The Xurbia Revolution: Bridge to a Developed India
I enjoy the time I can get away from the
hub-hub of the city. On my way to the mountains, I find the small towns I pass
through pleasurable and realize they are a gateway from the bustle of the city
to the rural bucolic.
A critical difference between the developed
and developing worlds is the level of urbanization. While 75% of the developed
world's population is urban, the number in the developing world is 45%.
Despite its rapid economic growth over the
last two decades, in 2022, only one out of three Indians lived in an urban
area. The United Nations projects that by 2030, the percentage of Indians living
in urban areas will be 41%.
By 2047, India's rural population
percentage will remain comparable to its urban population. This unique
urban-rural balance has profound economic, social, and cultural implications on
India's path to becoming a developed nation.
Crucial to this dynamic is for India to
develop a natural and durable bridge between urban India and rural India, a
bridge between agriculture and industry and a bridge between economic
productivity and quality of life.
Mckinsey Global Institute estimates that by
2030, India's urban population will be 590 million (39% of a total population
of 1.5 billion). They project that there will be 13 Tier 1 cities (population
of more than 4 million each) accounting for 155 million people (26% of total
urban), 55 Tier 2 cities (population between 1 to 4 million) with 104 million
people (17% of total urban) and 6000 Tier 3 and 4 towns (population less than a
million) with 331 million people (57% of total urban).
According to current projections for rural
and urban productivity, by 2030, urban India will account for 70% of India's
GDP. However, current predictions will not make India a developed nation with a
$32 trillion economy by 2047. If India is to achieve that goal, rural
productivity must grow from 50% of urban productivity today to at least 75% (I
have written about this in an earlier article on rural India).
Further, if India is to become a truly
developed country by 2047, the quality of life across urban and rural India
must also transform.
The bridge from today's developing India to
tomorrow's developed India is in the economic growth and quality-of-life
potential of India's 6000 Tier 3 and 4 cities—a bridge I call Xurbia— the X
ingredient that will fuel India's ascent to developed country status.
Imagine thousands of Tier 3 and Tier 4
cities that offer their citizens good economic opportunities and quality
educational, medical, cultural and entertainment facilities.
Imagine every Tier 1 and 2 city being
within a 1–2-hour ride (over modern highways or highspeed commuter trains) to a
cluster of Tier 3 and 4 towns sustaining a symbiotic economic, social and
cultural relationship with it.
Imagine that most rural communities in the
country are an hour away from a well-functioning Tier 3 or 4 town that offers
its children and youth excellent education, training, and jobs, its people good
medical care, and its rural economy an easy interface with modern technology
and processes.
As I see it, a town in Xurbia has a school
that is as good as any in a big city. The school could be a public-private
non-profit institution, accommodating all the children from the town and the
cluster of rural communities it serves. It would also have a good higher
education college and a vocational training institution. A town in Xurbia would
have a hospital that is well-equipped with medical staff and diagnostic
equipment and attached to a big hospital in a Tier 1 or Tier 2 city for
e-consultations with specialists, as well as a modern ambulance service that
can transfer patients to it when needed.
A town in Xurbia will have at least one
modern manufacturing unit, knowledge services (ITES, Business Services), and an
R&D set-up (perhaps a Global Capability Center). It also will have a
processing and packaging unit that adds value to the agricultural produce of
the rural communities it serves. Further, a town in Xurbia would be a place to
live for commuters who work in nearby Tier 1 or 2 cities. The above would make
the Xurbia population well-educated and well-to-do, attracting and sustaining
good shopping, entertainment, and other consumer services. A Xurbia community,
working with local authorities, could build a central green space, a community
center with a library and an event space and maybe even a small museum
commemorating a bit of Indian history, a music genre, a sport, or a local hero
(many small towns in Europe and the US have such museums that give the town a
personality and even attract tourists. I remember spending a rather exciting
hour in the House of HG Wells in the small town of Sandington in the UK).
The creation and nurturing of India's
Xurbia will require meticulous planning and support from the central and state
governments, similar to the current Aspirational Districts program. It will be
done in phases, focusing on a few States with carefully chosen Tier 2 and 3
towns to maximize their Tier 1 and 2 cities and rural community footprints.
In their paper "India's Urban
Awakening: Building Inclusive Cities and Sustaining Economic Growth,"
McKinsey estimated that Indian cities needed to spend $1.2 trillion on capital
over the next two decades, equivalent to $134 per capita per annum. Since the
study was done in 2010, we could add a 20% cost inflation to the estimates.
If the Xurbia revolution is to happen, we
will need to allocate resources to Tier 3 and Tier 4 cities, at least in
proportion to the size of their populations, which would mean $ 820 billion
allocated to the Xurbia revolution over 20 years with each selected town
getting a capital expenditure budget of $160 per capita per annum meaning a
Tier 2 town of say a, 2 lakh population would have a . expenditure budget of $
32 million a year, adequate to build the school, the hospital, the community
center, green space especially if done through a privatepublic-partnership while
attracting private investment in the factories, the services businesses and
agriculture processing. The resultant prosperity level of the population will
fund operating expenses through local taxes and attract good shopping and
entertainment.
The numbers above are testimony to the
feasibility of unleashing an Xurbia revolution in the country that will be
integral to India reaching its goal of becoming the only developed country in
the world with over 50% of its population still rural but well-connected to the
modern world through a network of Xurbia towns and as productive. India will be
a uniquely developed country with a teeming metropolis whose quality of life is
symbiotically linked to a nearby Eden like Xurbia.
Our cities are full of people who come from small towns and bring to them the talent in sports, the arts, technology, and business that makes them boom. However, talented newcomers to a city have to work hard in their initial years to find the quality of life and the time to nurture their talent. With the Xurbia revolution, talent will be more widespread and easier to grow, leading to an economic and quality-of-life boom spread evenly across the country.
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