New Delhi: From creative redevelopment of existing cities to streamlining urban property records, Union Finance Minister Nirmala Sitharaman Tuesday announced a handful of measures for the development of cities as “growth hubs” in the Union Budget 2024-25.
The announcements are in line with the Narendra Modi-led government’s continued focus on planned urban development of cities. In the past two budgets (FY 2022-23 and FY 2023-24), the Centre had announced crucial urban development initiatives, including setting up an Urban Infrastructure Development Fund (UIDF) worth Rs 10,000 crore for tier 2 and tier 3 cities.
While the Centre has announced new initiatives to address urbanisation challenges, some of the initiatives announced in past budgets and recommended by the 15th Finance Commission are either in the nascent stages or yet to be finalised. The high-level committee on urban planning is yet to submit its final report, while centres of excellence, which were proposed in 2022, were announced last year.
In the first budget of the Modi-led government’s third term in power, the finance minister said the Centre will work along with states for planned development of not only cities but peri-urban areas.
“Working with states, our government will facilitate development of cities as ‘growth hubs’. This will be achieved through economic and transit planning, and orderly development of peri-urban areas utilising town planning schemes,” Sithraraman said.
The allocation for the Ministry of Housing and Urban Affairs saw an increase from Rs 76,431 crore for 2023-2024 to Rs 82,576.57 crore for 2024-25. The revised estimate for 2023-2024 was Rs 69,270.72 crore.
The finance minister said urban development was one of the nine priority areas in this year’s budget and announced key initiatives which the government plans to take up this financial year for comprehensive development. Under the ‘next generation reforms’, which was another priority area, the finance minister also announced the incentivisation of land-related urban and rural reforms, which will be implemented in the next three years.
Apart from the urban planning initiative, Sitharaman said the Centre will formulate a framework for enabling policies, market-based mechanisms and regulations for “creative brownfield redevelopment of existing cities with a transformative impact”.
The impact of fast-paced urbanisation is gradually being felt in cities with stress on existing infrastructure due to increasing population. This has also led to an increase in demand for housing. Urban development experts say redeveloping existing areas in cities will help in tackling the crisis cities are facing today.
While the Centre has been pushing for Transit Oriented Development (TOD), the Modi-led government, for the first time, announced an initiative to implement it in select few cities.
“Transit Oriented Development plans for 14 large cities with a population above 30 lakh will be formulated, along with an implementation and financing strategy,” the finance minister said.
For the development of sustainable cities, the finance minister announced that the Centre will promote water supply, sewage treatment and solid waste management projects and services for 100 large cities in partnership with states and Multilateral Development Banks (MDBs).
Urban development expert R Srinivas, former town and country planner with the Town and Country Planning Organisation under the Ministry of Housing and Urban Affairs, told ThePrint, “There is a need for better planning at city level. Several initiatives under the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) scheme have pushed for urban planning reform, but the push for taking up projects in selected cities for transit oriented development and other initiatives announced in the budget will further give impetus to housing for all and strengthening of urban infrastructure in cities.”
Incentivisation of land reforms in urban and rural areas
While the government has been implementing land-related reforms in rural areas since 2014, the Centre plans to implement a similar initiative in urban areas.
Land-related reforms and actions, both in rural and urban areas, will cover land administration, planning and management, and urban planning, usage and building bylaws. “These will be incentivised for completion within the next three years through appropriate fiscal support,” Sitharaman said in her budget speech.
Under the urban land reforms, the land records in urban areas will be digitised with Geographic Information System (GIS) mapping. “An IT-based system for property record administration, updating, and tax administration will be established. These will also facilitate improving the financial position of urban local bodies,” Sitharaman said.
In a 7 July report, ThePrint wrote about the Centre’s plan to streamline urban land and property records. The land reform in urban areas will be implemented by the rural development ministry’s Department of Land Resources (DoLR), which is responsible for land-related matters. The department is planning a pilot project in around nine states to understand the challenges before finalising the scheme, ThePrint had reported.
The department is already implementing the land reform scheme in rural areas where Unique Land Parcel Identification Number (ULPIN) or Bhu-Aadhaar are issued to owners for the land parcel; cadastral maps are digitised; and survey is conducted, among other measures.
The Centre has decided to link the land registry in rural areas with farmers’ registry. “These actions will also facilitate credit flow and other agricultural services,” the finance minister said.
Housing for urban areas
As announced in the interim budget in February, the finance minister said during the full budget speech that the housing needs of one crore poor and middle-class families in urban areas will be addressed with an investment of Rs 10 lakh crore. “This will include the central assistance of Rs 2.2 lakh crore in the next five years. A provision of interest subsidy to facilitate loans at affordable rates is also envisaged,” she said.
Under Pradhan Mantri Awas Yojna (PMAY)-Urban, 1.19 crore houses were sanctioned, of which 85.04 lakh were completed as on July 15, 2024.
The Centre has increased the allocation for PMAY-Urban from Rs 25,103 crore in the budget estimates of 2023-2024 to Rs 30,170.61 crore in 2024-2025. The revised estimate for the scheme was Rs 22,103 crore in 2023-24.
The minister said that policies and regulation will be drafted for efficient and transparent rental housing markets with enhanced availability.
Weekly haats or street food hubs
After the successful implementation of the PM Street Vendors AtmaNirbhar Nidhi (PM-SVANidhi) scheme, which was announced in 2020 to help street vendors restart their businesses post the Covid-19 pandemic, the Centre now plans to set up weekly haats or street food hubs in selected cities.
The finance minister said, “Our government envisions a scheme to support each year, over the next five years, the development of 100 weekly ‘haats’ or street food hubs in select cities.”
(Edited by Radifah Kabir)