Prime Minister Narendra Modi’s vision “Digital India,” has set an ambitious plan to build 100 smart cities across the country. PM Modi in his speech quoted, “Cities in the past were built on riverbanks. They are now built along highways. But in the future, they will be built based on availability of optical fiber networks and next-generation infrastructure.”
India’s Smart City plan is part of a larger agenda of creating Industrial Corridors between India’s big metropolitan cities in India. It is hoped that many industrial and commercial centres will be recreated as “Smart Cities” along with these corridors. About 25–30 people migrate every minute to major Indian cities from rural areas in search of better livelihood and better lifestyles. With this momentum, about 843 million people are expected to live in urban areas by 2030. To accommodate this massive urbanization, India needs to find smarter ways to manage complexities, reduce expenses, increase efficiency and improve the quality of life.
A smart city is characterised by an urban region having modern technological infrastructure, access to smart energy, smart mobility, smart public utility services and ultra fast communication network. The smart city benefits everybody – its residents, business persons and the government. These cities are generally considered the engines of economic growth, such a huge population in cities would be the biggest market in the world and may be the source of 80 per cent economic growth of the country. This amount of huge population would also require accommodation, jobs, civic amenities, efficient governance, fast communication means, speedy and hassle-free transport system, power, water supply and good quality of life. The Smart City Mission aims to provide the same to Indians.
How Smart Cities will Impact the Indian Real Estate ?
The growth of a Smart Cities can give way to massive opportunities to the real estate market. The tech sector is in full bloom, so developing districts and supporting businesses in this segment will create jobs and attract professionals, which means housing demands will increase. Population growth will have the same effect. Who wouldn’t want to move to a city with high-paying jobs, great public transportation, efficient communication with officials and modern resident services? Growing the standard of living comes naturally from smart cities.
Another aspect is that smart cities have lower operating costs, which means significant amounts of money can be redirected to other projects in real estate. Finding additional resources to invest in the city is always great news for developers who often use area amenities to market their properties. Cities applying new technologies or policies for a better quality of life will always be relevant, that attracts capital from real estate investors. A smart city project, along with real estate, also entails many possibilities across sectors like Information Technology, architecture, interiors, and other application designers who will be a part of the project.
Developers will get an amazing opportunity to offer new projects in the upcoming smart cities which boost the regional, social and economic infrastructure. Presently, the real estate sector contributes about 7% to India’s GDP. With the vision of building 100 smart cities, many expect this share to increase to 10-12 percent by 2030.
Smart cities will not only improve the quality of life for millions of Indians, but also create more jobs facilitating economic development and thus, more investment in real estate. It will also jump start to a capital from private enterprises and developers in real estate, towards joint ventures within the smart cities. The Smart Cities Mission is being accompanied by simple and transparent real estate transactions like RERA. This will facilitate lesser corruption and better transactions in real estate. If the government policies are favourable, many real estate companies within and outside India will invest in the future smart cities projects. This move will help bring a phenomenal growth in promoting modern living for the Indian community. It is a win-win situation for all!
This guest post has been written by Gunjan Johar.