ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Sanjoy ChakravortySubscribe to Sanjoy Chakravorty

A New Price Regime

Land prices in urban and rural India have increased rapidly in the last decade - fivefold in urban areas and possibly more in some rural settings. Using comparable international data, this paper shows that urban prices are significantly higher than is commensurate with income and that the peaks of these prices are extraordinarily high. Similarly, rural prices in several regions are very high by international standards. It argues that the present conditions can be explained by a combination of increasing land scarcity with increasing money supply - from expanded housing credit, and rising incomes from white, black, and foreign sources - and increasing income and wealth inequality. All of which means this is no mere bubble.

A Lot of Scepticism and Some Hope

After recognising the main reasons to be hopeful about the new Land Acquisition Bill, this commentary critiques two significant structural problems in the proposed legislation: first, the definition of "public purpose", especially the "informed consent" provision that has been included; second, the price setting mechanism, especially the possibility of an exponential escalation at the metropolitan edges and the creation of certain bizarre rural-urban boundaries. The article concludes by raising a basic question: If the State has been the problem in land acquisition, why is more of it the solution?

Too Little, in the Wrong Places-Mega City Programme and Efficiency and Equity in Indian Urbanisation

Mega City Programme and Efficiency and Equity in Indian Urbanisation Sanjoy Chakravorty The first major urban policy initiative announced after the government of India began the economic liberalisation process was the Mega City programme, directed by the ministry of urban affairs and employment. It is an attempt to shore up infrastructure in five of the six largest metropolitan regions in India (Bombay, Calcutta, Madras, Hyderabad and Bangalore), using innovative financing mechanisms, and emphasising cost recovery. After detailing the political- economic background, the programme and its implementation, three critical questions are considered: one, is the amount of money being invested too little, and has it come too late to turn the situation around? Two, is the programme being targeted to the wrong cities? And, three, will the elite continue to remain beneficiaries, and the urban poor neglected? The answers to these questions raise doubts about the Mega City programme. Since the reforms will have to succeed in the cities (if they are to be durable), urban development policies must be considered with a view to sustaining efficient and, specially, equitable urbanisation patterns.
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