Over $150 bn needed in investments for smart cities, says study

The Modi government’s vision of creating 100 smart cities will require an investment of over USD 150 billion over the next few years with private sector being a significant contributor, says a report by Deloitte, adding that nearly USD 120 billion will come from the private sector.

The government has already initiated two programmes with an initial outlay of USD 7.513 billion for its ‘Smart Cities Mission’ and the ‘Atal Mission for Rejuvenation of Urban Transformation (AMRUT)’ to upgrade 500 existing cities.

PN Sudarshan, senior director, Deloitte India, said, “Even as funding for these smart cities is an area of concern, the major challenges remain with respect to the development of smart cities project management, government decision making and policy and regulatory framework.”

The government recently announced the list of first 20 cities to be developed as ‘smart cities’ with Bhubaneswar topping the list followed by Pune, Jaipur, Surat, Kochi, Ahmedabad, Jabalpur, Vishakapatnam, Sholapur, Davangere, Indore, New Delhi, Coimbatore, Kakinada, Belagavi, Udaipur, Guwahati, Chennai, Ludhiana and Bhopal.

While several cities have made incremental investments in smart solutions, the challenge will be to replicate these on a larger scale, he said.

According to the study, in 2016, service providers and over-the-top content providers will invest heavily in city-wide WiFi networks which will be the backbone for smart city services.

Sudarshan said, “As smart solutions are heavily dependent on ICT, service providers will play a significant role in smart cities. In 2016, service providers will participate in (and lead in many cases) consortiums for responding to RFPs for smart/ digital solutions for various city and state governments.”

Reliance Jio is likely to roll out WiFi services across over 50 cities in 2016. Similarly, Bharti and Vodafone are deploying WiFi through a joint venture company, Firefly. Facebook is working with BSNL to deploy WiFi in 100 areas in rural India, while Google has announced a partnership with the Railways to provide hotspots in 400 railway stations by 2016.

“Over the next 10-15 years, these cities will emerge as key technology, economic, and social hubs for the country. We believe that service providers that expect to be serious players in smart cities will take a centre-forward position in leading consortiums in the development of smart cities,” he added. —PTI

The study says service providers and over-the-top content providers will invest heavily