1、 Boston Consulting Group 2023 1 Cities of the Future:Reimagining and Rejuvenating Indias Top 50 Urban Ecosystems FEBRUARY 2023By Suresh Subudhi,Saurabh Bakliwal,and Shubhika BilgramiIndias economy has achieved substantial growth over the past 25 years.Our national GDP has grown approximately 6-fold,

2、from US$0.5 trillion in 1996 to US$2.8 trillion in 2021.Much of this progress was driven by the economys transition from one being based on agriculture to one based on services.This shift also led to the emergence of the economic powerhouses of our country:Indian Megacities.Boston Consulting Group 2

3、023 2 1.https:/ October 2019 and June 2020 for Delhi and UP3.https:/dipp.gov.in/sites/default/files/FDI_Factsheet_June20_23Sept2020.pdf uptatur?4.https:/ 5.https:/ According to some estimates,Indias urban population contributes 63%to GDP,which by 2030 is expected to rise to 75%.However,growth has no

4、t been equitable across cities.The metros and a few tier-1 cities have grown rapidly,while other smaller towns and cities have languished behind or even declined in their relative importance to our economy.This model of growth has created extreme pressure on Megacities,making them increasingly unliv

5、able.With Indian youth from smaller cities finding themselves disfranchised from access to quality economic opportunities and social infrastructure,India has over the years witnessed unprecedented migration from urban-to-urban areas.As per the last Census,81%of new migrants in the top six metros wer

6、e from other cities1.In this context,we have identified three critical areas that need to be addressed going forward1 Economic and social inequity across cities:A lack of structured planning has led to the concentration of wealth in megacities.While Delhis per capita income was Rs 355,000 in 2020,sm

7、aller cities like Bareilly and Patna were below the Rs 100,000-mark.Indias smaller cities have witnessed huge social inequity too such as,for example,an acute lack of access to healthcare and education infrastructure.Even private sector investments have shied away,favoring the mega and metro cities.

8、On one hand while Delhi accounted for 16%of the national FDI equity inflow2 in 2020,Uttar Pradesh received only 1.2%3.2 Deteriorating quality of life conditions:Our megacities have not been able to keep pace with the rate of migration and this has led to uncontrolled development,which in turn has cr

9、eated acute shortages in housing,congestion,and long commuting times.This has led to poor standards of living,forcing especially many low-income workers to reside in slums and other informal settlements.Today,nearly 42%of Mumbais population live in slums4 and more than 750 slum clusters5 are present

10、 in New Delhi.No wonder that New Delhi,and Mumbai rank 118th and 119th out of 140 cities,according to the Economist Intelligence Units Global Livability Index 20196.Boston Consulting Group 2023 33 Climate change and sustainability:Toxic air,decrease in forest cover,depletion of water tables,increase

11、 in GHGs(Greenhouse gases)and poor waste management go hand in hand with rapid urbanization.The impact of extreme weather and global warming has already started affecting large cities in India.The eight tier-1 cities in India produce 12%of Indias CO2 Emissions7.Chennais temperature,for instance,has

12、risen by nearly 1oC7 since the 1960s,which has made it more prone to severe monsoons,flooding,and the risk of submergence in the future8.While the economic revolution of the last 25 years has indeed moved India towards a development paradigm that focuses on urban development,one that helped create m

13、ega urban centers,it is evident now that India must develop solutions that prioritize a more equitable and sustainable growth for its NextGen cities.So where could Indias next-gen cities lie?While building new infrastructure assets or establishing greenfield settlements rank high in any urban develo

14、pment agenda,it is important that we make the most of existing cities.Apart from Megacities,India has nearly 50 cities with a population of 1 million and above9.Having been developed over decades our cities fortunately already have basic systems and institutions such as municipalities,utilities,scho

15、ols,hospitals,and parks,among others in place.Moreover,these cities are not only diverse and unique but also have space for expansion,be it state capitals like Bhopal and Raipur,industrial towns like Kanpur and Vishakhapatnam,historical cities like Madurai and Jodhpur or well-planned towns like Chan

16、digarh or Bhubaneswar.Thus,interventions for our NextGen cities must primarily focus on their rejuvenation,efficient utilization,and repurposing of existing resources.Envisioning the key characteristics of Indias new urban ecosystems and 50 NextGen cities Before we delve deeper into the solutions fo

17、r the rejuvenation of these 50 urban ecosystems,it is important to identify the key features or characteristics that would define these cities.7.https:/www.downtoearth.org.in/dte-infographics/61005_emission_cities_india.html 8.https:/ 9.https:/ Boston Consulting Group 2023 4 There is no doubt that t

18、he focus must be first and foremost on livability,wherein a citizen-centric ecosystem would revolve around the needs of every resident.Consider the worlds most livable cities,which provide relevant economic opportunities;quality Infrastructure:health,education,utilities,and entertainment;well networ

19、ked transit and digital systems;foster community well-being and help develop a sense of identity.In fact,every year several surveys are conducted to assess and compare the livability of global cities.Vienna,which often tops the EIUs Global Livability Index,excels in all these parameters.Sustainabili

20、ty and resilience should be another priority for these urban ecosystems.Canberra,named the worlds most sustainable city,not only has 87%of green transport infrastructure but has implemented several initiatives that have led to its capital territory being powered by 100%renewable energy.Further,these

21、 cities should focus on building self-sustained and accessible microcosms.Idea should be reduce commute distance and time by ensuring that all the needs of a citizen,i.e.,housing,work,education,health,amenities,entertainment,and daily essentials are accessible within few minutes of active mobility.T

22、hrough prudent planning and sound investments,our cities can tap into new age concepts such as Polycentric cities(which has multiple city centers)or 15-minute cities,which minimize travel and ensures all amenities are optimally distributed across the city.Indias 50 NextGen cities:How can we achieve

23、this urban development vision?I.Reimagining Urban Design and Masterplans Any effort to make cities livable must keep current and future needs of citizens and sustainable living at the center of city design and masterplan.There is an urgent need to rethink how we approach urban design and masterplans

24、.We must begin by equipping urban local bodies to prepare and maintain a rolling 10-and 30-year masterplan for each of these 50 NextGen cities.These masterplans should consider not just development initiatives by the Centre and state governments,but also welcome inputs from citizens and civic groups

25、.Boston Consulting Group 2023 5Singapore,for instance,has had a very planned approach to city district development.This has not just helped in the very efficient use of space,important for a land-constrained city-state,but more importantly it has enabled the creation of a more livable and sustainabl

26、e city ecosystem.II.Building Distributed Economic Growth Engines As India aspires to accelerate economic growth and become a US$5-trillion economy,it will need to spur growth across all the three key pillars of the economy,manufacturing,services,and agriculture,and build capabilities and scale acros

27、s multiple sectors.The Government of Indias effort to build Indias capabilities in new areas such as electronics,APIs,furniture,technical textiles among others,through the PLI scheme,for instance,is a step in the right direction.Combining such measures with an urban development national masterplan t

28、hat also lays the focus on specific sectors could help create several distributed economic growth engines.This will also help tap into Indias much larger talent pool and thus accelerate scale up across sectors and create sector-specific deep ecosystems.More importantly,this will also ensure that wea

29、lth and growth spreads equitably across all regions of the country.There could be three distinct models of development depending on the industry and sector in focus.The first model is the City Cluster model of development.It is undeniable that large and expansive metropolitan regions have their own

30、advantages.In many situations where significant capex investment is required to build a core infrastructure(e.g.,Port,DFCs),or where a network effect is critical to build an ecosystem(e.g.,Media&Entertainment Sector,Startup Ecosystems),scale plays an important role in building competitiveness.In suc

31、h situations,a Cluster City model where regions are centered around one large city and many smaller towns nearby could be the desired development approach.A good example is the Pearl Delta Region,a cluster of nine Chinese cities that constitutes merely 0.4%of land area but account for nearly 10%of C

32、hinas GDP.Boston Consulting Group 2023 6 The second model is to focus on a specific USP of a city.This could be driven by availability of a specific natural resource or geographic advantage(e.g.,Jamshedpur),or because of unique manpower and skill availability(e.g.,Jodhpur for furniture).To attract i

33、nvestments,it is pertinent for city leaders to think out of the box.Mimicking Bangalores or Hyderabads success and implementing solutions that worked in the past(such as setting up software hubs,SEZs and research parks)may fail to attract investments in future.Indeed,steps must be taken to invest in

34、 innovation districts and to identify future growth industries that suit local needs today.For instance,by focusing on its strengths,the Turkish city of Gaziantep has emerged as the world leader in carpets production.and now gives tough competition to Belgium and China10.Finally,building cities as D

35、istributed Hubs of Talent enabled by a robust digital infrastructure could emerge as a very successful third model for city economy development.Even before the COVID-19 pandemic,a survey suggested that most people living in Indias metro cities are willing to take a pay cut of up to 40%11 to move to

36、smaller towns,where the comparable quality of life is better.Today,in the wake of the pandemic,Indians are already embracing new ways of work.Indeed,many companies,including India,recognize today that virtual employment is not just possible but it could offer cascading benefits for employers and emp

37、loyees alike.Virtual work does not only lower operations cost,but it has limited negative effect on employee productivity.No surprise then that leading tech majors such as Facebook,Twitter,Google and TCS are testing either a complete virtual or a hybrid working model.Cities too are experimenting wit

38、h this idea.Venywhere,launched in Venice,Italy,is an initiative aimed at remote workers and freelancers where the city creates attractive platforms for work-from-anywhere programs.10.https:/ 11.https:/ Boston Consulting Group 2023 7III.Developing Robust Transport ConnectivityRobust public transport

39、networks deter the use of cars and private vehicles,decongest roads,reduce carbon emissions,and lower property price escalations near city centers and business hubs.Globally,several cities have prioritized solving for urban mobility by developing last mile ecosystems and a dense network of public tr

40、ansportation.Lisbon,for instance,in its 2030 mobility vision plans to introduce 12,000 e-scooters to embrace micro mobility as a last mile solution.Yet,mobility solutions cannot have one-size-fits-all approach,with different solutions,for instance,for satellite cities,industrial cities,or tourist hu

41、bs.Consider satellite towns which often benefit from the development of high-speed transit connectivity to a large city.In China,the completion of the Wuhan-Guangzhou HSR cut the transport time between the two cities from 11 hours to 3 hours.Indias own Regional Rapid Rail System(RRTS),which was laun

42、ched to connect the National Capital Region of Delhi with Meerut,Alwar and Panipat will reduce travel time by third in comparison to driving by road.IV.Enabling Multi-faceted Private Participation in Governance Private participation in governance:Urban governance needs a paradigm shift to breathe ne

43、w life into our cities.While many agree that a large-scale shift is needed to decentralize planning and empower local bodies,it is not a sufficient solution on its own.Building a progressive governance model requires the active involvement of all important stakeholders and a combination of first,an

44、empowered local government with a strong municipal leader and self-sufficient finances;second,a private sector focused on generating wealth and employment but in a sustainable manner by investing back into the city ecosystem that enables it to operate efficiently,and,finally,third,a civic society th

45、at fosters meaningful dialogue,takes joint accountability,and promotes the needs of various interest groups12.12.https:/mirror.unhabitat.org/downloads/docs/WG_B_Background_Urban_Governance&the_PrivateSector_draft0.pdf Boston Consulting Group 2023 8 For a resource scarce economy such as India,it is c

46、ritical that the resources and expertise of private sector are leveraged optimally.As per UN-HABITAT,the private sector can engage in good urban governance via standalone initiatives,PPP projects,private sector associations and guiding stakeholders in policy decisions.Indeed,PPP models that incentiv

47、ize the private sector to participate in both capex and O&M models can be instrumental in accelerating efficient city infrastructure development,while also improving service delivery to citizens.Take the example of Shenzhen,which embraced the private sector since the early days of its boom from esta

48、blishing tech companies in the eighties or raising municipal bonds and finances.In India,Jamshedpur is an excellent example of the role private sector can play in a range of areas of city development.V.Developing Compelling Resilience PlanOur cities are facing unprecedented vulnerability today owing

49、 to climate change,from hurricanes and cyclones to earthquakes and tsunamis.Loss of life and property,increase in unemployment,chronic food shortage and health scares are just the tip of the iceberg.Any adverse event not only alters a citys safety net,but it takes decades to recover from the shock.W

50、e can no longer rely on reactive planning and decision making to tackle climate change.We must strengthen the resilience of our cities with urban ecosystems that can swiftly recover to normal following a disaster.To achieve this,we must first empower city municipalities and enable them to become the

51、 first line of response.After the 1995 earthquake,Japanese city Kobe developed a long-term restoration and disaster management strategy that focused on developing preventive measures and risk communication activities.Today,it is a model for disaster risk management13.Second,cities need to develop a

52、disaster risk resilience and funding plan that prioritizes specific budget allocations for disaster recovery.For example,in the Philippines,cities allocate 5%of their local budget to a calamity relief fund,while 70%can be allocated for relief and rescue equipment.Third,we must build disaster-resilie

53、nt critical infrastructure such as 13.https:/www.oecd.org/cfe/regionaldevelopment/resilient-cities-kobe.pdf Boston Consulting Group 2023 9hospitals,schools,and network infrastructure such as roads,rails,sewerage,electrical and communication systems.Although costly,it is the resilience of our network

54、s and connectivity that can help bring back a city to its pre-disaster levels.ConclusionThe planned economic and physical development of our 50 NextGen cities will be pivotal in achieving accelerated,equitable and sustainable development.The adverse impact of centralized uncontrolled organic growth

55、is already visible to us with many of our large cities struggling with pollution,congestion,and poor quality of life.The time to act is now before it gets too late for the next 50 cities.AuthorsSuresh SubudhiManaging Director and Senior PartnerMumbaiSaurabh BakliwalManaging Director and PartnerNew D

56、elhiShubhika BilgramiLead Knowledge Analyst,Team LeadDubai Boston Consulting Group 2023 10 About Boston Consulting GroupBoston Consulting Group partners with leaders in business and society to tackle their most important challenges and capture their greatest opportunities.BCG was the pioneer in busi

57、ness strategy when it was founded in 1963.Today,we work closely with clients to embrace a transformational approach aimed at benefiting all stakeholdersempowering organizations to grow,build sustainable competitive advantage,and drive positive societal impact.Our diverse,global teams bring deep indu

58、stry and functional expertise and a range of perspectives that question the status quo and spark change.BCG delivers solutions through leading-edge management consulting,technology and design,and corporate and digital ventures.We work in a uniquely collaborative model across the firm and throughout

59、all levels of the client organization,fueled by the goal of helping our clients thrive and enabling them to make the world a better place.Boston Consulting Group 2023.All rights reserved.For information or permission to reprint,please contact BCG at .To find the latest BCG content and register to receive e-alerts on this topic or others,please visit .Follow Boston Consulting Group on Facebook and Twitter.