The jury is still out on whether large public infrastructure projects benefit the last man in society. But if this city’s experience in areas such as Devanahalli, Marathahalli and Electronics City is anything to go by, the real estate sector as well as individual land owners have benefited by thousands of crores of rupees as a result of the development these areas have witnessed.
So, would it be wrong to impose an additional levy on such beneficiaries?
The City of London has already imposed a development levy on those who will be directly benefited by the ongoing Crossrail project that when completed will connect Berkshire and Buckinghamshire — 118 km apart — via greater London.
Speaking on this targeted and ad hoc levy system during his visit to the city, Sir Edward Lister, Deputy Mayor of London, said the Crossrail project has pushed up the value of properties along the length of the underground rail line. It was therefore logical and just to impose an added levy on these beneficiaries.
The levy varies from £20 to £50 per square metre.
What this additional toll, called Community Infrastructure Levy (CIL), did was raise millions of pounds to finance the Crossrail project and raised hopes that the new levy would make good the entire £300 million shortfall in funds.
Could it work in Bangalore? Swati Ramanathan of Janaagraha, Kiran Mazumdar-Shaw of Biocon and M. Sivasailam, managing director, Bangalore Metro Rail Corporation Ltd., were impressed by the idea.
The three were part of a panel discussion on ‘Governance of City Systems’, organised jointly by the British High Commission and Janaagraha here Friday.
Sir Edward said the CIL model is now being considered for every development project that has been planned to build London’s capacity as its population grows exponentially each year.
Sir Edward, who delivered the keynote address for the evening, also strongly advocated the view that governments should focus a bulk of their energies and resources toward urban development.
Quoting from a McKinsey report — which estimated that there will be 136 new cities in the East and 13 new cities in India by 2025 — Sir Edward said the world is rapidly urbanising and governments should invest a majority of their resources on cities.
He said since a bulk of the U.K.’s revenues is generated by the city of London, it should also attract the bulk of the country’s public spending.
“What is good for London is good for the nation,” Sir Edward said — a view that was applauded later by Ms. Shaw and Ms. Ramanathan, who advocated a similar approach for Bangalore.