Jawaharlal Nehru National Urban Renewal Mission (JNNURM)

Jawaharlal Nehru National Urban RenewalMission(JNNURM)is a colossal city- modernisation plan launched by the Government of India under the Ministry of Urban Development. It was officially launched in the year 2005 with an aim to brace the infrastructure, improve the quality of service and enhance the aesthetic features of the cities. It envisaged an investment of over 1,00,000 crore to address the deficiencies in the urban infrastructure and service delivery.

The aim of the mission as per the mission statement was “to encourage reforms and fast track planned development of identified cities focusing on the efficiency in urban infrastructure and service delivery mechanisms, community participation, and accountability of ULBs/ Parastatal agencies towards citizens”.

Background of the Mission

As of the 2001 census, approximately 285 million (28 per cent) people lived in urban areas which due to the introduction of a new economic policy of liberalization and globalization is expected to expand its share to about 40 per cent of the total population of the country by the year 2021. It was also estimated that by the year 2011, the contribution of urban areas to the country’s gross domestic product (GDP) would rise to about 65 per cent.

However, such high productivity depends upon the availability of infrastructure services. Infrastructure such as power, roads, water supply and mass transportation along with civic infrastructures, such as sanitation and solid waste management form the backbone of urban economic activities.

The development of urban infrastructure across the country is indispensable for economic development and growth. Such realization on the part of the government has forced it to deliberate and devise a new strategy to rejuvenate the urban infrastructure and improve the mechanism of urban governance. JNNURM is a major initiative of the government in this direction.

JNNURM is a unique project that specifically gives primacy to the development of Indian cities. It is a result of the concern of the government caused by the burgeoning urban population of the country, degrading civic amenities in the cities and the need to boost economic activities in the urban places.

Therefore, to meet the new challenges that emerged in the urban space the government came up with the first-of-its-kind investment programme in the history of India that contains a framework for urban sector reforms, means of strengthening of urban bodies, fast-track development of cities and upgradation of infrastructure.

The mission is different from the earlier programmes as it focuses on inclusive development, development alongside the necessary reforms and represents the collective efforts of all the stakeholders in the urban sector.

Objectives of the JNNURM Mission

The following are the objectives of the JNNURM:

1. Integrated development of infrastructure services in cities.
2. Establishment of linkages between asset creation and asset- management through a number of reforms to ensure long-term project sustainability.
3. To provide adequate funds to meet the deficiencies in urban infrastructural services.
4. Planned development of selected cities including peri-urban areas, outgrowths and urban corridors to promote dispersed urbanisation
5. To widen and maximize the delivery of civic amenities and provision of utilities with emphasis on universal access to the urban poor.
6. Decongestion of the old city areas will get special focus in the programme.
7. Extension of basic services to the urban poor including improved housing, water supply and sanitation, and ensuring delivery of other existing universal services of the government.

Scope of the JNNURM Mission

JNNURM incorporates two sub-missions into its programme:

(1) Sub-Mission for Urban Infrastructure and Governance: This was to be administered by the Ministry of Urban Development. The Sub-Mission focused on water supply, sanitation, sewerage, solid waste management, road network, urban transport and redevelopment of old city areas. It also focused on the relocation of industrial and commercial establishments to conforming areas.

(2) Sub-Mission for Basic Services to the Urban Poor: This was to be administered by the Ministry of Urban Employment and Poverty Alleviation with a focus on the integrated development of slums through various projects for providing shelter, basic services and civic amenities to the urban poor.

Finance and Implementation

To realise the goal and succeed in the endeavour of transforming the urban space into an engine of economic development it is imperative that there should be a firm strategy in place to carry out the mission in a systematic manner. Therefore, the implementation process passes through several stages as given below:

1. Stage I- The preparation of the City Development Plan (CDP) is the first step in the implementation. It indicates the policies, programmes strategies and financing plans.
2. Stage II– Identification of Projects: The CDP would help in the identification of the projects.
3. Stage III – Preparation of Detailed Project Reports. The DPR would be prepared by the Urban Local Bodies (ULBs) / parastatal agencies for undertaking projects in the identified spheres. The projects are planned in such a manner that optimises the life-cycle cost of projects.
4. Stage IV- Release of Funds: There should not be any glitch in the flow of funds towards this objective. Therefore, funds from the Central and State Governments were channelized directly to the nodal agency designated by the State, as grants-in-aid. These designated State Level Nodal Agency (SLNA) disbursed the funds to the ULB/Parastatal agency for identified projects across cities.

The mission also supports Public Private Partnership (PPP) to tap private sector efficiencies in the development, management, implementation and financing of projects.

The following table gives the Financing pattern of the project

Category of Cities/Towns/UAs	Grant Centre	Grant State	ULB or Para- StatalShare/Loan from Financial Institutions
Cities/UAs with 4 million plus population as per 2001 census	35%	15%	50%
Cities/UAs with million plus but less than 4 million population as per 2001 census	50%	20%	30%
Cities/towns/UAs in North Eastern States and Jammu&Kashmir	90%	10%	–
Cities/UAs other than those mentioned above	80%	10%	10%
For setting up de-salination plants within 20 km from the seashore and other urban areas predominantly facing water scarcity due to brackish water and non-availability of surface sources.	80%	10%	10%

Duration of the Mission

The initial duration of the mission was seven years beginning from the year 2005. An evaluation of the experience of implementation of the mission was to be undertaken before the end of the Eleventh Five Year Plan in 2012. The mission was further extended for two more years, that is till March 2014.

Eligible Cities Under the JNNURM

The JNNURM gave assistance to the eligible cities/ Urban Agglomerations (UAs) across States in the country. The cities/ Urban Agglomerationswere selected based on the following criteria:

A	Cities/UAs with 4 million plus population as per 2001 census	07
B	Cities/UAs with 1 million plus but less than 4 million population as per 2001 census	28
C	Selected cities/UAs (state capitals and other cities/UAs of religious/historic and tourist importance)	30

The cities should have elected bodies in position.

There were 63 cities at the beginning which grew in number over time.

Agenda of Reforms

JNNURM endeavours to ensure improvement in urban governance and service delivery thus making   ULBs become financially strong and sustainable for undertaking new programmes. A number of mandatory and optional reforms were set up to be followed at the state and ULBs/Parastatal Agencies level.

All the reforms were required to be completed within the Mission period.

1. Mandatory Reforms at State Level:

1. Taking decentralisation measures along the lines of the 74th Constitutional Amendment Act. The State should encourage the association and engagement of ULBs in planning the function of parastatal agencies.
2. Repeal of Urban Land Ceiling and Regulation Act.
3. Reform of Rent Control Laws ensuring the interests of both landlords and tenants.
4. Reduction in Stamp Duty to not more than 5 per cent within the next seven years.
5. Enactment of the Public Disclosure Law that would help the preparation of the medium-term fiscal plans of ULBs and parastatal agencies and release of quarterly performance information to all stakeholders.
6. Enactment of the Community Participation Law to encourage and institutionalise citizen participation. The concept of Area Sabha is introduced in urban areas.
7. Associating elected ULBs with city planning function. Transfer of all special agencies that deliver civic services in urban areas to ULBs and also creating accountability platforms for all civic service providers in transition.

2. Mandatory Reforms at the Level of ULBs, and Parastatal Agencies

1. Shifting to the modern accrual-based double entry system of accounting in ULBs and parastatal agencies.
2. To introduce a new system of e-governance using IT applications(GIS and MIS) for the services provided by ULBs and parastatal agencies.
3. Reform of property tax with the help of GIS. Since property tax is a major source of revenue for ULBs it is important to support its effective implementation to ensure collection efficiency reaches the target of 85 per cent within the next seven years.
4. Levy of reasonable user charges by ULBs and Parastatal agencies so that the full cost of O&M is collected within the next seven years. Cities and towns in the North East and other special category States are given a little relaxation as they may recover only 50 per cent of O&M charges initially. However, these cities may graduate to full O&M cost recovery in a phased manner.
5. There should be internal earmarking of funds for basic services to the urban poor.
6. Provision of basic services to the urban poor. This should include security of tenure at affordable prices, improved housing, water supply and sanitation. Also, delivery of existing universal services for education, health and social security be ensured.

Mid-Term Appraisal of the Mission

A midterm appraisal was carried out by the consulting firm Grant Thorton which was chosen as an appraisal agency for Jawaharlal Nehru National Urban Renewal Mission (JNNURM).

The basic purpose of the study was to assess the degree and extent of the implementation of the mission and also to identify the constraints and suggest viable measures to make the programme a success.

The key Findings and Recommendation of the Final Report (2011) of the agency has been summarised below:

Findings

1. JNNURM emerged as a key tool in rejuvenating the urban space in the country. After Independence, JNNURM has the distinction of being the first national flagship programme of its kind and size for the urban sector.
2. This programme is slowly bringing about a change in the urban governance set-up and the mindset of the states and ULBs. It has successfully created awareness and raised expectations among the people for improved quality of life and a sustainable environment in urban areas.
3. The amount invested in UIDSSMT cities over a period of seven years is insufficient to bring about any appreciable change in the infrastructure to make them attractive destinations for industry and trade.
4. Funding of the mission cities was on the basis of population based on the 2001 census. Because of this, the smaller states with smaller towns were at disadvantage over the cities having higher populations.
5. Consultations with the stakeholders on the content of the draft CDP were missing in the majority of the cities which meant that the stakeholders were constrained to accept the plan without consultation.
6. The unavailability of the CDP report in vernacular language had its own limitation as even those who could access the report could not properly comprehend the proposals and hence were unable to provide any meaningful input on the draft CDP.
7. A majority of the DPRs were not backed by the Initial Environmental Studies (IES).
8. Most of the projects were sanctioned in the year 2007 because the preparatory work like primers, toolkits etc. were not prepared in time which consequently delayed the preparation of DPR.
9. There were coordination problems caused by having a large number of advisors and consultants.
10. Though all the states prepared the CDP and the DPR on the basis of which funds were released by the Government of India, only a few cities have initiated a revision of the CDP.
11. Some states did not even set up the Project Management Unit (PMU) or Project Implementation Unit (PIU).
12. Most of the states were unable to implement all 23 reforms (thirteen mandatory reforms at the state and ULBs level and ten optional reforms)
13. As no funds are earmarked for the implementation of the 23 reforms, many ULBs were facing acute shortages of funds in the implementation of several reforms, for example, the accounting reforms and GIS-based property taxation.
14. Most of the ULBs lack the requisite skills to carry out project preparation and therefore the states have engaged consultants for the said purpose.
15. The convergence for the sub-missions and their sub-schemes requires improvement.
16. There is an absence of provision for the constitution of the City Level Sanctioning and Monitoring Committee in JNNURM guidelines. Therefore, all the executing agencies are required to interact with the SLNA and the PMU on all matters involving the implementation of the project.

Recommendations

1. A Single mission directorate for both ministries is suggested.
2. JNNURM should be made an incentivised programme
3. The Mission should focus on the projects in terms of its identified key priority sectors like water supply, sewerage, solid waste management, drainage, roads and housing.
4. There is a need for the direct participation of the ULB staff in the entire process from CDP, and DPR preparation to project execution.
5. The approval process for projects should be divided into two stages: first, the in-principle approval stage and second the final approval stage in place of the current process of final approval of proposed projects in one go.
6. Data centres for the state should be created with immediate effect. There is also an urgent need for a map to be drawn of all the utility construction (both new and old) in the city. Funds should only be allocated to realistic compiled maps.
7. State Government should ensure the survey of the urban poor is done every ten years and funds be earmarked on the basis of the population of the urban poor and not on the basis of a fixed percentage for every city across the country.
8. The lower-level officials should be a part of capacity-building programs as they are responsible to implement them.
9. Monitoring mechanisms at the local level should be strengthened.
10. Physical progress for projects should be kept separate from reforms once commenced. In case of non-compliance with reforms within the stipulated time, only the last instalments i.e. 25% should be withheld. This would ensure that the physical progress of the work-in-progress projects is not stalled.
11. Property tax structure needs to be based on either the area-based method or capital value-based method and be shifted from the rental value method.
12. Smaller and medium towns require a substantial increase in funding for infrastructure to make them attractive destinations for investments.

With all its constraints and limitations the Mission is a bold step towards the rejuvenation of urban infrastructure, enhancement of financial sustainability of Urban Local Bodies, the introduction of sweeping reforms in urban governance and above all involvement of citizens in the urban planning process.

All the objectives might not have been a hundred per cent successful but it has set the tone for subsequent missions of the future in the urban sector. It has definitely brought about a change in the mindset of the States and the ULBs.

Glossary:

74^th Constitutional Amendment Act: It recognized urban local bodies (ULBs) as the third tier of urban government by assigning them specific civic functions. It requires state governments to amend their Municipal laws to empower ULBs with such powers and authority as may be necessary to enable them to function as institutions of self-governance

Parastatal Agency: A company or agency owned or controlled wholly or partly by the Government

Interesting Facts:

• JNNURM envisaged an investment of over 1 lakh crore Rupees.
• The basic objective of the Mission was to ensure the integrated development of urban infrastructure and services.

Did You Know?

• JNNURM was the first of its kind investment programme in the history of India.
• The initial duration of the mission was seven years ( 2005 to 2012). However, it was extended for two more years.

References:

1. Government of India: Jawaharlal Nehru National Urban Renewal Mission, 2005
2. http://jnnurm.nic.in/wp-content/uploads/2011/01/Prime-Ministers-Office.htm
3. Guidelines: JNNURM Guidelines, 2009
4. Final Report: Appraisal of Jawaharlal Nehru National Urban Renewal Mission, 2011, Grant Thornton India.
5. http://india.gov.in/official-website-jawaharlal-nehru-national-urban-renewal-mission