Major Obstacle in creating Charter Cities

The major obstacles in creating charter cities are

1. Lack of Political will: The recent major example is Madagascar which considered creating two charter cities, but the scrapped the plan when the political leadership that supported the idea was removed from power.
2. Lack of clear guidelines: There is need to educating the people on charter cities because some time it becomes major point of contention between people living in charter cities and people living outside the boundary.

Paul Romer Video on Charter Cities

http://www.youtube.com/watch?v=mSHBma0Ithk

Objective of this BLOG: To create a blueprint of rules and regulations for developing a charter city in India

Updated based on discussion with Nagendra sir on 3-Jan-2011.

Charter City concept cutting the chord in India

The following investments in the area of integrated townships in India indicates the future of this market:

·         ICICI Venture and Tishman Speyer’s 50:50 JV, TSI Ventures, in consortium with Nagarjuna Constructions, are developing a 400 acre integrated township at Tellapur, Hyderabad. The township will be a mix of commercial and residential complexes as well as recreational spaces. When completed, the development will be home to over 30,000 people and will provide office space that will generate over 35,000 jobs.

·         The Ozone Group is planning an integrated township on 43 acres in Chennai for Rs 300 crore. According to a press release, the deal is backed by HDFC and Reliance.

·         Malaysian property developer Sunway City Berhad has partnered with Hyderabad based Opus Developers & Builders on a Rs 800 crore township on 14 hectares of land near Hitec City in Hyderabad.

·         Ansal Properties and Infrastructure has signed an agreement with Abu Dhabi-based investment firm Noor Capital and its advisor, India Realty, for setting up two township projects in Uttar Pradesh, in Agra and Ghaziabad. Ansal Housing is to develop a 100-acre township in Rewari, Haryana.

·         Private equity investor GE Capital signed a deal worth Rs 250 crore with Paranjape Schemes for developing an integrated township project in Pune.

·         Fire Capital Fund Mauritius, a global venture capital fund, plans to invest up to $250 million to develop integrated townships in 10 cities. The fund made its first investment in the Indore-based M Jhaveri Group in the 137-acre upcoming township Silver Springs being developed by it.

·         DLF is making a foray into Kolkata and is planning expansion into cities like Pune, Bangalore, Chennai and Hyderabad. The company recently launched a Rs 600 crore, 26.3 acre integrated township project in Hyderabad. DLF has entered into an agreement with the Kolkata Metropolitan Development Authority (KMDA) to build a new township in Dankuni, Hooghly district, West Bengal with an investment of Rs 33,000 crore. This would make the Dankuni township the largest public-private-partnership (PPP) project in the country.

·         Parsvnath Developers has announced the Parsvnath City in Dharuhera, Haryana, spread over 114 acres. The township will be close to National Highway-8 and strategically situated just 25 km from Gurgaon border.

·         Larsen & Toubro and Arun Excello will do a township in Maraimalai Nagar, Chennai. The project, Estancia, will be set up on 78 acres at a cost of Rs 1,500 crore.

Bangalore – Upcoming example of upcoming charter cities

Take the example of Bangalore city in India. With a view to de-congest Bangalore Metropolitan Area (BBMP, Bruhat Bengaluru Mahanagara Palike & BDA, Bangalore Development Authority Area) and direct further growth into the BMR Region by way of comprehensive development of new human settlements in an integrated manner, BMRDA (Bangalore Metropolitan Regional Development Authority) proposes to develop five New Integrated Townships with modern amenities and facilities at

1.     Bidadi, 

2.     Ramanagaram,

3.     Sathanur,

4.     Solur and

5.     Nandagudi.

The project is aimed at creating self-contained new integrated townships with work-live-play concept by integrating select economic activities in manufacturing/service/business categories. They are expected to offer the same or more comforts / facilities as available in Bangalore City minus the congestion, traffic bottlenecks in a serene and environmentally rejuvenating atmosphere. Series of road net work connecting these Townships with Bangalore City and Devanahalli International Airport is proposed by BMRDA.

Why Charter Cities

Though growth is necessary for development, not all growth benefits the poor. Charter cities concept by Paul Romer includes exploring strategies to ensure that economic growth is “pro-poor” and that donor organizations and government agencies encourage broad-based, pro-poor growth.


What charter cities can offer? OR Advantages of having charter cities?

Since every charter city has a specific purpose, it will help every areas, based on its competitive strengths to develop its niche segments.

Developing charter cities will be of great use for the society because of the following reasons:

1.      Inclusive Growth of all the areas and it will minimize the gap between urban and rural

2.      Pollution control: It will help developing different areas rather than a highly dense populated area without much sanitation.

3.      Easy management for the government bodies: Since charter cities will help in distributing the population uniformly the population hence it will help the government bodies in easy management.

Concept of Charter Cities - as per Paul Romer

Paul Romer, the renowned growth economist, believes that the world can create dozens, perhaps hundreds, of new high-density "charter cities" to encourage faster growth that is greener too. Each charter city could be a place where millions of poor families could become residents, live, and work under better rules and lift themselves out of poverty. Inspired in part by Hong Kong and China's special economic zones, such cities would give millions of desperately poor people their first formal-sector jobs, in many cases starting out in labor-intensive manufacturing (e.g. assembling garments or electronic devices) and services (e.g. call centers, outsourced business processing, or software quality assurance.)

  

Note that "charter cities" to a large extent can be read as "Special Economic Zone" in India and China context.