In May, the Ministry of Housing and Urban Affairs convened a two-day brainstorming session to review the status of urban planning and governance across India. Recognising that urban development is primarily a state responsibility, it becomes essential to study state-specific issues for nuanced policy deliberations. Thus, we turn our attention to Punjab, which is currently ranked as the 5th urbanised state in India after Tamil Nadu, Maharashtra, Gujarat, and Karnataka. Researchers state that the scale and pace of urbanisation in the state, however, has fallen prey to its lack of industrialisation efforts. This is evident in the Smart City Mission which selected only three cities from Punjab, namely — Ludhiana, Amritsar, and Jalandhar; and further the Ease of Living Index positioning them at 35th, 76th, and 77th rank respectively. The message is clear, Punjab is indeed mired in an urban policy gridlock.
Though urbanisation in Punjab witnessed an upward trajectory ever since the Green Revolution, the compound annual growth rate (CAGR) dwindled in decades following 1971. At present, it stands at 37.5% (Census 2011), and is projected to grow to 46.6% by 2036. Urban Punjab is expected to expand to 1.57 crore in demographic size by 2036 from 1.2 crores in 2021. However, a vast majority of this growth is concentrated in just three cities- Ludhiana, Jalandhar, and Amritsar, as only 34% of the state’s urban population lives in small and mid-sized towns.
‘What’ needs to be fixed
A glance at the three essential urban service pillars – Physical, Economic, and Institutional – embedded in the three Smart City Mission indicators – Housing & Inclusiveness, Employment, and Municipal finances (Governance) reveal domains that can be tapped for better urban planning in the state.
Firstly, issues crop up with both quantitative and qualitative shortages in housing, particularly affecting 99% of the Low Income Group (LIG) and Economically Weaker Sections (EWS). This mirrors the national scenario, where India faces a housing shortage of 26 million units despite the entitlement of the Housing for All mission. Cities like Amritsar, Ludhiana, and Jalandhar exemplify this crisis, with many housing structures in these cities being pre-partition constructions that are now dilapidated. Planning agencies in Amritsar, for instance, have collectively supplied less than 5% of the developed land needed for these segments. As a result, about 30-40% of the population of Ludhiana, Amritsar, and Jalandhar are living in slum conditions.
Secondly, the employment scenario in Punjab’s urban areas is complex. The Labour Force Participation Rate (LFPR) and Worker-Population Ratio (WPR) are cumulatively low, with urban unemployment rates fluctuating between 9.0% and 7.7%, compared to all-India average of 6%. While Amritsar, Jalandhar, and Ludhiana have high employment potential, the quality and quantum of employment in these districts vary significantly. Even the Pradhan Mantri Kaushal Vikas Yojana (PMKVY) has failed to address the employment challenges effectively. In response to a Lok Sabha question from MP Ravneet Singh Bittu the government revealed a troubling statistic: over the five year period (2018-2023), only 21% of individuals trained under PMKVY secured employment in Punjab. The figure is particularly disheartening, since a significant portion of these individuals underwent re-skilling.
Lastly, on account of municipal finances, the case of short release of Rs 866.13 crore on account of Grants-in-aid by the State Government to Punjab Municipal Fund during 2017-2020 has crippled the spending ability of these grassroot institutions. Per a CAG Audit report in 2021, a shortfall of 99% was also noted in terms of the finances that was sanctioned by the State Finance Commission compared to what was released. This shortfall has deprived the municipalities of the required funds to keep up the basic institutional facilities at the local level
‘How’ to fix it
In Punjab, a shift from physical distribution to integrated urban planning is imperative. Modernising agricultural practices will release labour resources and drive urban migration. The current housing security system is not equipped to support urban migrants due to unsustainable development practices. Hence, a phased housing security system that includes new migrants with stable employment, alongside a rental subsidy-based approach, is essential to meet urban housing demands.
Each city in Punjab should initially develop a strategic functional plan aligned with its resource capacities. The Comptroller and Auditor General’s (CAG) 2021 report highlights the limited involvement of Urban Local Bodies (ULBs) in executing projects under the Smart City Mission, primarily managed by three Special Purpose Vehicles (SPVs) in Amritsar, Jalandhar , and Ludhiana. Therefore, a critical need is felt for robust inter-municipal planning mechanisms to integrate functional plans and empower the governance pyramid.
Punjab’s growth narrative will be incomplete without empowering its Class VI towns (populations under 5,000), which have recently emerged as hubs of population growth. The state’s urban story shall witness a new sunrise if adequate administrative structures are provided to these new centres of growth.