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The much anticipated Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (“the Act”) has just come into force in India on January 1st, 2014. Unlike the replaced 1894 legislation, this act addresses the rehabilitation and resettlement of those who depend on land, in addition to land owners. As emphasized in its title the new act places a greater emphasis on transparent processes at various stages: for example, through its mandatory social impact assessments, public hearings, and dispute resolution mechanisms.
The other key emphasis in the act’s title refers to a new compensatory mechanism. The new act now provides for up to two times market value, against one time in the previous act and this figure is then doubled by applying a one hundred percent “solatium” against 30% in the previous act (additional compensation). Though people get more compensation under new act, an increase in multiplier does not address the fundamental question of determining “market value” in a country where registered values under-represent land purchase price to evade high stamp duties. The challenge is exacerbated in rural areas where there are fewer land transfers, and therefore fewer registered sales deeds to use as reference points. In such situations, a valuation that is perceived to be more “fair” can be found only through consultations and dialogue, as demonstrated by two case studies from World Bank financed projects in India:
I will never forget October 8, 2005, a day that changed my life forever as it did for hundreds of thousands of Pakistanis.
I remember my house shaking violently like never before and my instinctive reaction to get myself and my family to safety outside the house. This was an earthquake that felt distinctly different from others. Things were shaking and moving too much and for too long. When we started seeing plumes of smoke rising from where a high rise apartment building had once stood, we knew this was really bad. Watching the terrified look of affected people on TV shook me inside and forced me to think about difference I could make. When I went back to my job and my life, the question kept nagging at me. When I was presented with the opportunity to work on the earthquake reconstruction project for the World Bank, I took it and have never looked back.
For centuries, cities have been the beacon for economic prosperity. Drawn by the promise of economic, social and political opportunity, more than half the world’s population live in cities today. In India alone, 90 million people migrated from farms to cities in the last decade. The prospect of higher wages and better living standards is expected to draw 250 million more by 2030.
Urban success is based on economies of agglomeration -- where density increases the ease of moving goods, people, and ideas – increasing productivity. However, compared to other emerging economies, Indian cities do not appear to have captured gains from economic concentration. While the service sector and high-tech manufacturing have benefitted from agglomeration more than other sectors, overall urban productivity has not kept pace with India’s economic growth. In fact, the urban share of national employment has not increased between 1993 and 2006.
Are the costs of density overwhelming the benefits from clustering?
Losses due to disasters to human and physical capital are on the rise across the world. Over the past 30 years, total losses have tripled, amounting to $3.5 trillion. While the majority of these losses were experienced in OECD countries, the trend is increasingly moving towards losses in rapidly growing states.
In a sense, increasing risk and losses caused by disaster are the byproduct of a positive trend - strong development gains and economic growth. This is because disaster loss is a function of the amount of human and physical assets exposed to seismic or hydrometeorological hazards, and the level of vulnerability of the assets. The richer a country gets, the more assets it builds or acquires, and therefore the more losses it potentially faces.
Rapid development across South Asia signals the need to commit greater efforts to increase resilience to disaster and climate risk. It also requires governments to develop a strategy to both protect against events today and to develop strategies to address the losses of the future. This is a challenge somewhat unique to South Asia. The losses of today, predominantly rural flooding that impacts wide swaths of vulnerable populations, will begin to diminish in relative importance to the losses of the future.
Within the next 30 years, urban populations in developing countries will double and UN-Habitat estimates that around 3 billion people will need housing and basic infrastructure. Already, 70% of existing housing in developing countries is built informally without appropriate structural standards. Thus, the challenge lies in reconciling informal settlements with existing and future planned environments.
In light of these challenges, the South Asia urban team at the World Bank, as part of its urbanization webinar series, organized a discussion on “Upgrading Housing in Informal Settlements.” This webinar highlighted the challenges of upgrading housing in informal settlements, and shared lessons from around the globe where targeted policy interventions and grassroots movements have mobilized resources to create success stories. Guest speakers and experts around the world joined the discussion on informal settlements.
On the second day of the three day regional workshop on affordable land and housing in Thimphu, Bhutan, country representatives continued to share policies and projects that their countries have devised and implemented and with that, the ideas that have or have not worked. One common theme was the interest in the development of secondary cities either around the periphery of rapidly urbanizing growth centers or as growth nodes strategically located along infrastructure such as regional transportation networks to create a ‘system of cities’. These growth centers often present a wealth of opportunities for the poor who flock to the cities from villages with the aspirations of a better life. However, this influx often strains the city’s services and infrastructure at an unsustainable rate.
Many regions and countries face urbanization challenges, South Asia is no exception. Although the region is currently the least urbanized region in the world, its urbanization rate is on par with Africa and East Asia with a projected influx of 315 million into urban areas by 2030. As such, the World Bank flagship program on urbanization strives to link key policymakers and practitioners to promote a more efficient urbanization process in South Asia through the exchange of experiences and ideas. The 3rd workshop in this series gathered over 80 professionals from 7 South Asian countries, the World Bank and the Korea Research Institute for Human Settlements in the beautiful city of Thimphu, Bhutan.
According to recent estimates, South Asia is facing a shortage of 38 million housing units, largely affecting low and middle-income households. It comes as no surprise that informal settlements, slums and squatters are growing in all major urban centers across Asia to supplement the demand from urban poor. India alone has 52,000 slums inhabited by 14 percent of its total urban population. Almost, 50 percent of total population in Karachi, i.e. 7.6 million persons, lives in Katchi-Abadis. Bangladesh has 2,100 slums and more than 2 million slum dwellers in Dhaka. Even in Afghanistan, 80 percent of residents in capital city, Kabul, live in informal settlements.