A case for the rapid urbanization of India

["Dr. Sanjeev Sabhlok" <sanjeev@sabhlokcity.com>]

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     A case for the rapid urbanization of India
 						Sanjeev Sabhlok

1.	The bellwether of technological prowess
	Since the Industrial Revolution, modern technology has been characterised
by increasing and intense specialisation, division of labour, economies of
scale, and comparative advantage. Rapid migration into urban areas and the
subsequent enrichment of migrants through the various wealth-producing
attributes of technology is perhaps the single most important visual
indicator of the technological and intellectual prowess of a society. In
India, urbanization is still in the range of 28% to 30%. This low level of
urbanization places India close to the bottom of the heap of nations in the
world, and reflects our anaemic absorption of technology.
	There is a bit of a problem with this interpretation, though. In the
overall analysis, we have to think of more productive vs. less productive
rather than concern ourselves with geographical location per se. If one is
comparatively more productive working as a farmer, then one should be a
farmer. On the other hand, if one is more efficient in producing industrial
goods or services which are best carried out by one's residing in urban
areas, then one should do precisely that. Also, with changing technology,
some services which earlier needed an urban location can now locate in
rural areas. The optimality of urbanization exists precisely in relation to
the nature of technology.

2.	Inefficiency of rural locations
	Having said that, there is sufficient evidence to demonstrate that India's
overall residential preference today is not optimal, and further, our rural
infrastructure is such that we cannot move into the post-industrial era on
its back.
	There is talk of modernizing villages to overcome infrastructure
constraints including provision of internet access. While some
internet-based businesses could then possibly move out into semi-rural
areas, provision of full fledged infrastructure across all Indian villages
is not viable.  For example, supplying individually metered electric
connections to all villages in India is costly, difficult to monitor and
manage, and collecting revenues virtually impossible. Rural electrification
has consequently become "free" almost everywhere in India, with consequent
poor quality. It cannot sustain industry. So also with telephones, roads
and whatever else is considered modern. One is not saying that we should
freeze the supply of these facilities to villages, but that fully
modernizing villages is far less efficient than providing such services to
dense, urban areas. We need to recognize that villages will have to remain
villages, specializing in the production of agricultural products. They do
not need the highest quality infrastructure for that.
	More important, we should be concerned with the inefficiency arising from
wastage of idle brain power in rural areas. A human brain is like a
supercomputer. We are wasting half a billion super-computers in rural
areas. At a level of productivity currently about half that of China, we
can easily double our grain output in a single lifetime, using half the
people currently deployed, supplemented by the use of machines. A large
surplus of man-, or rather, brain-power will then be thrown up, ready to be
deployed in more productive work. This vast resource is currently bogged in
poverty by horrible economic policy and misdirected  subsidies. Good policy
 can release these people for effective work in urban areas.
	Consequently, in my view, people need to be encouraged and facilitated in
moving out to urban areas. This move toward large-scale urbanization will
give a major boost to national efficiency. As a spill-over, it will also
help reduce the demand for children and steeply bring down our population.

3. 	Optimal free choice
	Unfortunately, many policy makers and urban planners continue to talk of
strategies to keep rural folk from "swamping" the cities. Strangely, these
policy makers themselves invariably reside in urban areas and earn huge
salaries compared with the average peasant. Such "strategies" belie the
fundamentals of economics and the attributes of modern technology. Given
freedom of choice, the simple rule is that people migrate from areas of low
wage (marginal product) to areas of high wage. The behavior of our urban
migrants is ordinary, maximizing, behavior, of rational human beings
motivated by their free will to perform the best they can under the given
technology and environment.
	All we need to do is to ask slum dwellers why they care to live in a
miserable slum where there is so much filth. The answer will be "Paisa.
Yahaan paise hai. Gaon mein bhookh hai." These people have voted with their
feet for more money and better opportunities for themselves and their
children, above all other priorities. Let us help them earn more money and
achieve a life like many of us live, in fancy urban colonies.  These
migrants break up with their families for months merely to earn a few extra
rupees for their children back home. Some go to prostitutes because they
are away from family, get AIDS, and perhaps die like vermin. We need to
make it possible for them to bring their families to the cities and live a
life that we want our own children to live. Alas, at such thoughts, many of
our intellectuals gasp in disbelief!
	It is time to recognise that what is optimal for each of the migrating
individuals, must also be optimal for the nation, even counting the alleged
negative externalities, which primarily arise from our obtuseness and
inability to think. Let us therefore, respect these individual decisions of
people to move out to places where they can lead a better life, even in
slums.
There are also attempts made to beat the poor urban migrant with the
"culture" stick. The question of culture and community feeling surfaces in
such debates on urbanization. An idyllic picture is painted of rural areas
as places with a great sense of culture and community which must be
preserved and promoted for its own sake, while neglecting the free choice
of the migrants. But villages also happen to be places of mass-massacres -
in Bihar, Andhra, and Assam. In my tours to interior rural areas, I never
found any out of the ordinary "community feeling" holding the rural folk
together, except that they do know each other a little better individually.
But like any other place in the world, there are disputes over land,
murders and other crimes, as well as distrust of those belonging to a
different group. On the other hand, despite some urban residents living a
somewhat lonely life, they do, frequently, know many more people (not
necessarily their neighbors), and have a keen sense of community with their
nation and the world.

4.	Satellite townships and suburbs
	Large cities have grown the fastest in the past 50 years in India, as has
been the case all over the world. Big cities usually tend to get even
bigger. There is no known optimal size for cities, but large cities, if
properly planned, usually yield excellent returns to scale in the
production of goods and services of all kinds. Human density drives
innovation and wealth creation. We must therefore, plan for huge cities
with big satellites rather than continue to promote villages which become
"cities" by the mere accretion of poor and helpless migrants. Crowding,
pollution, delays, and inefficiency are the necessary outcomes of our
shoddy city planning. These are not natural to the process of urbanization.
	Good economic policy should set the ball rolling for rapid urbanization.
But to build good communities we need to invest a large amount of physical
and mental resources in planning cities. We need to build satellite cities
which are self-sufficient but well-connected and hence close enough to the
main Metro to feel "part of the big city". These will almost surely have to
be built on the pattern of the suburbs of the West, where you find families
out in the parks each weekend, enjoying sports with their children. The
more planned the urban centres are, the better the sense of bonding and
community feeling. While this model is coming under some attack on the
ground that it wastes energy, essential elements of this model need to be
imbibed by us, even in otherwise dense spaces. Vast recreational spaces
need to be designed and built into our urban complexes.
	Today, our urban planners perhaps rank as the most incompetent in the
world. They have little or no clue about the economic forces that
constantly swamp their feeble efforts to plan, and most of them never knew
about urban planning to begin with, anyway. We had and continue to have an
enormous deficit of higher education in urban planning and urban economics.
We have a huge surplus of engineers, whom we export, but a mind-boggling
deficit of urban planners.

5.	The case is clear
	From a variety of angles, in terms of reaching the production possibility
frontier of India, in terms of tapping into our massive but mostly unused
reservoir of human brain power, in terms of reducing the cost of provision
of infrastructure, as well as in terms of respecting each individual's
personal residential decisions, sensible urbanization is necessary.  If our
national goal is to promote rural areas or to reduce migration into urban
areas, then all we need to do is to continue to encourage illiteracy and
employ every other person in a government job (i.e., squander our human as
well as financial resources) and we would have succeeded. If that is our
goal then we can hardly do better than what we are already doing today, 53
years after independence.
	For India, good economic policy will be seen to have worked when we
generate a national vision for the creation of large, beautiful and clean
cities. Sauvik Chakraverti talks of 400 Singapores in India. I can not find
a more powerful vision statement for India. We should not merely look at
per capita incomes nor allow our fears of heavy migration into urban areas
to swamp our thought processes. Planned and rapid urbanisation will be the
true test of our understanding of economics.


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