FINAN CING

Transforming the existing cities into smart cities

requires a lot of funds. Despite the generous

budgetary allocations by the central and state

governments, financing the smart cities remains a

big challenge. BW SMARTCITIES report

SMART

W

HEN THE SMART CITIES MISSION

was launched, the biggest challenge

for the policy makers was how the

government is going to fund these

100 cities, given the huge investments

required to upgrade the basic infra-

structure of these cities. The critics

had raised their doubts over the fi-

nancial viability of the project, which

they thought to be ambitious but pre-

mature, given the poor infrastructure

of Indian cities and the past track re-

cord of the other infrastructure pro-

jects like JNNURM.

In the initial phase the government

selected 33 cities and is planning to

shortlist rest of the 100 cites by the

year 2019 which can be developed as

the smart cities. However within one

year of the launch of the project, the

initial euphoria over the Smart Cities

Mission is setting down and the cen-

tral government, state and the cities

are increasingly feeling the pressure

to fund the most ambitious project of

the Narendra Modi government.

Many cities are expressing their dif-

ficulty in raising funds and unable to

raise funds, they are looking at the

Centre for increasing the budgetary

allocations of the projects. In this sce-

nario financial constraints pose big

challenges for the central and state

governments and urban local bodies

(ULBs) to successfully implement the

project.

The Smart City Model of Financing

Venkaiah Naidu, Minister of Urban

Development said, “The vision be-

hind the smart cities was that the cit-

ies must be self-financing with hand

holding from the state and the centre.

It require the bottom up approach for

the mission to be successful”.

According to the Smart Cities Mis-