What Do Our Cities Need to Become Inclusive Smart Cities?

Fifty-three percent of the population in India will be living in urban areas by 2050 (UN 2018). Three Indian cities—Mumbai, Kolkata, and Delhi—feature in the top 20 megacities in the world (Allianz 2015). The Smart Cities Mission (SCM) launched by the Government of India in 2015 aims to draw a strategy for Indian cities to retrofit, redevelop, and achieve city extension, thereby creating efficiency in the city administrative regime. Accordingly, SCM emphasises that smart cities are those “that provide core infrastructure and give a decent quality of life to [their] citizens, a clean and sustainable environment and application of ‘smart’ solutions.” (GoI 2017) 

Smart cities adopt information and communication technologies (ICTs) to reduce the burden on municipal or city-level administrative regimes and to upgrade the city infrastructure. As ICTs become integral to local governance, they will help in reducing the distance between the policymaking, its implementation, and the citizens. Further, they will help improve the quality of life, create employment, and enhance the income of various social groups, leading to create inclusive cities. At the city level, a special purpose vehicle (SPV) is created as a limited company under the Companies Act, 2013. This SPV plans, appraises, approves and releases funds to further implement, manage, operate, monitor and evaluate the smart city developmental projects in the concerned city.  

However, smart cities have posed more questions than answers. The most vital among these is how smart city planning can be made inclusive and how citizen participation can be enhanced. In the Indian context, it is necessary to answer this question because, on the one hand, the SCM talks about promoting the active participation of communities, but on the other, there has been heightened corporate involvement in the smart city-building process. The marketing director of Intel South Asia has said that Intel’s vision would help address local employment, problems of waste disposal, and create a cultural heritage for cities (Economic Times 2014). Datta (2015) talks about how corporate firms like McKinsey, KPMG, Accenture, and others project India’s growth prospects under the smart city regime. Dholera, the first smart city, has paved the way to create a model of entrepreneurial urbanism where a weak commitment is offered to enhance social justice. For example, since its inception, the master plan for Dholera was managed by United Kingdom-based global consulting firm, Halcrow, whereas Cisco undertook a majority of the work to build cables and create and manage a control room. In the case of Amaravati smart city, the master plan has been prepared by Surbana International Consultants, an urban consultancy firm based in Singapore (Ramachandraiah 2015). Further evidence is offered by Sadoway and Shekhar (2014), that Cisco is managing two smart cities in Gujarat and Maharashtra. 

Explorative field research in Hyderabad was undertaken by the author to understand the approaches adopted by a city administration to build an inclusive smart city. The following sections detail the findings of this study. The article also offers policy suggestions for prospective smart cities in India to build a strong institutional environment.  

The History and Background of Smart Cities

A basic study of literature on smart cities reveals that International Business Machine (IBM) is the pioneer of the smart city concept (Paroutis et al 2014). The United States Patent and Trademark Office confirms that the patent for the concept of “smart city” was registered by IBM in 2011 (Söderström et al 2014). It was amidst the financial recession that IBM orchestrated the smart city concept as a strategic move to benefit from the changing urban landscape. The company has proposed and organised several workshops and competitions inviting cities to compete for IBM’s strategic involvement in transforming their cities as smart cities. IBM as part of its smart planet challenge invited cities across the globe to compete for limited expertise, grants and consulting that it would offer. Although the competition was meant to last for three consecutive years, it continues to take place every year, on a rolling basis, given the surge in interest among the cities (Paroutis et al 2014).  

Among Indian cities, Delhi (2011), Pune (2012), Ahmedabad (2012), Chennai (2013), Allahabad (2015), Surat (2015), and Vizag (2016) have all competed in and won the IBM challenge (Economic Times 2015). In total, 800 cities globally have so far competed in the contest, of which 134 cities received consultation and grants. IBM is currently involved in about 2,000 smart city projects worldwide, generating about $3 billion in revenue, equal to almost 25% of its operations (Hollands 2015). After seeing the IBM’s competitive advantage in the field, other players such as Cisco, Siemens AG, General Electricals, Intel, HP, Google, Microsoft, Capita, Serco, Philips, Oracle, SAP,  and Accenture started to take an active interest in smart city building projects across the globe (Kummitha 2018). 

The SCM emphasises that smart people need to actively participate in governance and reforms, but so far, it is the elite, corporate giants and official development assistance (ODA) donor countries that have envisaged and planned smart cities across the globe (Datta 2015). For example, France offers its expertise to Nagpur, Puducherry and Nagaland, Japan assists Agra and Varanasi, Dubai is negotiating with the Madhya Pradesh and Andhra Pradesh governments (Harris 2015; UKTI 2015).  Further, UKTI (2015) highlights that Singapore also facilitated visits of Indian officials to visit Singapore to acquire skills to urban management and governance. 

The prominent role global firms play at the helm of smart city building has sidelined the potential role local knowledge could play. Local knowledge here refers to the skills and competence of citizens who live in a particular city. In the current scenario, most technology-based solutions are “force fitted” by technology firms by negotiating with implementing authorities. This form of city development enhances a technocratic model of governance where corporate interests are upheld at the cost of citizens' right to their city. Datta (2015) argues that Dholera smart city in India relies mostly on the technocratic mode of governance, which is shaped by corporate interests, thereby producing “new urban colonialism.” In fact, the technocratic mode of governance for smart cities is not restricted to India alone. Vanolo (2014) says that in Italian smart cities, the smart vision is forcefully introduced into city-level planning by corporate players. There is similarity across the regional and national contexts where, as argued by Paroutis et al (2014), corporate firms draw a marketing strategy to localise their vision by ignoring the local knowledge.

However, such strategies impose two limitations on smart cities. First, technologies are said to be more effective when they are built locally. The greater the distance between planning and execution, the greater the likelihood that such planning will have little impact locally (Orlikowski 1992). Corporate firms generalise their technological products across the cities, thereby ignoring the local realities (Batty et al 2012). Second, the top-down technology push in smart cities suppresses innovations and technological frames that could emerge from the grass roots. 

Given these limitations, Schuurman et al (2012) and Kummitha and Crutzen (2019) have emphasised the need to promote smart cities using the quadruple-helix model where public, government, industry and universities come together and build necessary technologies.  

The Case of Hyderabad

I conducted my field research in Hyderabad, designated by the Telangana government as a prospective smart city, to understand the local reality in Indian smart cities.^[1] In addition to the central government-initiated SCM, state governments have also started to promote their own cities (which are not part of the SCM) as smart cities. For example, Hyderabad is not one of the 100 smart cities designed by the SCM, but the government of Telangana and the Greater Hyderabad Municipal Corporation have raised resources to promote Hyderabad as a smart city (Das 2018). Moreover, the Telangana government has already taken the first step by establishing Telangana Hub (T-Hub), the biggest incubator in the country. 

I conducted interviews with various players in the quadruple-helix model—government representatives, universities, local entrepreneurs, and industry representatives—to understand whether the city is positioned to promote locally enabled technologies and innovation. The quadruple-helix model allows us to combine knowledge and competence from all the four key players in a city context. 

“[In] a quadruple helix model ... government, industry, academia and civil participants work together to co-create the future and drive structural changes far beyond the scope of what any one organisation or person could do alone. This model encompasses also user-oriented innovation models to take full advantage of ideas’ cross-fertilisation leading to experimentation and prototyping in real world setting.” (European Commission 2018)

The field research was carried out in Hyderabad from January 2016 to April 2016. A total of 33 interviews were conducted with citizens interested in creating bottom-up interventions, incubators that host such interventions initiated by citizens, venture capitalists, corporate firms that have access to some of the smart city interventions, and government officials who oversee the smart city interventions. I attended The Indus Entrepreneurs (TiE) Global Summit, an entrepreneurship forum organised in Mumbai in February 2016, and collected contact details of several venture capitalists, incubators and citizen-led startups. I shortlisted individuals and conducted 30 interviews from this pool. I also contacted government officials and interviewed three smart city representatives at the city level.^[2] To strengthen the field data, I relied on central government documents focusing on the SCM, records related to the SCM from the Hyderabad civic administration and the state government, and newspaper items on the subject.

Some Findings

The Telangana state government has strategically embedded the Make in India scheme in its aim to make Hyderabad a smart city. Jayesh Ranjan, Principal Secretary of the Information Technology (IT) Department of the Telangana government, said, “We initially started to promote Make in India scheme which was inaugurated in 2014, then this whole thing about smart cities came up, so we had to somehow connect these two things and promote citizen-led interventions in our smart city projects.”^[3] 

The Telangana Academy for Skill Development (TASK) and the T-Hub that are established to enhance human capital in the region and create new ventures respectively, work with the IT department in order to encourage citizen-led interventions. While TASK enhances the skill sets of the youth, the T-Hub provides access to individuals with innovative ideas to start their ventures by offering desk space, mentoring, and help in accessing resources. Due to this supportive environment, the youth in the city seem to be showing interest in initiating small-scale interventions. Vineeth, whose venture focusses on drones, said, “The Prime Minister is talking about startups, the state government is offering enormous resources. I think, there has never been a better time to start a venture.”^[4] Suresh Challa, an investor, said “when I was a student, one of my friends had to quit from a venture he co-founded with another friend as his family was unsupportive to the idea of entrepreneurship. If you see now, families are encouraging their children because they have realised that entrepreneurship is not a risky phenomenon any more, given the support system. I would say there is a paradigm shift.”^[5] 

Further, the state government also encourages startups to be their suppliers in smart city projects. Jayesh Ranjan also mentioned, “When we are so proactive in encouraging startups, then we cannot deny them a chance to participate in smart city projects, because a lot of new opportunities, especially technology driven, are coming up in the smart city space. It would be very contradictory. On the one hand, we claim ourselves as the startup capital of the country and on the other, deny startups a chance to participate. This is a question of our credibility.” He went on to speak about M-Wallet, a mobile app developed by a startup, that stores all driving-related documents like driving licence, vehicle registration papers, and pollution check. The police and traffic departments accept the documents available in the M-Wallet app as against the original documents generally needed.^[6] 

Apart from the government, academic institutions in the city are also promoting entrepreneurship. Sateesh Kumar, who initiated an organic food venture, claims “As part of my course work, I had a module called Tray Tower, where we nurture our business ideas and pitch them to investors.”^[7] In another institution, there is a similar experiment called “sandbox,” where students are encouraged to explore new ideas. Although elite educational institutions, less than half a dozen in number, offer entrepreneurship training for their students, the bigger picture is depressing when it comes to public institutions and engineering colleges. Rahul Jacob, the founder of RideIT, a corporate carpooling service, said, “My college where I passed out was basically a factory to produce IT employees. Although I was able to start my venture out of the experience I gained while working with Infosys, during my studies, I had zero exposure.”^[8]

Sujiv Nair, the chief executive officer of TASK, recounts that “about 92% of the total graduates in the region are unemployable.”^[9] Rohit Venkata, whose technology startup is being incubated at BITS Hyderabad claims, “We have travelled to almost all colleges in the region to recruit for our startup. We estimate that there are about 5,000 graduates in the concerned field from this region. However, we hardly found eight ‘talented’ candidates.” As a result, startups in the region are unable to find sufficient talent and are moving to other cities where better human capital is available.^[10]

The other key player in the ecosystem, industry, plays a mediocre role. There are two major roles that the industry is expected to play in promoting entrepreneurship, investing, and mentoring. When it comes to the latter, the city struggles with a scarcity of mentors. Raj Janagam, who heads UnLtd Hyderabad,^[11] told us, “The same speaker talks about idea generation, human resource, funding, managing teams, strategy, sales and so on everywhere.” The limited mentoring space is further deterred by their greed. He further says that “most of them hardly spend five minutes to mentor and expect five percent equity.”^[12] When it comes to investors, they hardly show any interest in investing in innovations because they aim to earn quick returns. At times, the promised investments do not materialise. For example, during a pitching event organised by The Indus Entrepreneurs (TiE) Hyderabad, one of the technology ventures was promised 20 lakh in exchange for 8% equity by an investor, but by end of the day, the investor did not show up. When I interacted with the concerned budding entrepreneur, he said that such scenarios are common in the city. Thus, the industry part of the quadruple-helix model, which is supposed to play a key role, dilutes the interest of the citizens. Although professional investing firms handle the investment portfolio in a more mature way, their investments are largely limited to established or “proven” ventures. 

The last representative of the quadruple-helix model is the public. There seem to be two issues when it comes to public contribution. Jagarlamudi Suresh, the founder of a digital startup, said, “People are eager to know what we do and our processes, so that they can engage in similar interventions. In fact, they may be able to outperform us with their connections to powerful political and market players.” Rahul Jacob talks about the second aspect and says that “when passengers opt for carpooling, they keep on talking over the phone during the ride or sit on the backseat, giving an impression that the owner who drives the car is a driver and the one who takes the ride is the owner.”^[13] 

In a nutshell, our analysis revealed that although the government is eager to promote innovations that are locally embedded, the ecosystem at large dilutes the intentions of the SCM. I offer the following policy suggestions for enriching the participation of various stakeholders from the quadruple-helix model. 

Policy Implications 

Policymakers must make planning effective not only by creating public infrastructure to promote bottom-up interventions, but by taking up an active role in building an ecosystem. Especially, cities need to create avenues for close interaction among various players in the quadruple-helix model. 

Some of the steps to build inclusive smart cities may be the following:

1. Build enabling policies for citizen-led interventions;

2. Recombine different policies such as Make in India and the SCM to enhance citizen participation;

3. Create a regional hub which can encourage citizens to come up with innovative ideas and to develop them as ventures;

4. Build strong partnerships among players of the quadruple-helix model;

5. Strengthen academic institutions to enhance human capital resource in the region;

6. Apart from SPVs, create a separate entity to finance and monitor citizen-led interventions.  

Further, India can learn from some of the best smart cities across the globe, which have set their base right to create inclusive smart cities. For example, Aarhus smart city in Denmark has mobilised the private sector, organisations and educational institutions to identify major city-level challenges and work together (Snow 2016). In Louisville in the United States, Louis Lab acts as a public co-working space for business and communities to work together and solve problems. In Reykjavik, Iceland, citizens can debate and vote on ideas on the Better Reykjavik website to improve the city environment. The “Madam Mayor, I have an idea” initiative in Paris allows citizens to propose and vote for ideas, that could benefit from a monetary grant from the city council. In Canada, a pan-Canadian competition encourages Canadian communities to develop ideas and compete for grants. Thus, inclusive smart city building is an ecosystem driven initiative, where players in the quadruple-helix model need to take an active part.