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urbanization

Urbanization in India: Stronger Cities through Better Institutions

Mabruk Kabir's picture

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?

Is Upgrading Informal Housing a Step in the Right Direction?

Parul Agarwala's picture

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.

The Development of Secondary Cities in South Asia

Judy Deng's picture

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.

In Bangladesh, the Alternative to Urbanization is Urbanization

Zahid Hussain's picture

There is little empirical regularity that is as universal as the following: no matter what the path of economic development a country has followed, urbanization has been an inevitable consequence across the world. Already half the world’s population is urban. Currently, Asia and Africa are the least urbanized regions, but they are expected to reach their respective tipping points–that is when their urban populations will exceed the rural population–in 2023 and 2030. While the urban transition occurs with diverse growth patterns at different times, the real challenge for governments is to take actions that allow residents to make the most of living in cities.

The relationship between urbanization and economic development has long been a popular issue of debate. Should a developing country encourage urbanization? While this is a real dilemma in Bangladesh, because of a highly unfavorable land-population balance, the only alternative Bangladesh has to urbanization is urbanization. The question is not whether Bangladesh should urbanize; the question is how Bangladesh will handle the challenges of urbanization.

Voices of Youth: Green Dreams, Making Cities Serene

Sunera Saba Khan's picture

At the 9th South Asia Economics Students' Meet on Green Growth, participants shared their vision about South Asian cities of the future. These are their innovative ideas.

Without taking care of the environment we are shaving digits off GDP and, therefore, limiting our very potential for the future.

Economic growth in South Asia is driven primarily by exports which has led to expanded production requirements needed to fuel an ever increasing amount of trade. This has accelerated the environmental degradation of many countries in the region. Gradual environmental degradation, climate change and diminishing natural resources create extra pressure to adopt different approaches in supporting the export-driven economic activities. The past axiom of “grow first, clean up later” cannot run more in a region which has limited natural resources and a rapidly growing population directly dependent on natural resources. These countries are now shouldering an increasingly greater share of regional and global environmental production-related burdens.

Do Cities Matter?

Ejaz Ghani's picture

It is a paradox that India which is among the most densely populated countries in the world, is also among the least urbanized. The figure below compares urbanization rates with income for more than 100 countries. It shows that an increase in urbanization rate is positively associated with real per capita income. This is the iron law of development—i.e., growth is associated with the reallocation of labor and capital away from traditional (rural) sectors to modern (urban) sectors. Spatial transformations that give rise to urbanization accelerate growth because households and firms benefit from scale economies, mobility, and specialization. Increased urbanization contributes to growth, job creation and poverty reduction. This can indeed become a virtuous circle.