Cities of Hope Skill Development and Youth Employment Generation Initiatives in Urban India Dr Chetan Vaidya June 2013
Skill development and youth employment generation
initiatives in urban India.
Professor Chetan Vaidya
Paper prepared for the Centre for Development and Enterprise,
commissioned for Cities of Hope project, June 2013.
This paper has only been edited lightly for clarity.
Skill development and youth employment generation initiatives in urban India.
Prof Chetan Vaidya, Director School of Planning and Architecture, New Delhi, India
In India, there is a strong realisation that its urban areas need to improve for the country to
achieve fast and sustained economic development. In this context, the Government of India has
incentivized urban reforms relating to urban governance, service delivery, financial management
and devolution of functions to urban local bodies, linked to grants for infrastructure investments
in the major. Despite the strong focus on urban reforms, the policy-makers are still struggling to
evolve mechanisms to dovetail fast population and geographic growth with economic
development. The Government’s employment generation programs were mostly focused in rural
areas and it plans to set up a National Urban Livelihood Mission. In this context, paper explains
the urbanization process, Government’s responses and components of the proposed Mission. It
also describes a NGO lead initiative on skill development and employment generation in
Ahmedabad city, Gujarat and suggests a way forward.
India has a large pool of urban population of with 377.1 million persons living in urban areas
(2011) and has the second highest urban population in the world. It is clear that urbanization is
inevitable in India and it the country needs to improve its urban infrastructure and governance to
improve productivity and create jobs for the poor. India has a three- tier governance system:
national, state and local governments. Local Governments are further divided as urban and rural.
Local governments are more or less under state governments. Moreover, economic development
and employment generation are state subjects responsibilities and don’t fall under not local
Following the present this introductory section, the second section of this paper describes the
urbanization process. by detailing It gives urban trends, status of infrastructure, institutional
structure, finances, and poverty in various dimensions, ease of doing business and assessed
impact of economic reforms on urbanization. The second section deals with government
programs. The Tthird section describes national and state level urban employment programs,
and Non- Government Organization (NGO) initiative in Ahmedabad, Gujarat. The final section
suggests a way forward.
In India, 377.1 million people in 2011(Pprovisional) lived in urban areas in 20111
proportion of urban population has increased from 27.8% in the year 2001 to 31.15% in 2011.
The decadal growth of urban population is 31.8% in 2001-11 as compared to 31.2% in 1991-
For the first time, the absolute increase in population was more in urban areas than that in rural
areas as per the 2011 Census (Provisional): . Tthe urban population increased by 90.98 million
during 2010-11, compared to which is higher than the corresponding increase of 90.47 million in
rural areas. For the first time, the absolute increase in population was more in urban areas than
that in rural areas as per the 2011 Census (Provisional). The level of urbaniszation in 2011 was
31.16 per cent compared to 27.8 per cent in 2001. Decadal growth rate during 2001-11 was 31.8
per cent, which was higher than corresponding figure of 31.5 per cent in for 1991-2001 (Table1).
The process of urbaniszation in India primarily takes is primarily place in large- cityties oriented.
Since the urban population base of India is very large, the growth rate of 2.76 per cent registered
during 2001-11 would translate into an annual addition of over 9 million people. The 2011
For the Census of India 2011, the definition of urban area is all places with municipal government and all other
places which have minimum population of 5,000; at least 75 per cent of the male main working population engaged
in non-agricultural pursuits; and a density of population of at least 400 persons per square km.. City is an urban area
with population with more than 1,00,000 persons.
Comment [ES1]: Check this – shouldn’t
it be 9 million as in next para?
census reports an addition of 2532 census towns in 2011, which is a phenomenal increase and
throws up a number of challenges in urban governance.
India, one of the fastest growing economies in the world, recorded an impressive growth of an
average of 8.5 to 9 per cent during the Tenth and Eleventh Plan period. Much of this growth is
attributed to the robust urban sector growth, which contributes over 60 per cent of the national
GDP. In the coming decades, the urban sector is expected to play a critical role in bringing about
growth of the entire economy and also sustaining it at high levels.
At the countrynational level, natural increase has been principal source of urban population
growth. The contribution of rural-urban migration ranges between 19 to 23 percent of the net
increase in urban population (Table 2).
Table 1: Urban India Population Trends: 2001-11
Item 2001 2011 (Provisional)
Urban Population (million) 285.0 377.10
% Urban to Total 27.80 31.15
No. of Towns 5161 7935
No. of Statutory Towns 3799 4041
Source: Census of India, 2001 and 2011
Increasing concentration of urban population in larger cities is one of the key features of urban
India. The number of cities and urban agglomerations over 1.0 million population, in 2001, was
35 and population share was over 37 percent. The salient aspects of urbanization in India in recent
a) The trend of concentration of urban population in large cities and agglomerations is
b) Slowing down of rate of urbanization during 1981-1991 and 1991-2001 as compared to
1971-1981 and 1961-1971; and
c) Large variations in patterns of urbanization in various states and cities.
Table 2: Composition of Population Growth 1961-2001
Item 1961-71 1971-81 1981-91 1991-2001
Urban population increase 30.18 49.45 56.45 67.81
Out of which
Natural Increase (in millions) 19.68 25.56 35.37 40.17
(65.21) (51.69) (62.66) (59.24)
Net Rural-Urban Migration (in millions) 5.91 9.83 12.76 14.32
(19.58) (19.88) (22.60) (21.12)
Residual Component (in millions) 4.59 14.06 8.32 13.32
(15.21) (28.43) (14.74) (19.64)
Source: Census of India, 1961 to 2001. The figures in parentheses are in percentages.
The urban share of Gross Domestic Product (GDP) in 1993-94 was 45.73 percent and the
corresponding figure increased to 52.02 percent in 2004-05. (Table3). In 2009-10, cities and
towns’ contribution to GDP was estimated contribution at about 62 per cent to GDP. It is clear
that urbanizsation is inevitable and India needs to improve its urban infrastructure and
governance to improve productivity and create jobs for the poor.
Projected Urban Population
The Register General of India has projected total and urban population rates offor India and for
its states. It is interesting to know that 67% of total population growth in India in next 25 years is
expected to take place in urban areas. Urban population is expected to increase from 286 million
in 2001 to 534 million in 2026 (38%) (Table4).
Table3: Urban Share of Gross Domestic Product in India: 1980-81 to 04-05
Year Percent share of urban GDP
Source: National Accounts Statistics, National Statistical Organization, 2000, 2006 and 2010.
Table 4: Projected Urban and Total Population in India – 2011, 2021 and 2026
Item 2001 2011 2021 2026
Total Population (million) 1028.61 1192.50 1339.74 1399.83
Urban Population (million) 286.12 357.94 432.61 534.80
Urban (%) 27.82 30.02 32.29 38.21
Total AEGR (%) 1.48 1.32 1.23 1.16
Urban AEGR(%) 2.24 2.07 2.50 1.89
Source: Population Projections for India, 2001-26, Registrar General of India, 2006
AEGR- Annual Exponential Growth Rate
Of the total increase in population, 50%, during the period, is likely to occur in seven less
developed states, namely, UP, MP, Rajasthan, Bihar, Chhattisgarh, and Jharkhand. But urban
growth is going to take place in states of U.P., Maharashtra, Tamil Nadu, and Gujarat and these
will contribute over 45% of urban growth over coming 25 years.
To understand the impact stress or influence of urbanization in various states, the states have
been grouped on according to basis percentage of urban population and share of urban
population in 2026 (Table5). The Ffirst group represents identified as highly urban states and
consists of A.P., Delhi, Gujarat, Haryana, Karnataka, M.P. Maharashtra, Punjab, T.N., West
Bengal and four other Union Territories (UTs). In this group, by 2026, about 51% of total
population will be urban and it will account for about 69% of total urban population. The
Ssecond group represents those is identified states characterized as average urban, and the states
consist of Chhattisgarh, J&K, Jharkhand, Kerala, Rajasthan, and U.P. and Uttaranchal. In this
group, 29% of total population will be urban and it will account for 24% of projected total urban
population. The third group is termed as low urban and covers states like Bihar, H.P., Orissa, and
North-East states. It will have 15% of population living in urban areas and accounting for only
7% of projected total population.
Urban India will continue to grow in the cities of concentrate in 1 million and above cities
inhabitants, as it is estimated that the number of these cities will increase from 35 to 61 during
2001-2026. Moreover, as per UN-Habitat (2008), eleven cities, namely, Ahmedabad, Bangalore,
Kolkata, Chennai, Hyderabad, Mumbai, Pune, Surat, Jaipur and Kanpur will have a population
of over 4.0 million in 2025 and these mega cities will have total population of 127 million
(which equals to over 24% of total urban population) (Table 6). It is pertinent to note that in the
Western Region, there will be four mega cities and the corresponding number in Northern and
Southern Regions will be three each. But in the Eastern Region, Kolkata will continue to be the
only Mega city.
Table 5: States Grouped According to Level of Urbanization in 2026
Per cent Share of Total
Urban States (mainly A.P., Delhi, Gujarat, Haryana, Karnataka, M.P.,
Maharashtra, Punjab, and T.N.) 50.9 68.6
Average Urban States (mainly Chhattisgarh, J&K, Jharkhand,
Rajastahn, Kerala, U.P., and Uttrakhand) 28.6 24.5
Low Urban States/UTs (mainly Bihar, H.P., Orissa, and NE) 15.5 6.9
Total 38.2 100.0
Note: Population Projections for India, 2001-26, Registrar General of India, 2006
Source: Vaidya, Chetan, 2009
In terms of the distribution of the urban population distribution, India will be mainly dominated
by the 11 states identified as the first group and of 11 eleven mega cities. This analysis has
important implication for future urban policy in the country.
Urbanization and Income Levels
The relationship between urbanization and income levels (per capita income) across the states of
India is depicted in Chart 1 which shows the relationship between level of state urbanization and
per capita income. Higher levels of per capita income are associated with higher levels of
urbanization, and the relationship is significant.
Status of urban infrastructure in water supply, sewerage and solid waste
There is tremendous pressure on civic urban infrastructure systems in areas like water supply,
sewerage and drainage, solid waste management, etc in urban areas. Recent data suggest that
water supply is available for 2.9 hours per day across cities and towns. The non-revenue water
that includes physical and revenue losses account for 40-60 percent of total water supply. About
30 to 50 percent households do not have sewerage connections and less than 20 percent of total
waste water is treated. Solid waste systems are severely stressed. The state of services reflects
the deterioration in the quality of city environments.
Comment [ES2]: Not sure what he
As per 54th
round of National Sample Survey, 70% of urban households reported being served by
tap and 21% by tube well or hand pump. 66% of urban households reported having their
principal source of water within their premises while 32% had it within 0.2 Km. 41% had sole
access to their principal source of drinking water and 59% were sharing a public source. As per
round of NSSO, 26% of households had no latrines, 35% were using septic tank and
22% were using sewerage system. Sewerage connections varied from 48% to 70%. It is
estimated that about 1, 15,000 MT of municipal solid waste is generated daily in the country. Per
capita waste generation in cities varies between 0.2 – 0.6 kg per day and it is increasing by 1.3%
per annum. Given the inadequate solid waste management in Indian Ccities, the Supreme Court
gave direction to the Ministry of Environment and Forest to prepare Solid Waste Management
(Handling) Rules 2000.
Chart 1: Per Capita Income and Urbanization Levels: States
Original Source: Census of India and Central Statistical Organization (HPEC, 2011)
Table 6: Projection of Population in Mega Cities in 2026 (in million)
2001 2025 Region
Mumbai 16.36 26.38 West
Ahmedabad 4.51 7.73 West
Pune 3.75 6.79 West
Surat 2.81 5.70 West
Chennai 6.42 10.12 South
Bangalore 5.68 9.71 South
Hyderabad 5.53 9.09 South
Delhi 12.79 22.49 North
Kanpur 2.69 4.60 North
Jaipur 2.32 4.29 North
Kolkata 13.21 20.56 East
Total 76.07 127.49
Source: Census of India, 2001 and World Cities, UN-Habitat, 2008-09.
Note: Mega city is defined as Cities with population above 4.0 million.
Focus of iImprovements in water supply and sewerage focus on is on creation ofcreating new
assets rather than management maintaining of existing assets. In order to bring about
improvements in delivery of municipal services, a need has been felt to develop National
Benchmarks in respect of basic services like water supply, sewerage, solid waste management
and storm water drainage. The Ministry of Urban Development (MoUD) has taken the initiative
of bringing out a Handbook of Service Level Benchmarks, in (2008), which provides fora
standardized framework for performance monitoring of in the four sectors mentioned above. It
is expected that the Handbook wouldill enable state level agencies and local service providers to
initiate a process of performance monitoring and evaluation against agreed targets, finally
resulting in achievement of service level benchmarks identified in the Handbook and shift focus
from asset creation to outcomes.
Most of the cities in India have been facing urban transport problems for last many years,
affecting the mobility of people and economic growth ofin the urban areas. These problems are
due to prevailing imbalance in modal split; inadequate transport infrastructure and its sub-
optimal use of it; no integration between land use and transport planning; and no improvement or
little improvement in city bus service, which encourage a shift to personalized modes. In view of
this, the Government of India approved the National Urban Transport Policy (NUTP) in April
2006. The Policy primarily focuses on the mobility of people and not the mobility of vehicles.
This will require the public transportation system to be more attractive to use, with one of the
biggest challenges for the . The challenge for improved bus transport is to provide good quality
service at an affordable price. It is important to evaluate alternative public transport technologies
in the context of city characteristics. The public transport options vary between low cost buses
to high cost rail metros. Moreover, the shape of a city is very important for selecting the
appropriate mode of transport and capacity building is a very important factor in introducing and
implementing a public transport system.
Two major problems in implementing the new public transportation system are: (i) absence of
linkage of metro rail system to the bus system; and (bii) lack of expertise in Bus Rapid Transport
system (BRTS). Many cities such as Indore, Baroda and Surat, allow private enterprises are
allowed to run the public transport system . Public entity invites bids for certain routes, after
successfully completing a tender-process. and then the private agency is selected to operate.
NUTP has brought the need for integrating urban transport with land-use planning.
Urban housing shortage
As per census 2011, total housing stock was 77.50 million in Urban India. Out of this, 66.17
million were permanent houses, 9.10 million were semi-permanent houses and remaining 2.23
million were temporary houses. As per aA Report of the Technical Group on Housing Shortage,
Comment [ES3]: What is this?
2012, testimated the housing shortage in Urban India in 2012 to be was 18.78 million (Table 7).,
of which Mmost of it was accounted by households living in congested houses and requiring
new houses (14.99 million).
The iInstitutional arrangement for municipal governance and urban service delivery mainly
comprises the Constitutional provisions, State Municipal Laws, role of State Finance
Commission (SFC) and Central Finance Commission (CFC), and status of ULBs and parastatals.
Table 7: Housing Shortage in Urban India in 2012 (millions)
Sl. No. Item Millions
1 Households living in non serviceable temporary housing 0.99
2 Households living in obsolescent houses 2.27
3 Households living in congested housing requiring new houses 14.99
4 Households in homeless conditions 0.53
Source: HUPA, 2012
Constitutional Provisions Prior to 1992
The Indian story of decentralization has known travelled a long journey over several
millenniums with a checkered history of centralization of several forms (Jha and Vaidya, 2011).
Earlier municipal legislations in India devolved executive powers to an appointed bureaucrat
making the elected head of the ULBs a mere figurative head in institutions of self-government.
Leanings towards centralization very much continued even after India ushered in an era of self-
rule in 1947. Institutions of urban local self-government continued to be an appendage to the
constitutionally autonomous state governments. The Constitution of India did not give
recognition to urban local self-government as decentralized autonomous entities. Local self-
government institutions were made creatures of subject to the state governments and were
devolved only such powers and functions that were delegated to them through specific local
government legislations enacted by the state legislatures. Role of central government is even now
limited to giving guidelines and suggestions, and indicating standards for performance of urban
Decentralization in terms of devolution was still a far cry; being creatures of state governments,
urban local governments were subjected to substantial control by the state governments. Urban
governance was very represented a system of centralized, largely because of elaborate control
system applied by the used by state governments. Institutions of urban self-governance
substantially declined over the years due to, among other things, undefined role responsibilities
which led to systematic erosion of the in municipal functionsal domain, inadequate resource
base, a weak executive system and pervasive state control (Jha, 1993).
The lack of clearly defined responsibilities for Undefined role of municipal authorities was
manifested in infringements by considerable state government encroachments into municipal
functions, and the creation of coming into being of parastatals and specific purpose authorities
set up in the spheres of water supply, sewerage and drainage, slum improvement, urban planning
and development. This happened under the guise on the plea that of the traditional municipal
authorities do not being sufficiently equipped with have requisite resources to do it.effectuate
these complicated and challenging tasks. No attempt was made to inject the required elements of
institutional capacity development into the urban local bodies themselves. On the resources front,
however, despite an increasing demand for services due to urbanization and urban growth, the
local resource base started shrinking. The executive system, especially in the municipal
corporations which are the largest and the most autonomous forms of municipal authorities,
became highly fragmented as it was based ondue to a separation of executive powers and
functions (this is the case even now in quite a number of states). Whereas executive powers vest
in the Council and its executive committees, executive functions are performed by the appointed
Commissioner. Substantive executive powers enjoyed by an appointed executive, rather than by
an elected local representative, led to bureaucratic control and hence erosion in local democracy
and self-rule. Barring a handful of states where executive powers are given to the elected head of
local government, this is the practice in other states even now. Obviously, it seems to be an
anathema to the institutions of self-government.
An elaborate state control on the day-to-day functioning of municipal authorities was crippling
them. These powers controls were frequently exercised through inspection, calling of records and
giving directions for performing civic functions. Besides these, the state governments also
supervised possessed overwhelming powers of supervision and control in matters of
appointment, approval of contracts and estimates above a predetermined amount, sanctioning of
new posts, and framing of bye-laws and rules. In the fiscal matters, control related to deciding
tax rates and expenditures incurred. Despite being the units of self-government, it was incredible
that the municipal authorities did not have powers to approve their own budgets and decide the
tax rates. Even the municipal corporations were required to obtain state approval of expenditures
beyond certain limits.
The most drastic mechanism of control was applied by an act of supersession without
reconstituting the Council through fresh election for years together. Due to this, a large number
of municipal councils came under prolonged suspension. Even the historical Madras Municipal
Corporation which is the first municipal body to be constituted in this country (in 1688), became
the first municipal authority with the longest spell of supersession, i.e, from 1974 to 1994. As of
1989, as many as 39 out of 71 Municipal Corporations were superseded in different states.
74th Constitution Amendment Act, 1992
The act decentralized It was realized that planning, plan implementation, development processes
and authority need to be decentralized to sub-national and local levels. The Constitution was,
therefore, amended in 1992 through the enactment of the Constitution (Seventy-fourth
Amendment) Act (CAA), (1992) as a culmination of prolonged debate in the post-independent
India for devising a democratic and empowered system of municipal government. The
amendment received assent of the President of India in 1993. The state governments were
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required to bring their municipal laws in conformity with the provisions of Seventy-fourth
Amendment by April 1994.
CAA gave constitutional recognition to the local governments. It envisages ushering in of a
regime of empowered and strengthened urban governance in the country. Through this
amendment, the ULBs are guaranteed constitutional right to exist; they can no longer be kept
superseded indefinitely. It appended a new Schedule of municipal functions (Twelfth Schedule)
and provides for intra-city decentralization in cities with a population of of more than three lakh
hundred thousand population , for bringing local governance nearest to the door steps of the
citizens. It provides for the constitution of State Finance Commissions (SFCs) every five years
to review local finances and financial administration by the local governments every five years
and suggests fiscal transfers to the local governments both urban and rural. By amending the
terms of reference of the Central Finance Commission, the CAA required it to suggest transfers
to local governments as well. Devolution of additional tax authority to the local governments for
addressing the existing mismatch between functions and sources of revenue was, however, left to
the discretion of the SFC.
Achievements of 74th Amendment
Looking back at the CAA and its efficacy in strengthening the ULBs, it has been at most a
qualified success. It has definitely led to empowerment of weaker sections of the society, has
largely rationalized the transfer system, prevented prolonged super session of the ULBs and has
qualitatively changed the local political process. It has, however, not yet succeeded in putting in
place the instrumentalities conceived in the CAA for institution building; it has not yet
contributed to institutional capacity development of the ULBs.
The study of implementation of 74th
CAA in various states shows that some states have
performed better than others. An important observation is that, while there has been full
compliance in respect of provisions, such as constitution of three types of ULBs, reservation of
seats, and constitution of SFC, the same cannot be said for other provisions, namely constitution
of Wards Committees, District Planning Committees (DPCs) and Metropolitan Planning
Many states have not transferred functions, funds and functionaries to ULBs. Revenue powers of
ULBs are often not in consonance. There is also no consistency about term, powers and method
of election of Mayors. In most states, Mayors do not have executive powers as they are vested
with the Commissioners. Implementation of 74th
CAA needs strengthening.
Two reasons explain not-so-effective impact of the CAA. First, dilution in the CAA’s the
provisions of the CAA that relate to institution building resulted in discretion to a failure of the
State Governments to ignoreng putting in place to put in place the required structures and
processes for effective urban governance and management systems. Second, even mandatory
provisions of the Indian Constitution are not yet implemented, largely due to lack of will on part
of State Governments.
State Municipal Laws
Municipal laws in India are very old and often do not enable obstruct ULBs from to
implementing reforms. Therefore, the Government of India (GOI) developed a Model Municipal
Law (MML) in 2003 to guide States to enact municipal legislations. The basic objectives of the
MML are to implement the provisions of the 74th
CAA in totality to for empowerment of the
ULBs, and to provide the legislative framework for implementation of the Ministry of Urban
Development’s urban sector reform agenda. This initiative is expected not only to enhance the
capacities of ULBs to leverage public funds for development of urban sector, but will also help
in creating an environment in which ULBs can play their role more effectively and ensure better
service delivery. Four states, namely Rajasthan, Bihar, Orissa and Sikkim have prepared their
municipal laws on lines of MML and many others are in process of amending their laws. The
Rajasthan Municipalities Act 2009 has introduced some very innovative features that should help
to empower ULBs in the State.
ULBs and Parastatals
The consequences of The unfinished decentralization agenda means that there are are different
institutional frameworks in across Indian states in India for network services, with –
responsibilities are divided being divided between ULB, state department and state or city level
utility board. Three broad institutional frameworks are discernible in states in India with regard
to water supply and sewerage services. First are the states where the entire system is with a
department or a parastatal of the State Government; second, where the ULBs themselves handle
the entire activity and, third, as in some large cities, where exclusive water supply and sewerage
boards have been set up for the city (Table 8). Irrespective of the institutional framework, the
failure of the public sector to provide adequate service delivery haves been ascribed to public
monopoly, organizational inefficiency, technical flaws in the form of high leakages, lack of
preventive maintenance, unaccounted water as well as over staffing and lack of autonomy. The
state governments’ inability to clearly assign the functions to municipalities has resulted in
overlap of responsibilities and no accountability to citizens for service delivery.
City planning function has not been handed over to ULBs in many states. These state level
organizsations are often not accountable to ULBs. Though 74th
CAA expects that major civic
functions should be transferred to ULBs, many small and medium sized ULBs are not able in
position to manage water supply, sanitation and town planning functions. The Government of
Orissa plans to set up a corporatized entity for the delivery of water supply and sewerage
services in Bhubaneswar city.
SFCS and CFC
As per the provisions of 74th
CAA, state governments have set up SFCs. Most SFCs have
formulated the fiscal packages without access to a clear directive on the functional jurisdiction of
municipalities. Obscurity Absence of clarity in respect of the functional domain of municipalities
constitutes a serious gap in the functioning of the SFCs. The Commissions have been reviewing
the financial position of the rural and urban local bodies and has suggestinged ways and means to
devolve the finances by the State Governments to ULBs. However, estimating the resource gap
and absence of expenditure norms for various services are the important areas which need to be
addressed by the commission while devolving funds to the ULBs.
Table 8: Institutional Framework for Delivery of Services in Selected Cities
Services provided by
Ahmedabad All services - - -
SWM, Roads, Street
Lighting, Drainage, etc.
and Sewerage2 Town Planning -
SWM, Roads, Street
Lighting, Drainage, etc.
---- Town Planning
Source: Vaidya, C., 2009
With amendment of Article 280 in 1992, the CFCs have to address the issue of municipal
finances. The Eleventh CFC recommended, supplementary support of Rs.20, 000 million for
improving the core services of municipalities, and creation of appropriate databases and
standardization of the budgetary classification and practices. The Twelfth CFC provided Rs.
50,000 million annually for ULBs as grant-in-aid and 50 percent of this grant is earmarked for
solid waste management schemes4
. As per the 13th
CFC Report, accepted by GOI in February
2010, the grants to local bodies will be linked to a divisible pool rather than a system whereby
ad-hoc grants are given by last three CFCs. Total grants to ULBs over five years have been
increased from Rs. 45000 million in 2005-09 to Rs. 231,110 million in 2010-2015. Thus, total
grants will increase by nearly 4- four times. Part of the grants to ULBs will be linked to
performance (Table 9).
Weak Staff Capacity
Most ULBs in India do not have the capacity to promote cities as ‘engines of growth’. The local
agencies have weak institutional capacity to plan spatial, social and economic development,;
have unstable revenue streams,; and low capacity to plan, mobilize resources and implement
urban infrastructure projects. There is a need for strengthening of ULBs to play the a pivotal role
in achieving national economic growth.
Table 9: Central Finance Commission Allocations to Local Bodies (Rs. in Million)
Commission Years Allocation to
% of Divisible
Pool to Local
Tenth 1994-99 53,800 10,000 18.58 1.38
Eleventh 2000-2004 100,000 20,000 20.0 0.78
1US$is equal Rs. 55.
Twelfth 2005-09 250,000 50,000 20.0 1.24
Thirteenth 2010-15 875,190 231,110 26.40 2.28
Source: Prasad, D. R. and Chary, V. S., 2010
MPC and DPC
The ULBs are not in charge of planning for ‘economic development and social justice’, nor to
and implementation of city/town development plans due to the failure of state governments to
amend State Acts. and, aAlso, Metropolitan Planning Committees (MPCs) and District Planning
Committees (DPCs) have not been assigned a clear role in preparation of regional and urban
plans. The 74th CAA has mandated the State Governments to constitute MPCs and DPCs, which
are responsible for the preparation of Metropolitan Plan and District Development Plan.
However, the State T&CP Act and Development Authorities Acts have not been amended so as
to incorporate the provisions for preparation of Metropolitan Plans and District Development
Plans. The existing statutory authorities like planning and development authorities have to
realign the existing institutional framework.
While Tthe Constitution of India specifies the taxes to be divided between the central and state
governments, but it does not specify the revenue base for ULBs. Furthermore, the 74th
doesn’t specify is not specific about the types of taxes ULBs should have, and but on the other
hand the powers for determining the revenue base of ULBs rests with the state governments.
The resource base of ULBs typically consists of their own resources (tax and non-tax revenues),;
shared revenues,; state grants,; and loans from state governments and market borrowings. In
spite of the variations in the figures compiled by different agencies, and despite being short of
for want of a uniform accounting and reporting framework, it is evident that municipal revenues
have generally had limited buoyancy.
There is often a mismatch between functional responsibilities and resource generation capacity
of local governments. Therefore, the lower tiers of governance would depend on the higher tier
for actual devolution.
With the abolition of Octroi by most States, Property Tax is the most important source of
revenue for local governments. There have been substantial reforms in Property Tax
administration in recent years. Earlier ‘Annual Rental Value (ARV) was the basis of levy of this
tax. This mode of assessment had many drawbacks—the manner of assessment was opaque and
gave a lot of discretion to assessing officials and it was inelastic and non-buoyant. The
Government of India formulated and circulated the Guidelines for Property Tax Reforms, in
1998. ULBs need to improve legal basis of property assessment as well as improve the tax
administration. Several states have introduced unit area method of property tax assessment.
User charges are most the important sources of non-tax revenues for ULBs. There has been a
tendency to charge for various services at rates that are much lower than the actual costs. This
has led to poor cost recovery, poor maintenance and inadequate investments in the infrastructure.
ULBs opt for management innovations to improve efficiency and strengthen the municipal
revenue base. These innovations include improved billing and collection;, rationalization of
service charges,; simplification of the tax assessment system,; computerization of records,;
improved accounting and financial management systems,; intensive communication with public,;
project specific contribution,; outsourcing,; enforcement,; State Government guidelines,; etc. The
most important lesson learned is that the municipal resource mobilization process requires the
strong commitment and unwavering support of elected leaders as well as of administrators.
Successful efforts have been made by the Indore Municipal Corporation to mobilize resources.
Own revenues of mMunicipalities’ own revenues are supplemented by state transfers. During
the period 1997/98 to 2001/02, state transfers to municipalities were characterized by a high
degree of fluctuation. Transfers to municipalities have in the past been marked by
unpredictability and instability. In addition, there is no lack of distinction between capital
account and revenue account transfers and further confusion that is caused by plan and non-plan
transfers on many heads cause even more confusion.
Rapid urbanization in India has led to a tremendous pressure on urban infrastructure systems like
water supply, sewerage and drainage, solid waste management, parks and open spaces, transport,
The High Powered Expert Committee (HPEC) on Urban Infrastructure chaired by Dr. Isher
Ahluwalia initiated its work June 2008 and submitted its report in March 2011. It has estimated
investment requirement for urban services in the country over 2012-31 at Rs. 39200 billion (US$
871.11 billion) at 2009-10 prices (Table 10). The operation and maintenance of old and new
assets will account for half of total costs. The report argues that the challenge of managing
urbanizsation will have to be addressed through a combination of increased investment,
strengthening the framework of governance, and comprehensive capacity building program at all
levels. Most of investments are is required in urban roads and water supply. Present capital
expenditure on urban infrastructure is low. To meet the HPEC projections, by 2021-22, the total
urban infrastructure expenditure will be almost nearly three times as much as in 2011-12.
Innovative Financing and PPP
Government of India (GOI) is facilitating the cities and states in developing innovative financing
mechanisms such as mobilizing market-based funds, land-based sources and public-private-
The Ahmedabad Municipal Corporation was the first ULB to access the capital market in
January 1998. It issued Rs.1000 million in bonds. This was a remarkable achievement since it
was the first municipal bond issued in India without a state guarantee and represented the first
step toward a fully market-based system of local government finance. Several ULBs and utility
organizations have issued bonds thereafter that so far have mobilized over Rs.12399 million
through taxable bonds, tax-free bonds and pooled financing (Table11). The Tamil Nadu Water
and Sanitation Pooled Fund issued tax-free bonds under Pooled Finance Development Fund In
September 2010. The issue was of Rs. 83.19 crore at 7.5% annual interest for 10 year period. The
bond market found the issue to have attractive fair price.
Table10: Investment estimates by HPEC (Rs. In Million)
(for the period 2012-2031)
Water Supply 3209080
Storm Water Drains 1910310
Urban Roads 17289410
Mass Transit 4494260
Street Lighting 185800
Traffic Support Infrastructure 979850
Renewal and redevelopment 4089550
Other sectors 3098150
Source: HPEC, 2011
Ratings of local governments establish a transparent credit record, and a reference framework for
current and future performance of local finances and debt management. In the last 12 years, all
major rating agencies have provided ratings for municipal and municipal enterprise bond
offerings. More than 100 ULBs had received ratings.
Table 11: Municipal Bonds in India
S. No. Type of Bond Amount (Rs. in Million)
1. Taxable bonds 4,450
2. Tax-free bonds 6,495
3. Pooled finance 1,454
Source: Vaidya, Chetan and Vaidya, Hitesh, 2008 (updated up to September 2010).
Land as a Resource for Financing
Several land based financing methods like higher Floor Space Index (FSI), Transferable
Development Rights (TDR), Impact Fee, Area Linked Development Charge, External
Development Charge, Betterment Levy, etc. have been used as tools for financing urban
development in India. Land as a resource had a very dominating role during 60’s and 70’s. The
dominant view was - “Large-scale advance acquisition of land is by far the best and perhaps the
only way to put an end to speculation in land and to capture subsequent increases in land values.”
But this method of land value capture seems to be neither adequate nor feasible. Infrastructure
increases the land value and therefore there is a need to capture it. Increase in land value in turn
will lead to an Increment Tax. Examples are Town Planning Schemes in Gujarat and
Maharashtra. The other approaches include additional FSI and TDRs.
As a response to the lack of access to finance, and restriction on recruiting new personnel, etc.,
many ULBs have outsourced various tasks to other agencies that aim to increase access to these
services. A number of public private partnership (PPP) options have emerged. There are many
examples of PPP in solid waste management. In Hyderabad and Surat, private contractors are
engaged to clean main roads and markets. As far as PPP options for urban infrastructure are
concerned, the initial focus of new investments on PPP of water supply projects was on provision
of bulk supply. However, BOT projects often did not address problems of existing water supply
and sanitation systems such as high levels of water usage that remain unaccounted for water,
high expenditure on energy and low cost recovery. The focus is slowly shifting to improveding
management of existing systems. As part of the World Bank funded Karnataka Urban Water
Supply Improvement Project, demonstration zones have been identified in the three
cities Belgaum, Gulbarga, Hubli-Dharwad and entrusted on a performance based contract to a
Private Operator Consultant for carrying out water supply improvements in the zones with the
prime objective of demonstrating provision of 24/7 water supply. Mysore city in Karnataka has
signed management contracts with a private company for delivery of services. It may be
mentioned here that water supply tariffs in India are low and base data of existing water supply
systems are missing. Unless these issues are taken care off it will not be possible to undertake
PPP projects in urban water supply and sanitation sector.
Cities have been engines of economic growth but they harbor a significant number of poor
whose and the living conditions are far from satisfactory. Urban poor constitute between 15 to
30 percent of total population in urban India.
There is robust economic growth at the national level;, while however the percentage of urban
poor continues to be high. The All-India head count ratio for urban poverty has declined by 4.8
per cent points from 25.7 to 20.9 per cent during 2004 – 5 to 2009 - 10 (Table 12). It may be
noted that corresponding figure for rural areas declined from 41.8 to 33.8 per cent. Thus lLevels
of poverty in rural areas is therefore about 13 per cent higher than those in urban areas.
Table 12: Percentage of Below Poverty Line in Rural and Urban Areas:
2004-05 and 2009-10
Item 2004-05 2009-10
Urban 25.7 20.9
Rural 41.8 33.8
All-India 37.2 29.8
Source: Planning Commission, March 2012 (a)
The Ttotal number of urban poor was 76.47 million in 2009-10. The uUrban poverty is high in
states of Uttar Pradesh, Bihar, West Bengal and Rajasthan (Table 13).
Urban poverty is multi-dimensional (HUPA, 2013). It includes inadequate access to shelter,;
basic services like water supply and sanitation,; education,; health,; and livelihood opportunities.
The bulk of urban poor find their find their livelihood in the informal sector – 94 to 98 percent.
There is a strong the need to assess various dimensions of urban poverty, including quality of
habitat and access to services, calorie in-take, among others. This would help in framing policies
and programs to address various dimensions of urban poverty, and achieve inclusive service
delivery. Also, it would help and addressing large inequities in access to opportunities and
services across neighborhoods and economic and social groups, issues which are critical to slum
In this regard, an interesting study has been carried out the National Commission for Enterprises
in the Unorganized Sector (Sengupta, A, Kannan, K.P. and Raveendran, G. 2011) of. This study
talks about two sides of India – a shining and resurgent one and a suffering yet labouring one. It
breaks the popular myth about them both spheres and gives one an eye-opening insight about the
poor in terms of ‘who they are, how many they are and how they live’. Some of thThose insights
that would be are useful to all those attempting to make our cities better places to live in.
Table 13: Number & Percentage of Below Poverty Line in Urban India by Major States-
Name of the States % of Total
Number of persons
Uttar Pradesh 31.7 13.73
West Bengal 22.0 6.25
Andhra Pradesh 17.7 4.87
Bihar 39.4 4.48
Maharashtra 18.3 9.09
Gujarat 17.9 4.46
Karnataka 19.6 4.49
Madhya Pradesh 22.9 4.49
Rajasthan 19.9 3.32
Others 18.4 21.29
All India 20.9 76.47
Source: Planning Commission, March 2012 (a)
Characteristics of urban poor across different sizes of urban centres
It has been observed now, that large cities exhibit distinctly higher demographic growth, better
infrastructure facilities, and higher levels of education and lower poverty ratios, when compared
to the lower order towns. There has been a general deceleration in urban growth in all size
categories, surprisingly during the 1990s – the decade of structural adjustment and of
administrative and economic reforms. Urban structure has become more and more top heavy due
to higher demographic growth in (and around) larger cities. These cities have been able to attract
private investment from the national as well as , as also the global capital market, particularly
during the past decade and a half, resulting in a significantly higher level and quality of
infrastructure facilities. Indeed, better coverage of the population through access to primary,
secondary and other schooling and technical training facilities are reflected in a higher level of
education in these cities.
The million plus cities, classified as larger cities, have around 14 per cent of their population
living below the poverty line in 1999-2000 compared to the figure of 18 per cent in 1993-94. The
medium category cities/towns, with a population between 50,000 and 1 million, reported poverty
levels of 28 per cent in 1993-94, which has gone down to 20 per cent in 1999-2000. The
corresponding figures in small towns, those with 50,000 or less people, are as high as 33 per cent
and 24 per cent respectively, slightly higher than even in rural areas. There are, thus, reasons to
be concerned also about the poverty situation in the lower categories of urban settlements, as
much as in rural areas. (Kundu and Sarangi, 2007)
One would expect a lower incidence of poverty in larger cities than in smaller towns, as
employment and other economic opportunities are more in the former. These cities provide better
social and physical infrastructure, including educational facilities, which results in higher factor
productivity. Correspondingly, returns to education are likely to be higher in large cities than in
small towns. Persons in regular and self-employment understandably are better placed than the
casual workers. A large majority among the former are expected to be above the poverty line. It
is also argued that migration, in general, is linked to expected future social and economic pay-
offs in comparison with those in the present. Hence, a person is likely to have a greater chance of
escaping poverty after migration if it is his/her free choice. The motivation to send out a migrant
would be stronger for a poor than a rich household although the capacity to “afford” migration is
higher in case of the latter. (Kundu and Sarangi, 2007)
Relation between size of cities and urban poverty
Analysis of the percentage of poorverty in different classes of urban areas reveals that it has
reduced in all sizes of the urban areas (Table 14). It is generally between 20 to 21 per cent during
1987-88 to 1999-2000. A recent research on urban inequalities has also brought out that there are
large differences in metros and non-metros at national and state levels (Mahdevia, D. and
Table 14: Percentage Poor in Different Size Classes of Cities/Towns
City/Town Size 1987-88 1993-94 1993-94 1999-2000
Large towns/cities 35.2 22.6 18.4 14.2
Medium cities/towns 40.5 32.2 27.6 20.4
Small towns 45.3 36.2 33.2 24.2
All urban centers 41.2 31.4 27.4 19.9
Rural areas 47.6 41.0 35.7 23.9
Source: Kundu and Sarangi (2007)
Relation between migration and urban poverty
A cross classification of migration data across consumption expenditure categories reveals that at
the macro level, economic deprivation is less of a factor in migration of men (migration of
women being determined largely by socio-cultural factors), both in rural and urban areas (Table
In urban areas, the migration rate is as high as 43.3% in the category with the highest monthly
per capita expenditure (MPCE), which goes down systematically, the rate being as low as 10.5%
in the lowest class in urban areas (Table 15).
The migration pattern reveals that poverty is not the key factor behind seasonal migration,
although mobility is not very high among the poor when compared to middle class households.
The bottom 40 per cent of the country’s urban population accounts for only 29 per cent of the
total seasonal migrants. In contrast, the share of the middle income group is 29 per cent, much
above its population share. All these suggest that even such short-term migration opportunities in
urban areas are being cornered by the well-off sections. The poorest households are those that
have one or a few of their members reporting immigration status. However, when all the
members are in-migrants, the households are observed to belong to economically better-off
strata. These households are in fact more affluent than the non-migrant households as the
incidence of poverty here is the lowest. A macro overview of the migration pattern reveals that
economic deprivation is not the most critical factor in migration decisions in contemporary
times. One observes that both poor and rich households report out-migration, although the
reasons for sending out their family members and the nature of jobs sought by them are different.
The probability of being poor is much less in large cities compared to middle level towns, the
same being the case ofor middle level towns vis-à-vis the small towns. This pattern is observed
not only in case of the two types of migrants but also the non-migrants. (Kundu and Sarangi,
Table 15: Migration Rate for Rural and Urban Males in Different MPCE Classes, 1999-
MPCE Classes (Rs)
Per Cent Migrants
MPCE Classes (Rs)
Per Cent Migrants
0-225 4.3 0-300 10.5
225-255 3.7 300-350 13.0
255-300 4.0 350-425 13.4
300-340 4.6 425-500 19.7
340-380 4.9 500-575 21.1
380-420 5.8 575-665 23.9
420-470 6.3 665-775 27.8
470-525 7.3 775-915 30.7
525-615 8.6 915-1120 37.1
615-775 10.7 1120-1500 41.2
775-950 14.5 1500-1925 38.8
950 and above 23.3 1925 and above 43.3
All 6.9 All 25.7
Original Source: NSS Report No 470: Migration in India, 1999-2000 (Kundu, A, 2011)
Employment opportunities among the poor
Poverty among the salaried urban poor persons or those in regular employment is the lowest. The
next lowest figure is that of unemployed persons. This is because these persons can afford to stay
out of the labour market and can wait for appropriate jobs (due to assets, savings, etc). Casual
workers report a very high level of poverty. The highest poverty figure is recorded by the
persons classified as others, comprising those outside the labour force. As large sections of these
people are children and aged dependents, their poverty figures are very high. The households that
have a large number of dependents have a greater risk of falling below the poverty line.
In the context of variation in the levels of poverty among different groups of population, persons
in regular employment report the least poverty, the highest being among casual workers. There is
however no significant difference in the incidence of poverty between the self-employed and
“others”, the latter comprising primarily non-workers or dependents.
The age of a person understandably reduces the incidence of poverty among regular workers and
self-employed but that is not so for casual workers or the unemployed. Furthermore, the larger
the size of the household, the higher is the probability of its members being poor. The pattern
remains similar for all employment categories. With regard to the nature of employment, it is
noted that for regular workers, the risk of falling below the poverty line is very low in these
cities. But that happens to be low in lower order cities and towns as well. The ordering in terms
of poverty probability from lowest to the highest, thus, works out to be regular, self-employed,
unemployed and casual workers. (Kundu and Sarangi, 2007)
Variation in education amongst the poor
The level of educational attainment emerges as the single most significant factor impacting on
poverty. The incidence of poverty (as also the probability of being poor) declines with the level
of education. This is true for both migrant and non-migrants among the urban poor and across all
size classes of urban centers. The probability of a person being poor is low in a large city
compared to any other urban centre, irrespective of the migration status, age, number of
subsidiary activities undertaken, etc. Thus one may infer that large cities have greater capacity of
poverty alleviation for its residents or in-migrants. However, one may also argue that large cities
have become less hospitable and less accommodating for the poor, reducing the absorption of
economically dispossessed migrants and consequently, report a much lower poverty risk when
compared to smaller towns.
Work and workplaces of the poor
In 2004-05, in the urban areas, about 43% people were engaged in non-agricultural activities
and were regular salaried workers. In the non-agricultural sector, the proportion of casual
workers declined from 16% to 12%. The number of self- employed workers increased to 43% for
men and 45% for women. It may be noted that while men are largely own account workers,
nearly 18% women are unpaid family workers.
The conventional idea of a workplace is the office, factory or an institution; in the urban areas of
our country, in 2004-05 only about 60% of the non-agricultural work force and as little as 40%
of the women worked in the conventional sense of a designated work place. While 43% men
worked in the conventional employer’s enterprise, nearly 32% women did so. The existence of
‘unconventional workplaces’ is expectedly more common among the self-employed, who
operate in open spaces such as streets, construction sites etc. Mostly enterprises in the
unorganized sector are not registered under any authority and therefore do not ensure any legal
recognition. The lack of a clearly identifiable place of work, particularly among women adds to
their denial of an assured amount of income. For example, in Ahmedabad city, poor women who
lived in dilapidated structures on streets said that no one was willing to give them piece-rated
garment work because of their dismal living conditions. In spite of being equipped with sewing
skills they had to resort to casual work like waste picking. This is a very common story in many
urban areas of the country.
Employment and unemployment in India
Level of employment and unemployment in urban India is a debatable issue. The proportion
employed person (15 + Aged) in the population of metropolitan cities a decline except Mumbai
Table 16: Number of usually employed per 1000 persons ages 15 years & above during
1993-94, 1999-2000 and 2004-05 in four Metros
Item Male Female
A Metropolitan cities
Delhi 714 743 796 112 147 132
Kolkata 751 780 803 190 187 183
Mumbai 786 753 773 267 174 221
Chennai 749 764 773 168 260 227
B All class 1 cities 762 745 767 198 176 181
C Urban India 763 752 768 227 197 223
Source: Sharma and Krishna, 2007
It is clear that the newly emerged metros like Bangalore, Hyderabad, Ahmedabad, Jaipur, Surat,
etc., occupy center state in employment generation (Table 17). Cost of serviced land compared to
level of infrastructure is relatively low in these cities and state governments are able to provide
the necessary support. Therefore these cities have been able to attract investments and generate
employment. Employed persons can be categorized into three broad groups, namely, self –
employed,; regular wage/salaried employees; and casual labour. Table 18 shows per thousand
distribution of usually employed (aged 15 years and above) over three points of time. Share of
self – employed workers increased, share of wage/salaried workers declined and share of casual
Table17: Number of usually employed (PS+SS) per 1000 persons ages 15 years & above
during 1993-94, 1999-2000 and 2004-05 in select million plus Cities/Towns
S.No. Other million +
Bangalore 841 747 763 202 232 162
Hyderabad 770 682 750 190 155 164
Ahmedabad 795 777 764 214 204 196
Jaipur 766 701 720 377 108 128
Surat 876 765 773 182 55 231
Pune 712 726 699 291 220 261
Bhopal 782 722 685 151 151 176
Indore 835 761 753 283 199 235
Kanpur 776 699 558 77 154 131
Agra 833 806 n. a. 147 106 n. a.
Source: Same as Table 16
Table 18: Number of usually employed by status per 1000 persons (aged 15 years and
above) during 1993 – 94, 1999 – 2000 and 2004 – 05 in Urban India.
Type of Employment Male Female
Self Employment 449 415 415 471 361 167
407 418 425 452 335 213
Casual Labor 144 166 160 446 293 261
Source: Same as Table 16
The Uunemployment rate is taken as the number of persons unemployed per thousand persons in
the labour force (employed and unemployed taken together). The unemployment rate in urban
India declined from 4.0 to 3.8 during 1993 – 94 to 2004 – 05. The corresponding figure for
females, increased from 6.3 to 7.0 per cent (Table 19):.
The unemployment status was high in Delhi, Kolkata, Pune, and Bhopal for males, and in
Kolkata, Delhi, Bangalore and Hyderabad for females.
It is needless to say that the employment and unemployment situation does not reflect the level
of poverty. Since a large number of urban population is underemployed in unorganized sector.
Table 19: Unemployment rates (per 1000 persons/person-days in the labour force) of
persons aged 15 years and above as per usual activity status (adj) for each city/size class of
town during 1993 – 94, 1999 – 2000 and 2004 – 05.
City/size class Male Female
d (1999 –
(1993 – 94)
d (1999 –
A. Metropolitan cities
Delhi 49 24 9 59 33 64
Mumbai 31 68 53 53 117 71
Kolkata 53 36 50 104 70 149
Chennai 30 45 53 23 41 117
B. Other million plus cities Class 1 cities
Bangalore 12 29 38 137 80 134
Hyderabad 33 64 20 59 38 6
Ahmedabad 27 10 44 27 10 137
Surat 2 13 52 11 0 29
Jaipur 27 33 3 10 18 8
Pune 62 25 48 10 31 61
Bhopal 56 39 46 0 44 74
Indore 16 65 44 0 0 37
Kanpur 53 89 54 49 6 30
All class 1 cities 34 47 38 43 64 86
Urban India 38 44 40 70 57 63
Source: Same as Table 16
Ease of doing business
The Ttime required for obtaining various approvals setting up and managing a business is
perceived as very long in Indian cities. Setting up of new business enterprises is hindered by
legal, administrative and bureaucratic bottlenecks, which come in the way of securing a license
or getting a property registered, resulting in high cost and delays in starting a business or running
it efficiently. In this context, a study was carried out on identifying reforms to ease doing
business in Indian cities (Kundu, 2011). It was on primary research, which tried to establish ease
of doing business empirically by ranking cities on a scale, akin to the Doing Business global
report (World Bank 2007), for parameters of property registration and building permit sanction.
The study covers ten cities each in five regions in the country. The findings of the study indicate
that business in most of the Indian cities is affected by cumbersome procedures, particularly in
the context of obtaining construction license.
Many agencies are actively engaged in the process of reforming regulatory procedures and a
number of innovative practices have been developed within the country. For example, with the
introduction of computerized system of registration, the time taken to register property has come
down drastically in many cities. Similarly, adoption of computer-aided evaluation and single
window system for building plan approval has helped in reducing red tape in some cities. These
practices need to be further improved and widely disseminated to bring about a paradigm shift in
the existing regulatory regime. This would increase private investments and provide employment
to the young urban population.
Impact of economic reforms on urban sector
India introduced economic reforms in mid 1990s. There are two views on impact of economic
reforms on urban sector in India. One view is that rapid economic growth has opened up job
opportunities in and around several cities. This also led to rise in rural urban migration. The
Eleventh Five Year Plan (2007-12) said that the cities will be focus and engine of economic
growth. There is another view that this process of urbanization has increased inequity and little
reduction in poverty (Kundu 2011). The above analysis brings out that the economic reforms
have leadled to a positive urbaniszation process, but that the inequity has increased during this
period. Thus the urban development programs should focus on urban infrastructure development
and governance reforms. Moreover, there should be complementary programs of urban poverty
alleviation, skill development and employment generation.
Government response on urban infrastructure and reforms
In the context of growing urban importance, Government has implemented various urban
programs. This section describes JNNURM, 13th
CFC and PEARL programs.
JNNURM an Urban Initiative
The Jawaharlal Nehru National Urban Renewal Mission (JNNURM) was launched in December
2005 to bring about urban renewal with a focus on inclusive development of urban centers. The
mission is the single largest initiative of the Government of India for planned urban development
that integrates the two pressing needs of urban India: massive investments required for
infrastructure development reforms that are required to sustain investments. The following
section briefly overviews the initiative.
The JNNURM was launched on a mission mode for a period of seven years to bring about
planned urban development in urban India. With its two sub-missions, Urban Infrastructure and
Governance (UIG) and Basic Services for urban poor (BSUP), the mission formulated reforms
and projects, aiming at rendering ULBs empowered and financially sustainable in accordance
with the spirit of the 74th
CAA for successfully managing the urban agenda (Planning
Commission, 2012). A review of JNNURM’s performance for the past five years shows that
states and ULBs differ significantly in availing their respective grants from the GOI for project
Since the launch of JNNURM, 554 projects, under the sub-mission Urban Infrastructure and
Governance (valued at Rs. 622530 million) have been approved up to July, 2012, out of which
139 (25% of 554) have been reported physically completed. With 415 projects reported to be in
various stages of implementation, the fund utilized against sanctioned is 56.6% (MoUD, July
March 2013, the Additional Central Assistance (ACA) released was Rs. 171879.0
million as against Rs. 288824.4 million (59.5%) committed (Mission Directorate, 31/03/2012).
(JNNURM 2012). Lack of understanding and implementation capabilities with regard to the
twenty-three reforms have been adjudged the major reasons for the inability of the states and
cities to avail the grants. In fact serious handholding is required for some of the backward states.
An analysis of sector-wise distribution of funds sanctioned shows that water supply and
sewerage attracted 56.9% (32.9 & 24% respectively) of the funds released in mission cities under
Urban Infrastructure and Governance (UIG) component, with also Urban Transport accounting
for 22.3% of total funds released. In fact, urban transport received a major thrust under
JNNURM. The central grants would be tied to certain reforms in urban transport to be
implemented both by the state and the ULBs concerned.
In order to facilitate smooth flow of funds from the center to the states and ULBs, the MOUD
has identified certain complex reforms under JNNURM such as rent control reform,; full cost
recovery of O&M for solid waste through user charges,; introduction of property tile certification
system in ULBs,; etc.
Status of Governance Reforms
The States and urban local governments (ULBs) accessing the JNNURM must complete a total
of 22 mandatory and optional reforms, during the seven-year period (2005-12). These reforms
are: (a) Empowering urban local bodies; (b) Enacting Public Disclosure and Community
Participation Laws; (c) Integration of City Planning and Delivery Function with ULBs; (d)
Municipal Accounting Reform; (e) Property Tax Reform; Increase in Collection of User
Charges; (f) Introduction of Administrative and Structural Reforms; and (g) Encouraging Public
JNNURM has certainly has focused the policy makers’ attention, on the policy makers in all
three tiers of the government, on the challenges faced by the cities and towns of India. It has
succeeded in getting the state and city governments to commit to reforms in governance, but the
commitments have not always been kept. States such as Maharashtra, Gujarat, Tamil Nadu,
Karnataka, Andhra Pradesh and Madhya Pradesh have made good progress on governance
On an average, the progress on the implementation of the reform on 74th
CAA has been rather
slow. Many states have expressed lack of clarity on the need for formation of to form
Metropolitan Planning Committees. Many ULBs are not in a position to devolve all functions –
e.g. urban planning including town planning. In addition, the devolution of funds and
functionaries has not happened as expected.
In order to implement this reform more effectively, long-term support would be required along
with clarity in the roles of development authorities, parastatals, and ULBs. Most ULBs do not
have the capacity to take on city planning functions, or are . Many are also not technically
equipped to do sotake on the functions. Wherever there are parastatal agencies like development
authorities, there is lack of clarity on roles of parastatal agencies and ULBs, thus giving rise to
issues of coordination and accountability.
As far as Community Participation Law is concerned, Area Sabhas (community level committee)
have not been created in most states and some have expressed the need for handholding for
finalizing the draft bill. In Public Disclosure Law (PDL), the place,; form,; content; and interval
of disclosure need to be made uniform across ULBs and there is need for discussion with states
to expedite the process of implementation. Most states have expressed the lack of adequate base-
line information to implement the reform on property title certification. In-depth understanding
on operational issues is also required and hence there is need for discussion with states for
The main issue in this reform relate to lack of appropriate knowledge in the method of selection
and appointment of software consultant accompanied by procedural delays. Peer learning within
the state has also reaped benefits.
Evaluation of phase I
With all the above, JNNURM I reform period ended in March 2012. But, it was unable to utilize
more than 50% of the grants. Therefore, it was decided to complete the approved projects and
focus on capacity building in first two years of the12th Five Year Plan. In January 31, 2013, the
MoUD extended sanctioning of new projects and capacity building activities under UIG sub
mission, till the 31st
of March, 2014. As per a Committee on JNNURM, major lessons learned
from JNNURM Phase 1 are: poor planning process, failure to adopt service benchmarks, lack of
capacity, one size fit all does not work and incomplete reforms (Maira Committee, Planning
Commission, 2012). For JNNURM Phase 2 it recommended: completing JNNURM 1 reforms,
preparation of City Development and Financial Plan (on lines of CDP), shifting of focus from
projects to program, 10 - year mission period, leverage funds through PPP, separate capacity
building mission, incentives for taking more complex reforms, etc.
CFC divided the local body’s grants into two components – general basic grant and
general performance grant. The division is significant in terms of urban governance. The general
basic grant can be accessed by all states as per the criteria laid down by the Commission. But the
performance grant can be accessed only by those states which comply with the conditions it
stipulated. Drawing lessons from the poor implementation of the recommendations of the
previous finance commissions the Commission made it mandatory for compliance to nine
conditions - which are in the nature of reforms - to access general performance grant. If the states
do not comply with the conditions they will forfeit the grant for that year. The nine conditions
stipulated by 13th
FC can be considered as reforms to improve the financial status of the ULBs
and to improve their governance. The conditions relate to improvements in audit and accounts
system;, accountability;, improving municipal finances;, address maladministration;, quick
transfer of 13th
FC grants to ULBs without delays,; strengthening the organization and working
of SFCs,; improvements in service delivery; and putting in place fire-hazard response system.)
Linking Reforms under JNNURM and 13th CFC
The implementation of the reform agenda under JNNURM and the mandatory
reforms/conditions stipulated by the 13th
CFC to access the performance grant would contribute
to improve urban governance. Table 10 gives a comparative picture as to how the reforms
initiated by the 13th
CFC and JNNURM contribute towards achieving good urban governance in
Table 20: Reforms under 13th
Central Finance Commission and JNNURM
Sustainability Governance reforms
Accounts and Audit Reforms
Benchmarking Service Provision
Assigning or associating ULBs in
Levy of user charges
Waste water reuse
Subsidiarity Assigning or associating ULBs
in service delivery
Integration of Cantonment Plans
Support to Fire Services
Capacity Building of Local Fund
Promotion of Public Private
Associating or assigning ULB in
Promotion of Public Private
Benchmarking Service Provision
Local Body Ombudsmen
Accounts and Audit reforms
Rent Control Law
Repeal of ULCRA
Earmarking developed land to
Administrative and Structural
Budget supplement on ULBs to
Publication of Benchmarks in
Local Body Ombudsmen
Public Disclosure Law
Assigning or associating ULBs in
Civic engagement Finalization of benchmarks
Community Participation Law
Security Service improvements through
Fire hazard response and
Basic Services to Urban Poor
Property Title Certification
Source: Prasad, D. Ravindra and Chary, V. Srinivas, 2010
PEARL Program of Networking Cities
India has put together a program called PEARL (Peer Experience and Reflective Learning) to
create networks between mission cities for cross-learning and knowledge exchange on urban
reforms and projects (Vaidya and Sur, 2012).
The launch of the JNNURM, seven years ago, has triggered the process of urban renewal by
improving urban governance,; augmenting civic infrastructure; and enhancing effective
delivery of basic services such as water supply, sewerage, drainage and solid waste
management in many of the mission cities.
To achieve these objectives, it was imperative to support and share Kknowledge support and
knowledge sharing amongst selected cities for project implementation,; to undertake urban
reforms and strengthen city governance as part of capacity building of ULBs to achieve
objectives of the Mission was therefore imperative. It was felt that selected cities can network
amongst themselves for cross learning and knowledge sharing. Towards this end, MOUD has
provided its support to the cities through PEARL Program.
Knowledge sharing amongst selected cities in various sectors of urban reforms and city
governance has emerged as a potential area for capacity building and networking, leading to
more effective city management. The main objective of the Program is to create an effective
network of JNNURM cities for cross learning and sharing knowledge on urban reforms, city
governance and urban infrastructure projects so that objectives of the mission can be
successfully achieved to make cities more livable, economically vibrant and environmentally
sustainable. The activities include the following: (a) Assessment of knowledge needs; (b)
Development of knowledge products (such as Good Practices); (c) Hosting a website; (d)
publishing newsletters; and (d) organize workshops to exchange experiences and lessons learnt.
As part of the activities, documents on urban initiatives from mission cities have been
published. These reports stand as an important source for horizontal learning among mission
cities. Other knowledge products such as a Handbook on Primers under JNNURM were also
published. Postcards and Flyers in English, Hindi and five other regional languages have been
developed under the program for dissemination of news, information and knowledge on the
network, Newsletters are published and circulated both in English and Hindi (Indian language).
National and state programs on urban employment
This section describes National Skill Development Corporation, proposed National Urban
Livelihood Mission, State Level Initiative in Andhra Pradesh and NGO Initiative in Ahmedabad
National Initiatives Skill and Employment Generation
With the opening of economy being opened-up in mid 90s, a large number of persons are and
well-educated labour force was required to sustain growth. The Government of India has set up
a National Skill Development Corporation (NSDC) with an innovative Public Private Partnership
(PPP) model to address the skills gaps in India.
“Although the NSDC’s interventions augur well for the cause of skills promotions, there is still
no getting away from the fact that a lot more work needs to be done for skills culture to take root
in India” (Chenoy, 2012). In the context of large-scale unemployment and under employment in
rural India, the Government, nine years ago, a Rural Employment Guarantee Scheme which
provides one hundred days of guaranteed wage employment in a financial year to every rural
households whose adult members volunteer to do unskilled manual work. The radical program
is now fully operational and provides employment to 25 per cent of India’s rural households.
Such large-scale skill development and employment generation programs are not available in
National Urban Livelihood Mission
The Ministry of Housing and Urban Poverty Alleviation (HUPA) is currently implementing an
employment – oriented scheme, namely, Swarana Jayanti Rozgar Yojana (SJSRY). It was
started in 1997 and aims to provide gainful employment to unemployed and underemployed
urban poor. It has five components: (a) the Urban Self-Employment Programme which targets
individuals to set up their micro enterprises; (b) Urban Women Self – Help Groups; (c) Skill
Training for Employment Promotion; (d) Urban Wage Employment; and (e) Urban Community
Development Network. It is implemented on cost sharing basis with State Governments in the
ratio of 75: 25. It covers a small target. Lessons learned from implementation of SJSRY are:
Uneven spread of Self – Help Groups across the country
Weak convergence with other social sector schemes (like Health Insurance Scheme,
Integrated Child Development Scheme, Education etc.)
Problems of targeting benefits
Lack of an integrated approach to training
Lack of Capacity Building
Top down approach
Lack of dedicated implement structure (HUPA, 2013)
In this context, it is proposed to set up a mission – mode approach to urban livelihood in form of
National Urban Livelihood Mission (NULM). The core belief of the mission is that the poor are
entrepreneurial and have desire to come out of poverty. The challenge is to unleash these
capacities to generate sustainable employment. Objectives of the mission are to: enhance
livelihood options for the poor; building skills,; training,; ensuring linkages to other programs;
and build capacity. It recognizes need for dedicated support structures at local, state and national
levels. It will have the following components: Social Mobilization and Institutional
Development; Capacity Building and Training; Employment through Skill Training and
Placement; and Self – Employment Program.
Specific components of the Mission include: Formation of community structures;, universal
financial inclusion,; revolving fund,; Community Investment Fund,; capacity building,; technical
support to at local and state levels,; employment through skills and training and placement,;
individual and group enterprises,; credit card,; marketing support,; etc.
Funding under NULM will be shared between the center and states in the ratio of 75: 25. In case
of special states, it would be 90: 10. There will be a built – in component of monitoring and
evaluation. It should be noted that unlike the Rural Employment Guarantee Scheme there is no
guarantee of employment in the urban scheme.
State Initiative in Andhra Pradesh
Alleviating Ppoverty has long remained a State subject responsibility in India. Only, the 74th
Constitution Amendment Act brought the subject of urban poverty alleviation it under the
mandate purview of ULBs, as per the XII Schedule. (Steering Committee on Urbanization, 3
October, 2011). Andhra Pradesh (AP) Mission for the Elimination of Poverty in Municipal
Areas (MEPMA) has proactively evolved innovative solutions to creating choices for the urban
poor through various approaches for urban poverty alleviation. (Steering Committee on
Urbanization, 3 October, 2011) ; especially with Andhra Pradesh seeking for all urban poor
families to be having improved quality of life by accessing services from all organiszations
through their own strong self reliant and self managed institutions (Department of municipal
administrtaion and urban developent, 1999), The objective, is to promote, strengthen and nurture
self-sustainable institutions of the poor and through them, address all poverty issues like access
to credit, financial freedom, health, disability and vulnerability (Department of municipal
administrtaion and urban developent, 1999). The method involves, Institutionalization of
community structures along with imparting a participatory nature to these citizen groups and
integrating the skills and livelihoods with the new structural setup, in a mission mode, with
MEPMA being the Nodal agency for convergence of all services targeted towards the urban poor
(Youth welfare, Minority, BC, SC, ST, Labour, Health, Women & Child welfare, Civil Supplies
etc.), RAY, and the Street Vendors Policy among others.
The progress under this Mission has been remarkable and nearly, 2.5 million lakh members are
involved in 250 thousand Self Help Groups (SGH) spread across all the municipalities in the
State. 90% per cent of the urban poor living in 7520 Slums in the State have been organized into
SHGs. Bank linkages of Rs. 14810.8 Million have been established. Around 5100 micro-
enterprises have been grounded (Steering Committee on Urbanization, 3 October, 2011).
The program has thus, converging with various programs (- Rajiv Awas Yojna- in-situ slum up-
gradation), reached the lowest level of governmentance, with 42 class I towns and has
successfully by building Community Business organizations in the society, brought in a new
structure that works closely with municipal governments and financing institutions formulated at
lowest levels. For example, in the urban slum areas, under the MEPMA 10-12 urban women
form into Self Help Groups (SHGs), when 20 SHGs group together they constitute one Slum
Level Federation (SLF). A Town Level Federation (TLF) comprises of 25-35 SLFs. These are
encouraged towards internal savings and internal lending, also with inter-linkage with micro-
financing institutions and banks, access to credit is created. Loans with Subsidies for self
employment units are also a choice that increases capabilities.
The explored fundamentals for poverty are a part of the programme adopted by GoAP’s stride
towards poverty alleviation takes into consideration that poverty is a multidimensial problem,
and therefore focusses on the following aspects:. The thrust has been towards building
capabilities in poor that help reducing unemployment and thereby reduce poverty and includes,
Empowering the poor by building their capacities (with special community enhancement
Creating highly trained social capital at grass root level in health, education, livelihoods,
Access to Credit for the poor by facilitating interface between CBOs and bankers (Town
Level Bankers committee with SHGs), especially women, with forming the urban women
into Self Help Groups (SHGs) and encouraging internal savings and internal lending.
Taking up placement linked livelihood programmes on continuous basis; and
Services under 7-point Charter (Security of land tenure, improved housing, sanitation,
water supply, health, education & social security system), etc.
The urban women Self help programme, Urban Self Employment Programme
NGO Initiative in Ahmedabad, Gujarat
Ahmedabad is capital city of Gujarat state. It is a very progressive city that implemented a large
– scale urban development programs like Bus Rapid Transport System (BRTS), Sabarmati River
Front Development, Town Planning Schemes, Slum Networking, Lake Development, e-
Governance etc. It had a population of 5.57 million in 2011 and about 44 per cent of them lived
Saath Charitable Trust, an NGO, started supporting youth up-gradation skills since 1990 in the
city (Joshi and Joshi, 2012). With economic reforms there was a growing demand for skilled in
the service sector like trade and commerce. Saath introduced two livelihood programs Urmila
and Umeed. The Urmila program was initiated in 2001 to train women as “Home Makers”.
Many slum women are employed by number of households for tasks as washing clothes,
washing Utensils, sweeping and mopping floor. The trained home makers specialize in home
care and accountable services. Training included child care, cooking, management of kitchen
In 2005, in partnership with the Ahmedabad Municipal Corporation, Saath initiated a livelihood
program for youth. In 2007, Government of Gujarat decided to adopt and scale-up the approach.
Under Umeed (it means hope/aspiration). The specific aim of the program is to enhance earing
capacity of youth from poor households and identify suitable job opportunities in graving service
and manufacturing Sectors. Job placement is a major incentive for the youths.
For admission to the three months duration program the candidates should be between 18-35
years of age, education between 8 to 14 years, from poor family and pay a fee of Rs.500 (US $
11). Overall training cost is Rs.4500 (US $ 99) per participant. The student pay Rs.500 and
remaining is paid by the American Indian Foundation and State Government. The requirement
of payment of fee by the participant is very essential.
Saath aims to generate a demand for the training based on experiences. Unlike traditional
programs that only provide training, it adopts a multi – pronged and multi – stakeholder
approach. A market scan is carried out to identify skill gaps. Training plays an important role.
It collaborates with recruitment agencies to carry out on – the – job training and provide
guidance. Successful employed youth are brand ambassadors for the program. In addition, local
Communities become stakeholders and program advocates.
Training is conducted in Umeed Training Centers which are located within a two kilometer
distance from low income communities. The program includes class room training, guest
lectures, exposure visits, on – the – job training. It also includes communication, grooming,
personality development, English language, computer, customer relation skills, etc.
Saath has established a Livelihood Cell which comprised a team of about 100 persons to
implement the program. It carries out door – to – door marketing of the program, mobile
advertising through auto – rickshaws, setting up booths in common places, and showing short
film on the program. Program documentation is carried out through regular reports, case studies,
third party inspections, etc.
Till 31 July 2011, 53 Umeed Centers were set up in Gujarat and Rajasthan. A total number of 40
thousand trainees were enrolled and 65 per cent of them were placed in jobs (Table 21).
Umeed faces several challenges to scaling up. These include addressing issues indentified by
Third party inspections, getting, grants on regular basis, coordination among various agencies
and unable keep trained staff.
Table 21: Number of Trainees Enrolled, completed and place-Umeed Program
No. % of those
No. % of trainees who
February 2007-March 2008 4,643 2,339 50.38 1,869 40.25 79.91
April 2008 to March 2009 11,096 9,464 85.29 6,813 61.40 71.99
April 2009 to March 2010 15,258 13,933 91.32 9,327 61.13 66.94
April 2010 to March 2011* 7,313 8,618 117.84 7,659 104.73 88.87
April 2011 to October 2011 3,237 2,482 76.68 1,578 48.75 63.58
Total 40,426 36,217 88.66 26,804 65.58 73.97
Source: Joshi, Sharadbala and Joshi, Rejendra, “Informal Sector and NGO Initiative in India” Saath, 2012.
* The higher placement figures (more than 100%) are a result of efforts made during the period for clearing backlog
from previous years.
WAY FORWARD Recommendations
It is needless to say that urbanizsation in India has enormous promise for making the economy
more efficient, generating economic growth and reducing poverty. But a good proportion of that
promise is not being fulfilled. This is mainly because affordable serviced land is not available
and good urban governance is lacking. India needs to improve delivery of urban services and
JNNURM is the largest urban infrastructure investment program in India. Between the years
2005-13, additional central assistance was as high as Rs. 171879 (US$ 3125 million). It has
Case Study of One Employed Young Girl
Sacha Raziya is, 26 years old, from the 2nd
batch of IT Enabled Services (ITES) Umeed
program. She is currently working as a tele-caller in Azure, a Call centre and earning Rs.
6000 per month. Raziya is a divorcee, living in Juhapura area, Ahmedabad with her family.
There are a total of 7 members in her family (father, mother, elder sister, elder brother and
his wife, younger brother and her son). Raziya belongs to a middle class family whose
annual income is Rs. 30,000. Her father is retired and her mother is a housewife. She is a
commerce graduate. She was working as a clerk in A-One school, but due to some personal
reasons she left her job. The Umeed road show in her area caught her attention and she
decided to join the course. (Source: Joshi and Joshi 2012)
She is happy with her job at Azure and is also preparing for her Chartered Accountant’s
entrance exam. She hopes for a better life for her son and feels confident that she is
working towards it on her own terms.
improved infrastructure covering about 40 per cent of the urban population. As many as 24 cities
have planned 24X/7 water supply, 11 cities are focusing on improved public transport system,
and most state governments have committed to urban reforms. Compared to JNNURM, the Saath
Charitable Trust initiative is that it is useful for beneficiaries and may well be cost effective, but
that it is also small relative to the scale of the underlying need. JNNURM and NULM programs
need to be integrated with local community-led programs like the Saath Charitable Trust to have
a greater impact on the urban poverty.
Great progress has been made in developing the framework for reform linked investment in
urban infrastructure through JNNURM and recommendations of 13th
CFC. However, many
ULBs are yet to develop themselves as autonomous city management agencies to dovetail
urbaniszation with economic development. It can be said that urban India is at a cross roads. In
this context, an urban strategy is suggested to address issues that are critical for sustainable urban
improvement in city form and provide critical inputs towards the design of for developing the an
urban development approach for the country. The key theme for strategy may be: “Enabling
Urban India to meet the challenge of Economic Development”.
To improve urban governance and delivery of services, there should be constitutional
amendments as well administrative actions. These are:
schedule of the constitution should be amended and classify the functions into core,
assigned by government and others functions. Article 243-W should amend so that ULBs should
be accountable for provisions of core services in 12th schedule. The term “may” the sub-section
should be replaced by “shall” for core functions. The services may be provided by the ULBs
directly or indirectly through parastatals or outside agencies. Industrial areas should not be
exempted from formation of ULBs.
Governance: For strengthening ULBs, the Government may consider the adoption of a common
categorization of urban bodies across the country to improve clarity in their definition so as to
assist a systematic planning process and devolution of funds. A minimum level of staffing should
be provided for ULBs in metropolitan areas. The Mayor should be the Chief Executive of the
Finances: Additional grants should be provided to improve staff capacity of ULBs. Grants from
CFC to ULBs should be linked to level of decentralization and performance. Municipal bodies
should be encouraged to borrow without Government Guarantees. However, for small
municipalities, pooled financing mechanisms will have to be put in place by the State
Planning: MPC/DPCs need to coordinate with various agencies with regard to implementation of
various programs. In case of large ULBs, there is need to promote area sabhas at election booth
level. The ULBs should be able to prioritize the development programs. Any mega project
envisaged needs to be developed taking into account the views of all the Stakeholders. As far as
possible, the land may be acquired through negotiations and the affected persons need to be
provided with alternative housing and livelihood.
Delivery of Services: Management of water supply and sewerage system should be the primary
function of ULBs. They should be given responsibility for water supply and distribution in their
territorial jurisdictions whether based on their own source or on collaborative arrangements with
parastatal and other service providers.
Encouraging PPP: Successful PPP programs should be handled at both State and City levels.
Role of the state should be to create an enabling environment with an aim to expand, broaden
and deepen private sector investments in infrastructure, whereas the role of city should be to
develop and implement PPP projects in a process oriented approach. Municipal laws should be
amended to provide enabling provisions for PPP in delivery of services and setting up state or
city level regulatory frameworks.
Soft Infrastructure: It must be recognized that along with additional funds, there is need to
improve soft infrastructure in urban sector like technical assistance, capacity building, centers of
excellence, e-Governance, peer learning, etc.
Integrated Approach: Unlike rural areas where focus is on manual labor, urban areas should
focus on integrated approach that includes training, skill development, financing, placement and
Community Structures: Strong community structures with links and support from local, state and
national governments is necessary for sustainable employment and skill development programs.
Linkages with Urban Development: Employment generation and economic development should
be an integral part for urban development.
PPP: National Urban Livelihood Mission should focus on regulation, innovative financing and
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