Localising green transitions in India
The article has been authored by Sam Downes, Saurabh Modi and Jagan Shah at Artha Global, a research and consulting organization.
At COP-26 in November 2021, the Government of India announced a five-point plan to tackle climate change, including an ambition to reach net zero emissions by 2070. The multi- pronged nature of the plan, including a shift of 50% of India’s energy mix to renewables by 2030, acknowledges that reaching ‘net zero’ presents a wide and diverse set of challenges.
The pathways to achieving such laudable ambition are still to be determined. Diverse sectors of the economy, from heavy industry to transport to energy to agriculture, face tough choices on how each will drastically lower their emissions, and when. Sequencing the steps that need to be taken will require a unified narrative and an integrated approach if economic growth is to be maintained.
Urbanisation must sit at the centre of the government’s vision for net zero. By 2050, around half of the total population will live in towns and cities. India’s economy will also be urban, with 49 metropolitan clusters projected to account for 77% of incremental Gross Domestic Product (GDP) growth between 2012 and 2025. Plans to decarbonize will have to proceed in lockstep with these trends. Whether it is the energy demand of buildings, transport emissions from packed roads, the fumes of industry on city fringes, or the lack of infrastructure connecting rural townships, all of India’s net zero transitions will manifest in and around its urban centres, meaning they will have to expand sustainably if both growth and decarbonization are to be achieved.
How India is urbanising must change if it is to be compatible with a net zero agenda. In 2016, the World Bank described India’s urbanisation as ‘messy’ and ‘hidden’, referring to both its unacknowledged scale and unplanned character. Since 1991, the country’s urban population has grown by 250 million. Cities and towns can sprawl for miles without adequate infrastructure and services, and have become environmental hazards, prone to flooding, extreme heat and pollution. They also spew emissions, contributing around two-thirds more per person than rural areas do.
How urbanisation unfolds comes down to how land is governed. Governments must take granular decisions about what function each piece of land can serve, who can develop it and how flows of people, goods and resources affect its value. They must keep records of who owns the land and consider how transactions of land can be made easier. They must manage the relationships with and between those on the land, whether residents, businesses or public agencies. They must consider the value of the land and the costs of maintaining what is on it. They must consider where public goods, such as hospitals and schools, should be placed. These are the kinds of issues that inform the broad discipline of urban planning and governance.
India’s local governments are not equipped to govern land effectively. Staff lack basic skills, such as in finance and human resources. Technical skills, such as in climate sciences and urban planning, are rarer. Data on how cities function is poor and plans for future growth have historically been restrictive, partial, and worsened by messy regulation. The proportion of land designated as public space, which includes roads, green areas like parks and other public infrastructure, is as low as 10% in some city districts, compared to the international standard of 30-40%. Poor decisions in urban planning have been linked to serious water scarcity and flooding. Continued misgovernance and failure to act in the face of sprawl, pollution and congestion could cost between a projected $330 billion and $1.8 trillion per year by 2050, or 1.2--6.3% of GDP.
Poor local governance is undermining each of the key transitions that India must go through to reach net zero – in energy, transport, industry and agriculture. Whether it is the regulations around the energy efficiency of buildings, infrastructure choices that promote road use, industrial placement on city fringes, or the lack of infrastructure connecting rural townships, local government’s ability to monitor change, plan for development, enforce regulation, and work with the public, private and not-for-profit sectors threatens to stand in the way of progress. It is equally arguable that if they are reformed, they could boost India’s achievement of national targets and ambitions.
Furthering India’s path to decarbonization in urban areas requires addressing the causes of poor local government capacity at its root. Cities are over-reliant on Union and state governments to implement policy and development programmes. According to the World Bank, India is the 68th most decentralized country in the world, among 182 countries, while China, its only equivalent in size, is ranked 21. Funding is centralized too, with local governments relying on transfers from the Union or state governments to fill their coffers. This leaves local governments with scarce resources and little ability to think and work strategically, hampering the delivery of public goods, to manage growth and withstand stresses and shocks. The challenge particularly hits India’s secondary and tertiary cities, leaving them even less room to shape urban growth.
India must find a ‘green’ way to grow its urban areas. In order to do this, the Government of India and state governments must restructure policy implementation so that local governments become the primary delivery units, at the frontline of development and growth. The legislative approach, through the 74th Constitutional Amendment, has created the room for state governments to implement devolution. Results, however, have been achieved through closer coordination of departments and programmes, as evident in the Union government’s ‘Aspirational Districts’ programme.
A whole-of-government approach is needed to bring about the necessary convergence. Union and state governments will continue to plan for decarbonisation and set the regulatory framework for implementation; however, they need to enable delivery as close as possible to the sites of action, where development and growth manifest. Urbanisation is the context within which each part of the government must play a specific role while reconciling potential conflicts and stresses. India must transform its urban centres to secure its development trajectory in the direction of a just and green transition. In this paper, we present the following scenario, with decentralised interventions at each tier of governance, as a path forward:
1) The Union government establishes a National Green Growth Platform that supports implementation at all tiers of government.
The Platform will integrate development monitoring indicators and greenhouse gas inventories with geo-spatial data, so that the economic and environmental impacts of transitions in energy, transport, industry and agriculture can be located and their interactions with urban areas understood. Geospatial intelligence is essential for coordinating the country’s net zero strategy across sectors and scales. The decision by the Government of India to follow an “area-based approach” for the Gati Shakti initiative, meant to speed up the provision of connectivity infrastructure across the country, already anticipates the demand
for such a platform approach. A concerted effort will be required to improve data availability and quality at the local level, building on the ideas of the Smart Cities Mission and the Aspirational Districts Programme.
2) State governments provide strategy, oversight and resources to local governments.
States must be re-envisioned as custodians of federal and regional development, holding lower tiers of government to account for district and local area plans and providing more support where capacities are poorest while allowing them to lead on development. Efforts such as updating planning norms and building and environmental regulations and improving land records will provide the lower tier with the framework they need to deliver on the ground.
3) Municipalities and districts become first responders and planners, working hand in hand with the private sector and civil society.
With clearer roles for state and Union governments and better support and information for decision-making, urban local bodies and districts can prepare green growth and development plans informed by their local and regional context in all respects: economic activities, land markets, urban form, environmental impacts, and natural resource management. Evidence-based and sustained engagement with citizens, civil society and the private sector will strengthen the local governments ability to plan and deliver low carbon development projects and public services. The third tier of government will need to enhance its own capacities by mobilising local communities and private sector actors to bring about a broader consensus around plans and budgets.
4) Cities improve revenue streams and financial self-reliance, unlocking Union funds with state government support and securing green finance by de-risking and safeguarding Investments.
Increased and timely devolution of funds must become the new normal and revenue opportunities like public land monetisation and carbon taxation should be explored. To ensure investors have the information they need at the local level, information must be spatially correlated. Mechanisms like the National Bank for Financing Infrastructure and Development and state level funds must work with municipalities to secure finance. Financial market regulators, Reserve Bank of India and the Securities Exchange Board of India must bridge the green information gap.
You can read the full report here
(The article has been authored by Sam Downes is a junior fellow, Saurabh Modi an associate and Jagan Shah a senior fellow at Artha Global)
