While India rapidly progresses economically, its social development remains poor. A comprehensive PURA approach can rectify these problems.
Gated communities promise heaven on earth to the well-to-do and nothing at all to the poor.
It is good news that the Ministry of Rural Development has sanctioned nine PURA (Providing Urban amenities in Rural Areas) projects with three important innovations. One, instead of concentrating on a single village (or even a single family) as is common, it has planned the development of a cluster of villages. Two, instead of the usual small projects of a few lakhs each, it has raised the scale to around a hundred crores of rupees. Three, instead of using NGOs only, the PURA is a truly Public-Private Partnership (PPP) with the Government contributing about 30 per cent of the cost and private enterprise the remainder. It is also a cooperative enterprise requiring the sanction of the local panchayats.
In its original form, PURA was more an exercise in social development than pure economic development. As such, high quality schools, healthcare and habitat development were an integral part of the scheme. As these amenities are expensive, PURA also incorporated middle-class families, which alone can support them. In order to attract them, PURA aimed to have modern businesses or locate itself close to such businesses for rural areas.
To induce middle-class families to reside at the PURA (rather than commute from large towns and cities) high-quality habitat development, markets, places for sport and entertainment were integral to the scheme. As PURA extends over several villages, an affordable mass transport becomes crucial to access the various amenities across villages.
Social development goals
These social amenities have been omitted only because the Rural Development Ministry has no authority over them. In fact, no ministry in the Government can develop rural areas in all aspects.
It is also not feasible for any ministry to propose any such comprehensive project. Only the Prime Minister's Office or the Planning Commission can do so and there is an urgent need for it.
A few weeks ago, farmers along the new Noida-Agra highway agitated against the UP Government's takeover of their land. Five farmers were killed in police action. Farmers have stopped the construction of the highway. Even a worthy project such as a highway is in trouble. The situation in Naxal-infested areas again needs no elaboration.
It is true that while India rapidly progresses economically, its social development remains poor, leaving its Human Development Index lower than even some sub-Saharan African countries. In the Millennium Development Goals, too, the country lags.
A comprehensive PURA can rectify these problems. Incidentally, urban development too suffers because it increases, not decreases, the slum population. PURA can indirectly curtail that problem by encouraging reverse urban-rural migration, particularly of the middle classes. Uneven development, which in turn is the result of lopsided investment, appears to be the bane of our planning process.
Lopsided investment
On per capita basis, our cities get a far larger share than rural areas. Cities are unable to absorb their largesse satisfactorily because far too little is allocated to social development. It is true that private capital is now expected to bridge the gap left by the State and this has benefited education, healthcare and habitat development. Unfortunately, as private enterprise is profit-oriented and the poor cannot present such profit, they remain neglected in these three areas as also in transportation. The XII Plan is currently being formulated and this is a good time to think of innovations in development. As major shifts in policy will have teething problems, it is desirable to start with a few experimental projects before finalising them.
Serving the poor quarter
Theoretically, according to the 80-20 rule, the top half of the population will command 80 per cent of the resources. Of the remaining half, the top quarter may command around 15 per cent, with the bottom quarter enjoying barely five per cent of the total. Hence, I suggest that we divide the population into three categories: The top half who will bear the total cost of services they receive; the next quarter who will pay marginal costs only; and the bottom quarter who will get the services virtually free. The problem is in getting PPP projects to follow this rule.
It is understandable that private entrepreneurs would like to maximise profits and exclude the bottom unprofitable part of the population. That is why we are so full of “gated communities” which promise heaven on earth to the well-to-do and nothing at all to the poor. Such lopsided development can be averted only when the State compensates private enterprise for any loss of profits.
One solution could be Government funding for such projects — as in the case of the Delhi Metro — through virtually-zero interest loans on condition that all habitations, schools, hospitals and transportation systems fully embrace the entire population; the top half paying both fixed and variable costs, the next quarter paying marginal costs only and the bottom quarter getting the service virtually free. That need not be compulsory; enterprises will take it up whenever the savings in interest cost make up for loss of profits in offering services to the bottom half.
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