Why Does India Continue to be Called a ‘Low Urbanised Country’?

At present, according to census 2011, roughly 31 percent of Indians reside in urban areas. 

(Photo: iStockphoto)

Did you know that 9 million people were added to urban areas in India in the noughties (2000 to 2009)? But what do we mean when we say ‘urban India’? Is the strip of land between Delhi and Alwar or Mumbai and Pune ‘urban’?

Currently, India uses three broad ways to classify an area as urban.

Statutory towns are declared as per the statutes of the respective state government and necessarily have elected urban local bodies (ULBs). As per the Census 2011, there were 4041 statutory towns. Census towns are areas with a minimum population of 5000, a population density of at least 400 people per square kilometre and more than 75 percent of the male working population engaged in non-agricultural pursuit. Census towns doubled from 1362 in 2001 to 3894 in 2011. Interestingly, these ‘towns’ are governed by village panchayats.

Why is the Spread of Urban Governance Only 26%?

Outgrowths are viable villages adjoining statutory towns; they possess urban infrastructural facilities and are governed by village panchayats. Census 2011 enumerated 981 such outgrowths in the country.

But could India be more urban than what has been contained within these definitions?

As per the above, the level of urbanisation in India is 31 percent, but the spread of urban governance is only 26 percent.

When a settlement is declared ‘urban’, it is subjected to the application of rules and regulations, building by-laws, development controls and taxation.

However, in the absence of a proper urban classification, areas with urban characteristics are often left out of planned growth and witness an increase in inequality, informalisation of employment and deterioration in the quality of work and life.

Issues of air pollution, depreciating and absent infrastructure, and natural resource mismanagement result when proper governance and finance are not complemented with the changing characteristics of geography and demography.

Additionally, resource allocation decisions, including government support, are contingent upon the level of urbanization of an administrative area. While the Jawaharlal Nehru Urban Renewal Mission (2007) considered urban population size for fund allocation, the Smart Cities Mission (2015) gives equal weightage (50:50) to urban population and the number of statutory towns in a state or union territory.

Official Modes of Recognising Urban Areas in India Underestimate Actual Extent of Urbanisation

Fund disbursement from the Centre to State and local bodies, as outlined by the Finance Commission, is determined on the basis of whether an area is urban (and the level of urbanisation in such areas) or rural. The interim Fifteen Finance Commission Report (February 2020) fixed grants for rural and urban local bodies for 2020 –21 in the ratio 67.5:32.5 for the corpus Rs 90,000 crore.

As far as urban governance is concerned, the Constitution provides a framework without any particular criteria to declare urban local bodies. As a result, these criteria are non-uniform in the country. For instance, the minimum population to qualify as a small urban area varies from 5000 in Himachal Pradesh and Sikkim to 1.5 lakh in Mizoram.

The official modes for recognising urban areas in India underestimate the true extent of urbanisation.

A certain measure of uniformity is essential in defining the need and basis for declaring ULBs. This would restructure land-uses and broaden the local revenue resource base.

Also, studies reflect that many states in India, including highly urbanised ones, do not have fixed criteria for establishing or de-notifying an urban area. This could be because of organisational inertia or a deliberate intent to maintain a vague definition for municipalisation in order to allow access to funding meant for rural areas.

Why ‘Censoring’ of Urbanisation Must Stop

From a policy perspective, censoring urbanisation for funding incentives means a rural local body governs an urban settlement. The hurdles posed by such definitions have resulted in peri-urban areas being left out of the net of urban development subsidy benefits, where maximum growth of real estate and related infrastructure take place given the scarce availability of land in the city core. More so, it affects the urban poor that can hardly find affordable homes in the city limits and have to live under extreme vulnerability.

Government funding should be linked to the right reporting of urban trends, and under-reporting should result in financially shadowing the area from further resource allocation until compliance is restored.

Conversely, a funding grant can also be designed for newly identified urban areas so that infrastructural deficits can be corrected in time and state governments see an incentive in right reporting of geographical realities.

How urban would India be if it used the same criteria for declaring census towns as other countries?

If, like 37 other countries, India used only the population or density criterion, nearly 485 million people would become urban (if one used a threshold of 2000 per settlement), or 497 million people become urban (if one used 400 people per sq. km. as the threshold).

The addition of these people would make India more than 71 percent urban! Even just using our high threshold of 5000 people per settlement would add 196.2 million persons and make India 47.5 percent urban.

A directive issued in May 2016 by the erstwhile Ministry of Urban Development (now Ministry of Housing and Urban Affairs) directed state governments to convert census towns to urban local bodies. This must be exercised with utmost urgency.

India Must Acclimatise its Census Operations With Changing Demography

The growth of urbanisation in China is partly attributable to the changes it made to its urban definition in 1990, 2000 and 2010. This becomes especially important when India is depicted as a ‘low urbanised country’.

India might like to follow the example of some developed nations that use indicators like mobility, nightlights and settlement pattern to determine the level of urbanisation. Satellite images of night-time lights indicate the presence of economic activity while commuting patterns generate an understanding of integrated labour markets.

It is important for India to acclimatise its census operations with the changing demography.

Being stringent and over-prescriptive results in loss of economic efficiency and labour productivity. While there is no globally accepted definition of ‘urban’, being reluctant in recognising the urban phenomena may result in a century of catching up with the world as was the case with industrialisation.

The potential of an urban system to anchor economic growth must be driven by policies that are concurrent with ground realities.

(Richa Rashmi is an urban planner and Young Professional at NITI Aayog. This is an opinion piece and the views expressed are personal. The Quint neither endorses nor is responsible for them.)