India to get Many New Cities Soon

News Posted - 2010-07-20, Last Updated - 2010-07-20

Dholera is one of the five similar-sized greenfield cities that India hopes to build in the next few years. The other cities are Manesar-Bawal in Haryana, Indore-Mhow in Madhya Pradesh, Dighi and Nasik-Igatpuri in Maharashtra — all along the Delhi-Mumbai Industrial Corridor (DMIC). This means the plan is to have five brand new cities, which are bigger than Navi Mumbai, in the next five years. And the list is seeing new additions at a rapid pace. The Vijaynagar Area Development Authority in Karnataka is developing a new city in Karnataka. The area has the largest reserve for iron ore in the country and the new city would come up in a 570 sq km area, which has been identified and earmarked. The new city would have a capacity to accommodate a population of 5-10 million, on the basis of estimates. The Karnataka government also recently invited proposals to develop four cities of about 9,000 acres (around 35 square kms) each near Bangalore, according to a developer who has evinced interest in the project.

The Chhattisgarh government also recently came up with a proposal to develop a “New Raipur” over 25 sq kms. Amitabh Kant, MD and CEO of DMIC Development Corporation, said Dholera has an area of about “560 sq km urbanisable area of which 360 sq km is developable”. “It is bigger than what has been attempted in China or Korea so far. The first phase of the project would be completed by 2016. Dholera would attract a population of two million on completion,” Kant says.

GIDB already possesses over 50,000 hectares of land at Dholera. The cost estimate for infrastructure is estimated to be about Rs 38,000 crore and will create housing facilities for 5,00,000 people over 30 years, according to estimates by UK-based Helcrow who are involved in the master planning for the city.

The plan for industrial cities hasn’t come a day too soon. According to a McKinsey Global Institute 2010 report, 590 million people will live in Indian cities by 2030, almost twice the population of the US today. An investment of $1.2 trillion will be required to meet the projected demand in these cities, and about 700-900 million sq metre of land space needs to be built, or a new Chicago every year. The study states that India will require 20-25 new cities in the next 30 years near the largest 20 metropolitans by providing adequate infrastructure. But there could be a big bottleneck is funding. The success of these cities depend a great deal on getting private sector investment and the central government facilitating soft loans from multilateral agencies with a 10-year moratorium, at least.

Even the McKinsey study acknowledges that. “Building new cities is sustainable only when at least 300 to 400 million jobs are created, and each of these cities hosts a population of around 1 million, a landmark that usually requires strong anchor tenants and several years of incubation. International experience shows that it takes 15-20 years to reach this level of population, according to the McKinsey study.

A recent example of a big city coming up smoothly is the Hindustan Construction Company’s Lavasa city project in Maharashtra, billed as India’s largest hill city. Rajgopal Nogja, president of HCC Real Estate, said: “We have invested over Rs 4,000 crore in Lavasa of our total investment of Rs 47,000 crore. The area will draw an overall investment of Rs 1 lakh crore. We are also interested in developing Dahej in Gujarat as a greenfield city, besides developing one city in Himachal Pradesh and in Karnataka.”

The Gujarat government came up with a Special Investment Region (SIR) Act in March 2009 for setting up new cities in the state, driven by industrialisation. About 12 such special investment regions have been identified and given to agencies for master plan so far with two more in the offing. These include Sanand, Dholera, Changodar, Santalpur, Hazira, Navlakhi, Simar, Pipavav, Dahej, Anjar, Okha, Aliabet, Savli and Halol. “The minimum size for an SIR is 100 sq km,” sources said. Aliabet, which will house townships for the Japanese, has been identified as an entertainment zone SIR to come up on about 100 sq km, said sources. While Hitachi and Mitsubishi-led consortiums have been selected by DMICDC for laying out plan for developing ‘Smart Cities’ in Dahej and Chagodar respectively, Toshiba and JGC Corp-led consortiums will give shape to Smart Cities in the Maneswar-Bawal region of Haryana and Shendra industrial region in Maharashtra.

Source : http://images.indiaproperties.com/newsletter/archives/July10.html#ne