largely 
negative in their approach. They state what can¬ 
not be done, they make rigid prescriptions about 
land-use and they hinder land development 
rather than facilitate it. The underlying assump¬ 
tion in the existing planning laws is that it is 
possible to put cities in a strait-jacket, regard- 
less _of the dynamic forces which might operate 
on them. Thus, the Delhi Development Act 
starts with the preamble that it is an Act to 
provide for the planned development of Delhi; 
the Madhya Pradesh Town & Country Planning 
Act refers to the planning and development of 
land, the execution of town planning schemes, 
and the compulsory acquisition of land. None of 
the acts speaks of the people who inhabit the 
cities. The Commission, therefore, feels that not 
only the approach to planning should be 
changed but even the laws should be altered in 
■ 4 uch a way that they generate collective and 
individual initiative in the process of city 
development. 


Laws relating to land: State intervention in the 
urban land market is imperative for ensuring 
land for the urban poor. The Urban Land (Ceiling 
and Regulation) Act, 1976, has, however, failed 
to transfer vacant land to State ownership, in 
fact, has led to an increase in land prices. 
Because of the urgency of the situation, the 
Commission in its Interim Report had suggested 
amendments to the Act. On further considera¬ 
tion, the Commission feels that the Act be 
changed radically to encourage owners to 
develop the land for housing the lower and mid¬ 
dle income groups, or pay a heavy tax for keep¬ 
ing the land vacant; they would be compelled to 
surrender it to the statb if it is not developed 
within a five year period Another alternative 
would be not to have a Ceiling Act at all, but to 
bring all underutilised land under a punitive tax. 
The proceeds of the tax in either case would be 
used to create a Shelter Fund for the poor. 

The supply of serviced land can also be 
increased by promoting what is generally 
termed as land assembly. Here the basic princi¬ 
ple is that the land values increase significantly 
when a proper layout is prepared and infrastruc¬ 
ture developed. The increase in value is of such 
magnitude that even after allowing for land 
used for infrastructure and public purposes, the 
schemes offer an attractive rate of return to 
private land owners on the value of the undeve¬ 
loped land. This can form the basis for joint 
participation of private land owners and public 
agencies in land development. The Town Plan¬ 
ning Schemes implemented in Gujarat and 
Maharashtra, therefore, deserve replication in 
other states. In these schemes half the incre¬ 
mental value is to be recovered as betterment 
levy. Variations of similar approach where part 
of the land is retained by the public agency for 
recovering the cost of infrastructure and/or pro¬ 
viding sites to urban poor could also be 
attempted. 

Several factors today prevent a city from devel¬ 
oping along desirable lines. One is the plethora 
of laws, rules and regulations which restrict 
rather than encourage. Ahmedabad has few 
unauthorised colonies because the provisions 
relating to town planning schemes permit the 
owners of open land to get layouts approved, 
exchange land on an equitable basis where the 
planning norms so require, and develop hous¬ 
ing layouts. Almost half the population of Delhi 



and Bombay live in unauthorised colonies 
because the system of planning militates 
against landowners developing their own lands 
and, therefore, when demand outstrips supply, 
people build unauthorisedly. Whether the res¬ 
trictive laws relate to planning or whether they 
arise out of misplaced social legislation, the 
Commission recommends that they be done 
away with so that new lands come on the 
market at a rate commensurate with demand. 

There are two other sets of laws relating to land 
which need drastic change. The first relates to 
urban land tenure. One reason why the land 
market is distorted in India is that urban tenan¬ 
cies are highly complicated, with the result that 
a mortgage market or a market for sale and 
purchase of land has not developed adequately 
This leads to underinvoicing of land values, eva¬ 
sion of stamp duty and registration fees, and the 
use of unaccounted funds in the matter of land 
sale and purchase. The laws relating to tenure 
must also be simplified. 

The second set of laws requiring revision relate 
to sub-division, diversion from agricultural use 
and the ceiling on holdings in urban areas. In 
the urban context, diversion of land to urban use 
and sub division should form a part of planning 
laws and not of land revenue codes. If there is 
no planning objection to diversion of land, then 
it is the layout which should generally deter¬ 
mine sub-division. What should be done, how¬ 
ever, is to tap the incremental value of diverted 
land so that money becomes available for devel¬ 
opment of the infrastructure. With regard to the 
ceiling on holdings, the law has yielded no 
results, both because it is defective and because 
there is no will to enforce it. Its purpose was to 
ensure that there is no cornering of land for the 
purpose of speculative profit and there is equity 
in land distribution. A secondary purpose waste 
make available land for city development, espe¬ 
cially for social purposes. The Cc ..mission has 
recommended that the law should be so 
amended that the holding of vacant land or the 
retention of land under uneconomic use iS so 
heavily taxedjto finance a shelter fund for the 
poor) that there is a strong incentive to develop 
land quickly. 

Laws relating to municipal administration ; Like 
town-planning laws, these also tend to be regu¬ 
latory in their approach. The extent of unautho¬ 


rised construction suggests that the laws have 
failed. The Commission feels that, regulation of 
activity in identified areas, specified uses or in 
the case of buildings which totally dominate, the 
rules relating to housing, should be made as 
liberal as possible. If the guidelines provide for a 
development envelope, the detailing within that 
envelope need not be of great concern to the 
local bodies. Instead, the laws should be 
amended in such a way that the discretionary 
powers of local bodies to raise resources, frame 
bye-laws and regulations, etc. are greatly 
enhanced and the interference of government 
reduced. 

Fiscal laws : At present, fiscal laws are heavily 
weighted against city development. Tax rebates 
are offered for investment in industries in back¬ 
ward areas. Is a city which largely consists of 
slums, not backward? Should incentives not be 
offered for investing in housing in such a city? 
The Commission feels that the fiscal laws 
should be so amended that those businesses 
which contribute to city development, either 
through infrastructural development or by 
investment in social housing, etc., get such tax 
incentives by way of encouragement. At the 
same time, the tax laws should discourage and 
penalise those who add to the city's burden. 
Provided the tax laws are properly devised and 
operated, they can bring about substantial and 
beneficial change in the structure of cities. 

AT THE CROSSROADS 

The National Commission on Urbanisation is 
convinced that urbanisation provides alterna¬ 
tives to poverty and stagnation for the surplus 
rural population. Furthermore, it provides a 
market for agricultural produce and thus 
encourages higher production, provides servi¬ 
ces to the rural areas, helps in the creation of an 
adequate social infrastructure in the villages, 
and encourages the strengthening of the rural- 
urban continuum. Urbanisation, thus, is a posi¬ 
tive input into rural development. 

We are at a crossroads at which two distinct 
options are available. The first is a non¬ 
interventionist approach which would gradually 
see large urban centres grow to the point where 
growth itself begins to destroy. This is the road 
to disaster. The second option is that by approp¬ 
riate interventions and basically sound spatir 
distribution, settlements are strengthened £ 


22 



that there is growth in equilibrium at various 
levels of settlements. The policies recom¬ 
mended in this Report could bring about, by the 
year 2001, a more balanced and productive sys¬ 
tem of urban centres across the nation. If, by 
that year, we bring down the net reproduction 
rate (NRR) to unity, the nightmarish horrors of 
the open-ended population growth we expe¬ 


rience today would be gradually dissolving into 
a thing of the past. 

The Commission unequivocally endorses the 
second option. It is well within our power to 
bring about the emergence over the next two 
decades of a strong, prosperous, and efficient 
urban India. 


CLASSIFICATION OF CITIES AND TOWNS ADOPTED BY THE NATIONAL COMMISSION 

ON URBANISATION 


Class of Cities 

Range of Population 

C 1 


1 Lakh to 5 Lakh 

C2 


5 Lakh to 10 Lakh 

C 3 


10 Lakh to 20 Lakh 

C 4 


20 Lakh to 50 Lakh 

C 5 


50 Lakh to 100 Lakh 

C6 


100 Lakh & above 

Towns 


T 1 

. 

20,000 to 50,000 

T2 

; 

50,000 to 100,000 



CENSUS 

CLASSIFICATION OF CITIES AND TOWNS 

Class of Cities/ Towns 

Range of Population 

Class 1 


100,000 and above 

Class II 


50,000 to 99,999 

Class III 


20,000 to 49,999 

Class IV 


10,000 to 19,999 

Class V 


5,000 to 9,999 

Class VI 


Below 5,000 


According to Census practice. Class 1 cities denote towns with population of 1 lakfTft above. 






Recommendations 


The Commission, having looked into various 
facets of urbanisation, has made detailed 
recommendations, listed at the end of each 
chapter in Volume li of this Report. Our principal 
recommendations are summarised below. 

Dimensions of Urbanisation 

1. The urban centres which can generate 
economic momentum and require priority in 
development have been identified. They include 
National Priority Cities (NPCs), State Priority 
Cities (SPCs), Spatial Priority Urbanisation 
Regions (SPURs) and the small towns which 
serve the rural hinterland. From the 8th Plan 
onwards the fullest support must be given to the 
development of the identified growth centres. 

2. The process of urbanisation can and must be 
used to improve agricultural performance and 
create localised employment opportunities. 

3. Population control measures must be made 
really effective in both urban and rural areas in 
order to stabilise the urban situation. 

IjtmO 

4. Since the most disastrous feature of Indian 
urbanisation has been the failure to anticipate 
the rising demand for urbanised land, a key 
resource of urban planning, the supply of such 
land should be given the topmost priority, 

5. A Settlement Survey of India should be 
established at national level and a Directorate of 
Urban Land in each state. At the city level there 
should be an Urban Land Manager under the 
control of the District Collector. 


6. The urban land tenure system must be 
changed to ensure security of tenure. 

7. Future land requirements, especially for 
housing the poor, should be anticipated and 
provided for. 

8. Squatting on public land may be regularised 
where possible, but land required for public and 
social purposes must be protected and selective 
re-location of squatters from ecologically 
sensitive land must be undertaken. 

9. The State must intervene to provide 
equitable access to land, 

10. To bring increasing quantities of land to the 
market the Urban Land (Ceiling & Regulation) 
Act, 1976, should be drastically amended, and 
supplemented by taxation measures that would 
discourage landowners from keeping their land 
vacant and encourage proper utilisation. 

11. Various forms of land assembly, through 
land exchange scheme, layout approval and 
other similar measures should be encouraged. 

12. The Land Acquisition Act should be 
amended to eliminate delay and ensure timely 
payment to the affected citizens. 

13. All laws whicfi inhibit or restrict the 
recycling of land should be suitably modified. 

Water and Sanitation 

14. A holistic rather than a compartmentalised 
view of water resource management should be 
taken. 


24 



15. Water, being an absolutely critical input for 
human survival, must be treated as such and 
accorded suitably high priority in the planning 
process. 

16. The immediate objective should be the pro¬ 
vision, on an equitable basis, of at least 70 litres 
of water per capita per day in urban areas for 
domestic requirements. 

17. To ensure better maintenance of existing 
water systems, an additionality of Rs. 1000 
crores per annum must be provided to local 
bodies. Waste water recycling and its use for 
non- domestic purposes should be encouraged. 

18. To ensure water conservation, a differential 
tariff on water use should be applied, with a 
sharp increase in the rate charged for consump¬ 
tion in excess of 100 litres per capita per day. 

19. Legislation should be introduced to control 
water drawal even from private sources in order 
to maintain the water table. This may include 
nationalisation of all water sources. 

20. The collection of solid waste and its use in 
composting and as an energy source should be 
made more efficient. Where possible the service 
should be transferred to private hands 

21. Laws relating to control of pollution must be 
strictly enforced. 

Energy 

22. Energy demands of urban areas must be 
anticipated and advance action taken to meet 
them and optimise energy use. 

23. Energy supply planning and pricing should 
be used to influence activity location. 

24. Land-use planning should be used as a 
means of reducing the energy need of the trans¬ 
port secTo.*". 

25. Development control rules and building 
bye-laws should be modified to ensure the con¬ 
struction of energy-efficient buildings. 

26. An integrated pricing and supply policy, 
covering all fuels, should be evolved to achieve 
equity and efficiency. 


27. A data base on energy use in urban areas 
should be built. 

Transport 

28. To ensure increase in city efficiency, land- 
use and transportation planning should be 
integrated. 

29. The bias towards personalised forms of 
transport must be corrected and mass transpor¬ 
tation encouraged. By allowing a wide variety of 
multi-purpose vehicles to operate, including 
luxury buses, the use of road space by private 
cars must be reduced. 

30. Short-term, affordable solutions rather 
than capital-intensive, long-term plans should 
be resorted to. This implies optimising the use 
of currently available transportation modes. 

31. Cycling and pedestrian facilities should be 
improved. 

32. Management of transportation at city level 
should be unified under a single authority. 

Urban Poverty 

33. The amelioration of urban poverty should 
be accorded the same priority as that given to 
rural poverty. 

34. Four lakh urban youth should be selected 
from poor households every year and trained in 
skills for which there is a demand. 

35. Self employment of the urban poor must be 
encouraged by an appropriate credit-support 
programme. 

36. Production and market support should be 
given to the self-employed urban poor 

37. City planning should be geared to providing 
shelter and sites for employment generation 
programmes. Local bodies should be supported 
in their efforts to create special employment 
facilities, including worksheds for tiny 
manufacturers. 

38. The shelter programme should be used to 
provide employment to the urban poor. 

39. Wage employment for the urban poor 


25 



should be provided through a programme for 
creation of such urban assets as water supply, 
drainage systems, land development, etc, 

40. The public distribution system should be 
strengthened to meet the consumption require¬ 
ments etc. 

41. Community development should be the 
strategy for the improvement of the living condi¬ 
tions of the poor and an Urban Community 
Agency should be set up at national level. 

Housing 

42. Housing policy must aim at increasing the 
supply of serviced land and low-cost shelter, 
improving and upgrading slums and conserving 
the existing housing stock. 

43. The State must facilitate housing and 
ensure access to basic inputs. It should not 
become a real-estate developer. 

44. The sites and services programme should 
be extended to cover the entire cross-section of 
society. Besides providing housing, the pro¬ 
gramme should be used to generate 
employment. 

45. Apart from providing access to land, the 
housing programme must also provide for 
finance, infrastructure development, and com¬ 
munity facilities. 

46. Inner city upgradation and housing repair 
must be encouraged. 

47. Public agencies in the housing sector 
should be restructured tor fulfilment of their 
new role as facilitators rather than providers of 
housing. 

48. Rent acts should be modified to limit tenancy 
protection to the poor and to the existing tenancies 
and to provide for annual revision of rents to 
reflect increases in the cost of living, the 
increases varying between residential and non- 
residential premises and houses above and 
below 80 square metres. 

Urban Form 

49. Low-rise, high-density devlopment 


should be the predominant built-form in urban 
India. 

50. Municipal regulations regarding min¬ 
imum plot sizes, buildable plot area, etc., 
should be amended, building envelopes dis- 
igned and building codes modified so that the 
desired built-form is achieved. 

51. Controlled streetscapes should be 
achieved through mandatory building lines 
and developing appropriate building 
envelopes. 

52. Public squares, parks, promenades and 
other nodal points of urban centres should be 
rehabilitated by restricting vehicle entry and 
ensuring controlled development. Civic land¬ 
marks should be treated as urban events 
which lend identity to a city neighbourhood 
and enhance civic pride. 

53. Land allocation must be consistently moni¬ 
tored and readjusted to ensure equitable city 
growth. 

Conservation 

54. Conservation should go beyond preserva¬ 
tion of monuments and encompass the whole 
built heritage. 

55. Rules and regulations should be amended 
to encourage conservation of the living 
environment. 

56. City planning must encourage conserva¬ 
tion of old city areas and not just development of 
new areas. 

57. Direct fiscal and other incentives should be 
offered as an encouragement to individuals to 
conserve places and sites. 

Spatial Planning 

58. There is a need to supploment economic 
development planning by inter-sectoral coordi¬ 
nation through the spatial planning process. 
Spatial planning at state and district level 
should concentrate on National Priority Cities, 
State Priority Cities and Spatial Priority Urbani¬ 
sation Regions with a view to bringing about 
integrated development. Therefore, multi-level 


26 



spatial planning at the national, state and dis¬ 
trict level is recommended. 

59. At the city level, to make planning more 
comprehensive, the local Government should 
adopt the three-fold development planning pro¬ 
cess, viz. Master Directive Plan for the entire 
city, and Execution Plan and Action Area Plans 
as programmes, taking into consideration major 
sectors of development such as employment, 
housing, transport, and the essential urban 
infrastructure. The execution plan should 
replace the present zonal development plan and 
should correspond in periodisation to national 
and state Five Year Plans, thus forming a capital 
investment plan as a budgetary tool and also as 
an instrument of coordination and implementa¬ 
tion of public and private sector projects. The 
action area plans should be used as a means of 
detailed planning. 


Finance 

60. The priority accorded to urbanisation in the 
Five Year Plan should be raised from the current 
share of about 4 per cent of the total to at least 8 
per cent. Half of this should be from the central 
sector. 

61 To ensure devolution of funds from the 
state governments to local bodies, there should 
be a consitutional provision for setting up quin¬ 
quennial State Finance Commissions. 

62. The tax base of local bodies must be 
strengthened. 

63. Four major banking institutions—a Metro¬ 
politan Cities Development Bank, National Hous¬ 
ing Bank, an Urban Infrastructure Development 
Bank and an Urban Small Business Develop¬ 
ment Bank should be set up. 

Managment 

64. The Planning Commission should have a 
full-time member incharge of urbanisation. 


65 The Urban Development Ministry should be 
nodal and should have divisions dealing with 
urbanisation and urban poverty alleviation. 


66. At the national level, there should be a 
National Urbanisation Council, with a counter¬ 
part State Urbanisation Council in each state. 
The councils will formulate urbanisation 
policies. 

67. To encourage citizens participation there 
should be an Indian Council for Citizens' Action, 
with counterparts at state and city level, 

68. The municipal administration should be 
restructured so that cities with a population of 
more than 5 lakhs have a two-tier administra¬ 
tion consisting of the city corportion and local 
councils 

69. The division of functions between the 
elected, deliberative wing and the executive 
wing of local bodies should be codified. The 
responsibility and accountability of each func¬ 
tionary must be made specific and the manage¬ 
ment of city services professionalised 

70. The supersession of local bodies should be 
the exception rather than the rule, and the hold¬ 
ing of elections for reconstituting a superseded 
local body within the specified period should be 
made mandatory and the municipal electoral 
process brought under the umbrella of the State 
Chief Electoral Officer. 

Information System 

71. Various data sources at national level 
should be modified to provide spatially disaggre¬ 
gated data. 

72. Access to data at source should be made 
easier. 

73. Two new data systems pertaining to land 
and the environment should be organised. 

74. The information system should be designed 
to facilitate decision making. 

75. The information system at local level 
should use data generated through the normal 
administrative processes. 

76. To facilitate urban planning location- 
specific information systems should be devised. 



77. Remote sensing should be used to monitor 78. Pilot projects for developing integrat 

changes in regional land-use and expansion of urban information systems should be launch 

urban areas. in selected major cities. 


28