Beginning in 2015 under the NDA government, AMRUT lasted seven years. The Secretariat takes stock of AMRUT and AMRUT 2.0, which was relaunched in October 2021, to achieve its pledged goals by 2025-2026.

The AMRUT budget is Rs 50,000 crore for five years, which covers only 1.25 per cent of the expected cost. If one adds Smart City allocations of Rs 48,000 crore, it remains 2.5 per cent of the overall estimated cost, excluding inflation. To be fair, if we consider only central funding under AMRUT and smart cities combined, this number rises to 5 per cent. These allocations are for five years compared to the 20-year estimates of the High Powered Expert Committee (HPEC) report made in 2011.

The HPEC had estimated that India would need to invest, over 20 years, Rs 39.2 lakh crore for urban infrastructure development, with Rs 17.3 lakh crore for urban roads, and Rs 8 lakh crore for water supply, sewerage, solid waste management, and stormwater drains etc. All these were assessed at 2009-10 prices.

This isn't the first large-scale infrastructure and urban renewal scheme: The Jawaharlal Nehru National Urban Renewal Mission (JNNURM)'s Basic Services to the Urban Poor (BSUP) mission was a precursor from 2005 to 2010 under the UPA. AMRUT is distinct from it when comparing criteria for city inclusion, funding distribution, total and actual outlays, and project selection. JNNURM chose cities based on population. AMRUT lists prerequisites: cities should have geospatial mapping capacities, master plans, and dedicated departments for each utility. This ends up excluding underdeveloped cities that require urgent attention, a fundamental shift in approach.

The funding pattern has changed and competition for funding has been introduced. Under JNNURM, the centre wouldn't allot a larger share to Tier 3 and 4 towns compared to the state and the city. Projects from individual cities were individually reviewed using a competitive format to support underdeveloped settlements. Under AMRUT, cities have to compete and enhance implementation vis-a-vis others to win projects in the next financial year.

JNNURM, Smart Cities Mission And AMRUT

Lasting from 2005 to 2012, JNNURM targeted 65 cities, including 30 historic/religious towns (Category C), 28 cities with populations ranging from one to four million (Category B), and 7 cities with populations of four million or more (Category A) (as per the 2001 Census).

Its focus was not just on essential services and infrastructure, but on developing further urban governance under the 74th Amendment Act. The centre budgeted Rs 66,085 crore for this purpose and spent an actual Rs 47,697 crore.

The funding structure involved the centre, the state and the city. Thus, the funding ratio for Category A cities was 7 (centre):3 (state):10 (city), for Category B it was 5:2:3 and for Category C, it was 8:1:1. Larger cities gained more financial responsibility for running JNNURM programmes and the centre gave more to smaller cities and demanded less from them.

The Smart City Mission (SCM) was launched in 2015 by the Narendra Modi government. At its core, a renamed JNNURM, the criteria for a city's inclusion and the share of the state and centre changed significantly. JNNURM treated cities equitably on their size and population, the SCM chose 100 cities that had: 1. a master plan, 2. digitised maps, 3. an open data platform, and 4. regulatory bodies for each utility, to name a few. These terms excluded a large number of smaller towns in need of funding.

Furthermore, the budget allocated for this was Rs 48,000 crore, roughly the actual JNNURM spend. JNNURM began in 65 cities while SCM picked 100 cities. The funding pattern was changed to a blanket 1:1 (state: centre), eliminating differential treatment of smaller and less developed areas.

Little changed under AMRUT, apart from taking up 500 cities compared to the SCM's 100. With the goals the same, the Rs 50,000-crore budget had to now fund 500 cities but the funding pattern remained unchanged. With no say in the cities, it ended up centralising decision-making, a feature of this regime.

Previously under JNNURM, the centre would assess each individual project and approve it. Since the SCM came into being and under AMRUT, states submitted annual plans as a whole, and the centre gave funds depending upon who did best.

The Challenges

Absence of decadal data: Both AMRUT and AMRUT 2.0 hinge on Census 2011 data, leaving out cities that crossed the 75,000 to 1 lakh population threshold during 2015-2020. Many settlements might have transitioned from lower-tier to higher-tier cities given the dynamic nature of urbanisation and migration.

To manage a mission of this scale, the absence of a national-level, standardised dataset, is crippling. The stark reality is that over the past 14 years, India's urban infrastructure and renewal initiatives have been anchored on the 2011 Census. Therefore, city populations remain unrevised, the growth of towns into higher tiers is untracked, demographic shifts post-COVID-19 are unknown, and migration patterns for the period remain elusive.

Targeting cities that are better off than the national average: Another major reason why AMRUT may not be as effective is that cities selected already have higher living standards than the national average with exceptions. Similarly, many cities that could have been selected have been excluded.

For instance, housing congestion in AMRUT-designated cities (30.6 per cent) is lower than the national average (32.94 per cent). Access to tap water in chosen cities (66 per cent)is higher than the national average (62 per cent). The same is the case with access to electricity, latrines, and drainage.

Minuscule budgetary allocation for a huge task: Despite spending lower than projected expenditure, JNNURM did better in terms of allocations than both SCM and AMRUT. It allocated about Rs 65,000 crore for 65 cities.

The 2011 HPEC recommended a budget of Rs 39.2 lakh crore for 20 years. This translates to at least Rs 5 lakh crore over five years, excluding inflation. The current budget figures are nowhere near this. The maximum is Rs 50,000 crore (central share), which is budgeted and not the actual outlay. States have repeatedly spoken up on the lack of adequate central funding.

Unaddressed intra-city disparity: Recently, the PM emphasised on competitive federalism along with cooperative federalism. This is one of the main reasons AMRUT relies on outcomes-based funding which means funding becomes variable to each city, depending on its outcomes in the previous financial year.

This is not the most substantive way for rapid growth. With each city getting equitable assistance, it was better under JNNURM. This is something AMRUT 2.0 should process and internalise. By focusing on its fine print, AMRUT left out a lot of lesser cities and towns that already experience water and housing shortages.

Potential Pathways For The Future

Improved budgetary allocations: Allocating a mere fifth (extrapolated without considering inflation) of the HPEC recommendation falls short of current needs, considering the scale of urbanisation, migration, and the imperative for robust infrastructure systems to seamlessly support our cities.

Eradicating Intra-city competition-based model: Reinstating the JNNURM approach, which assesses and approves individual projects based on the city's capacity, is advocated instead of cities competing for funding and project approvals, in view of the extreme regional inequalities and the need for inclusivity.

Improve funding split: The SCM and AMRUT eliminated financial contributions from cities and removed them from budgeting and decision-making. It also failed to address inequalities between cities effectively while JNNURM ratios were more equitable.

Create priority lists of settlements that need more urgent attention: After resolving the two points above, AMRUT should consider removing exclusionary terms such as having a master plan etc. Instead, it could establish priority categories for relatively underdeveloped cities with smaller populations near major urban centres. This would simplify the process and prioritise areas with specific needs and would foster more inclusive urban development.

Rank size vs primate cities: Instead of heavy investments in primate cities, governments should embrace a rank-size citymodel, featuring numerous urban centres rather than a massive city like Mumbai or Bengaluru within their respective states. Prioritising smaller cities would evenly disperse migration and promote economic growth.

Datasets: Last but certainly not least, let's focus on data. The Secretariat has consistently underscored the repercussions of the absence of decadal Census data and the inefficiency in national urban datasets like Amplifi. It stresses the necessity for prompt, standardised measures to ensure accurate estimations for policy formulation and revision, advocating for reliance on verified and consistent datasets.

While assessing the post-Covid situation, AMRUT should broaden its mandate to encompass nutrition and health. Access to nutrition has resulted in increased GDP in 2019-20 and including these could boost growth while also improving citizens' social security.

This will happen only if we stop cities from competing for funds and instead improve inclusion criteria, financing patterns, and funding allocation, as well as empower local governance for cities to make their own decisions.