16611.pdf
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Reducing Urban Poverty
in India
The evolution of DFOD India’s
urban poverty reduction programme
CONTENTS
ABBREVIATIONS/ACRONYMS
3
1
INTRODUCTION
5
2
THE URBAN CHALLENGE
6
3
2.1
The Institutional Framework
2.2
Economic Development
2.3
Unequal Urban Growth
2.4
Environment and Services
2.5
Employment Opportunities
2,6
The Lived Reality of a Poor Urban Household
THE DEVELOPMENT RESPONSE
10
3 1 The Players
4
3.2
An Urban Framework
3.2.1
Slum Improvement
3.2.2
Urban Services
3.2.3
Urban Management
3.2.4
Urban Governance
3.2.5
Urban Development
3.2.6
Urbanisation
THE WAY FORWARD FOR DFID
4.1
Guiding Principles
4.2
What will DFID do?
4.3
Where will DFID work?
4.4
How will this work be done, and with whom?
BIBLIOGRAPHY
16
19
ABBREVIATIONS/ACRONYMS
A1ILSG
All India Institute of Local Self-Government
APUSP
Andhra Pradesh Urban Services Project
CAA
Constitutional Amendment Act
CDS
Community Development Society
Cl DA
Canadian International Development Agency
DFID
Department for International Development
DUD
Department for Urban Development
DUEPA
Department for Urban Employment and Poverty Alleviation
GTZ
Deutsche Gesellschaft Fuer Technische Zusamenarbeit GmbH
HSMI
Human Settlements Management Institute
IDT
Internationa! Development Target
IMF
International Monetary Fund
IUDD
Infrastructure and Urban Development Department
MUDPA
Ministry of Urban Development and Poverty Alleviation
NGO
Non Governmental Organisation
NIUA
National Institute of Urban Affairs
PPIAF
Public Private Infrastructure Advisory Facility
PPPUE
Public Private Partnership for Urban Enviornment
PRSP
Poverty Reduction Strategy Paper
SEW A
Self Employment Women Association
SIP
Slum Improvement Project
SJSRY
Swarna Jayanti Shahari Rojgar Yojana
SPARC
Society for the Promotion of Area Resource Centers
SUDA
State Urban Development Agency
TB
Tuberculosis
ULB
Urban Local Body
UNDP
United Nations Development Programme
1 INTRODUCTION
The scale of urban poverty in India is staggering.
organisations, the private sector and civil society,
because no one organisation alone can meet the
global challenge.
Current estimates suggest that in the order of 80
million poor people live in urban settlements.
These commitments mean that DFID India must
constituting around 30% of the total urban
population. These numbers are expected to rise. If
take a more strategic approach to its work. They
require a shift from managing discrete projects, and
highlight a need to work more closely with others
around common goals and objectives. Our existing
urban programme has already begun to focus on
policy reform at city and state levels. The Target
Strategy Papers, including the Urban Paper, provide
the broad framework for a more strategic approach
to urban poverty. Our new strategy therefore
reflects past lesson learning within projects, but also
examines the scale and magnitude of the urban
challenge facing India as a whole. It calls for broad
based engagement with a wide range of partners in
order to develop a coordinated international
response to the urban challenge, and outlines DFID
India’s particular role in this process.
the predictions are correct and the total urban
population of India over the next 25 years increases
from 27% of the total population to between 36%
and 50%, the number of urban poor could end up
in excess ol 200 million. This means that significant
reductions in poverty in India will only be achieved
if the urban dimension is included in all policy
planning and development.
The UK Government Department for International
Development (DFID) has been working in
partnership with the Indian Government on a
number of urban poverty reduction projects for
more than 15 years. It is the largest bilateral donor
in this field. During that period, DFID's programme
has evolved from slum up-grading projects in the
eighties and early nineties, to a city-wide poverty
reduction approach during the mid 1990s. More
recently. DFID has begun supporting a state wide
programme (with the Government of Andhra
Pradesh) to improve urban governance in 32 towns.
Tltis will include municipal management refonn and
direct support to civil society.
Until now. DFID has not worked to an urban
strategy in India. The programme evolved from
lessons learnt in the field, and discussions with the
Indian Government and other international
organisations about local priorities and needs. More
recently however, there has been a perceived need
to pull those diverse experiences together, and to
adopt a more strategic response to DFID’s
commitment in the UK Government's 1997 White
Paper to eliminate poverty world-wide. A series of
International Target Strategy Papers, covering
gender, rights, human and economic development,
the environment, and urban poverty, have
underlined that commitment, and provided
milestones against which progress towards the goal
of poverty elimination can be measured. These call
for engagement at global, regional, national and local
levels, and the development of partnerships with
national governments, other international
2 THE '.EC : ?' C .'.C
?E
Urban centres present tremendous opportunities lor
all people, including the poor. Cities are important
vehicles for social and economic transformation.
They are centres of employment. government and
politics; artistic, scientific, and technological inno
vation; and of culture and education. They create
the space where people can have diverse experiences,
where different cultures can mingle through a range
of human contacts, where a broad range ol economic
activities take place, and where services (including
health and education) can be provided on an effi
cient and cost- effective basis. Unfortunately, many
of die benefits of urban development are not shared
by the poor.
The increase in the numbers of the urban poor can
be partly explained by rural-urban migration of poor
people encouraged by economic opportunities in
urban centres. The increase can also however be
attributed to conditions within urban areas them
selves (unsanitary overcrowded living conditions.
and limited access to sendees, etc.), which keep many
poor people in their depressed state. Until and un
less cities are able to meet the needs of their expand
ing populations, any' advantages that economic op
portunities might present for the poor are likely' to
be outweighed by these factors. For policy makers
therefore, it means that the characteristics of urban
development must be understood and included in
initiatives to reduce poverty' overall in India.
2.1 The Institutional Framework
During the 1990s, India embarked 6n a process of
decentralisation, ratified for the urban sector in the
74th amendment to the constitution. The promised
devolution of power, resources and accountability,
which are essential tools to enable urban local bodies
to improve their responsiveness to locally identified
needs, has not however been fully' realised. There are
many' inconsistencies between the way in which
different states have decided to operationalise the
CAAs. while implementation has been impeded by
weak local capacities and conflicting political interests
among elected officials, bureaucrats, the private sector
and civil society'. It is not yet clear therefore that the
process of decentralisation in India will actually
empower poor people to influence policy and practice.
I Bailey 2000
2 NIUA 1998
6
Urban managers in India are frequently ineffective
because of outdated and inappropriate procedures,
with a lack of delegation of authority and resources,
and a lack of accountability for performance.
Managers have received little or no training in
modern management techniques. Management
infor-mation systems are generally' uncomputerised
and ineffective. Financial planning, if it exists at all,
typically takes place only on an annual basis and is
driven by political equity rather than targeting
identified priorities. Resources are inevitably
limited. Municipal authorities fail to identify
opportunities to mobilise additional capital from
the private sector, or to raise additional revenue
from their population for fear of being politically
unpopular. The outcome of poor management is
inadequate services, under-investment in
infrastructure, a lack of resources for maintenance,
and rigid adherence to rule books, which discourages
innovation and any attempt at responsiveness to
consumer demands.
Urban development also suffers from overlapping
authorities by different tiers of government at the
local level, and territorial fragmentation where an
urban settlement and its periphery are divided
between several jurisdictions. Alternatively, a
metropolitan city may be divided between many'
municipalities, making strategic urban management
difficult to achieve. Calcutta, for instance, is divided
between 107 local bodies. Although India has a long
history of developing master plans, these have not
been used to anticipate desirable development and
to execute it. Rather the reverse is the case. The
approach has been one of control, rather than the
promotion of development1.
2.2 Economic Development
The general consensus is that poverty' in India can
be most effectively reduced through economic
growth, for which rapid urban development is a key'
driver. The National Institute for Urban Affairs2
estimates that urban India currently' contributes
between 50-60% of the country's Gross Domestic
Product, whilst accommodating less than a third of
its population. Indeed, the manufacturing and
service sector economies, which are the most
dynamic parts of the Indian economy, are
predominantly urban. In addition, with agriculture
exempt from income tax, the fiscal base of the
economy is also disproportionately reliant on the
urban economy. As the proponion of people living
in urban areas continues to rise, the opportunities
for poor people to tap this growing economic base
are enormous.
Unfortunately. despite economic reform measures
taken in the early nineties. India's capacity to take
best advantage of these opportunities, and hence
ensure that economic growth contributes to poverty
reduction, has been limited. This has meant that.
apart from in a few show-piece cities, investment
has remained low and growth has not significantly
improved the economic status of the urban poor.
The policies and practices of the government, civil
society, and the private sector continue to
discriminate on the basis of class, gender, age,
ethnicity, disability, or other social factors. The
poorest, and especially low caste women and
children, suffer from the worst forms of
discrimination, deprivation and exploitation.
2.3 Unequal Urban Growth
The proportion of people living below the poverty
line in many states is now higher in urban areas
than in rural areas. Developed states, such as the
Punjab and Karnataka, and the less developed states
like Andhra Pradesh. Kerala. Madhya Pradesh, Uttar
Pradesh and Rajasthan, have reported higher levels
of urban poverty than rural poverty for a number
of years’. This suggests that economic development
even in relatively prosperous states has not been
translated into benefits for the urban poor. Kundu1
suggests that in "Karnataka. Maharastra, Tamil
Nadu and even Andhra Pradesh [this] could be due
to the nature of development itself which fails to
make a dent on the well-being of the poor.. ..Casualisation and marginalisation of the workforce could
be the factors behind high levels of poverty".
migration now only accounts for a third of urban
growth. One third is due to natural population
increases, and a third by the redrawing of urban
boundaries to accommodate new settlements.
Given the pattern of urban growth, it is not
surprising that there is a direct correlation between
the incidence of poverty and the size of town. In
the larger urban centres, poverty levels in 1993/4
were around 20% of the total population. In towns
of less than 50 000 people, the proportion of those
below the poverty line was 43%’. The smaller
towns, where economic growth is happening
incredibly fast, do not have the capacity to keep
pace with the demand for shelter, the provision of
basic infrastructure, such as water and electricity,
and other essential services, that these economic
migrants require.
2.4 Environment and Services
The economic and demographic growth of urban
areas is increasingly placing a strain on the urban
environment. Sustainable environmental planning is
at an early stage, and is not yet considered a priority.
As a result, increasing numbers of unauthorised
private borewells are dug at the cost of an ever
decreasing water table; waste is thrown into open
drains, which subsequently become blocked because
refuse collection services are disorganised and/or
underfunded; and poor air quality causes an increasing
number of respiratory health problems, prompted,
for example, by the inefficient use of energy for
cooking. It is the poor who suffer the consequences
of environmental degradation, resulting in ill-health,
disability and loss of earnings.
attributed to the fact that the process of urbanisation
Provision of adequate and affordable civic services
(e.g. water and sanitation, health care, education,
financial credit, legal protection, etc.) is thus an
integral part of sustainable urban development and
poverty reduction. As cities grow, however, the
pressure on existing services and associated
in India over the past decade has been patchy.
Although a third of the urban population live in
the large metropolitan cities, two thirds live in
thousands of small and medium sized towns, and it
is in these where rapid population growth has
occurred. It should however be pointed out that
although urban growth rates vaiy according to the
size of town, at a national level, rural-urban
infrastructure increases with a resultant increase in
the number of people without access to these
services. Inevitably it is the poor and the most
vulnerable who are excluded and who end up paying
higher prices for lower quality products via the
informal sector. Ironically it is the poor themselves
who provide many of the essential services which
keep cities functioning.
In part, these inter-state differences can also be
3 Kundu 2000b
4 Kundu 2000a
5 Dubey el al 2000
7
In India, the public sector has failed to provide
adequate infrastructure and social sen ices despite
the entrenched belief that ’ the government will
provide". In these circumstances, the involvement
of private, non government or community based
sen ice providers has increased some efficiency and
responsiveness to consumer choice. The record
however is patchy. It has been effective where
consumers can be charged and competition is
possible eg. for housing, public transport, health
and refuse collection, but success is often dependent
on sufficient regulation, financing, and public
provision to protect standards and equitable access.
This is rarely done.
and casual employment. Here access to jobs and
training is dominated by neighbourhood and caste,
while women are usually paid half the male wage
for the same employment'’. Wages are forced
downwards, working conditions are unprotected
and unregulated, and access to opportunities is
mediated by the capacity of individuals or
households to mobilise support from local
‘mustangs’ or 'dadaas' who control entry to different
markets. The informal sector is expanding. One of
the key challenges for the future will be to identify
mechanisms to support its development to the
advantage of employers and employees alike.
Government policy on urban poverty has aimed to
For poor people, the problem of service provision
is compounded by the fact that decision makers do
not necessarily know what their needs are, or indeed
recognise that they have civic rights. Illegal settlers
have no rights to public services at all, while the
needs of the most vulnerable - the destitute,
pavement dwellers, abandoned women and sex
workers, etc. - are often overlooked altogether.
2.5 Employment Opportunities
In urban areas, people's main asset is their capacity
to sell their labour. They have few other assets to
build on - their home may be rented or be unfit for
habitation; they may not own land or cattle in the
town; and the social networks built by households
over generations in die village may be less strong in a
dynamic urban context where people come and go.
The opportunities open to different urban
inhabitants vary considerably. The growth of a large
number of small and medium sized towns, attracting
surplus labour from rural areas, has not been
matched by a growth of productive employment,
because these towns lack the capital to invest in the
required infrastructure and amenities. In the older
industrial centres, such as Calcutta, the decline of
the industrial base has pushed many un-skilled and
semi-skilled workers into unemployment. The poor
are not necessarily equipped with the skills and
training to take adv antage of newer opportunities
in modern industry and the rising service sector.
The formal wage sector has been unable to absorb
the expanding labour force, and as a result, there
has been a massive growth of the informal sector
6 Harass, Kannan and Rogers 1990:107
7 World Bank 1998
8 NIUA 1998:239
8
enhance productive employment and income for the
poor through wage and self employment schemes.
Unfortunately, the economic criteria for identifying
the target groups under the programmes has been
open to abuse, and many benefits have been captured
by the non-poor . In addition, the budgetary
allocations are grossly inadequate, and demonstrate
that the government's emphasis is still on addressing
rural rather than urban poverty. Although the ratio
of urban to rural poor is 1:3-5, lhe ratio of funding
for poverty programmes is 1:35s.
2.6 The Lived Reality of a Poor Urban
Household
decline still further. On the positive side, the
daughter could get married quickly and leave
1 he cost <>t the taiiure of planners, policy makers,
home; the eldest son could gel a more secure job;
the mother and her younger children could enter
the labour market, and the family could draw on
bureaucrats. and civil society as a whole to address
the urban challenge is disproportionately borne by
the poor. Box 1 below highlights the condition of a
typical urban household in Cochin, at a particular
point in time.
Box 1 - A Poor Urban Household
"S is 37 and she has 11 children ... her husband,
H is a head-load worker., he is an asthmatic
patient because of the sulphur dioxide fumes he
inhales....he cannot go to work regularly, and in
the monsoon season work is even less likely.
Their son is a coolie but has only two or three
days work in a month...the eldest daughter is a
maid servant ... no wages but food and
clothing., they expect some support from her
employer when she gets married.... their house
is built of raw packing cases, only enough space
to accommodate five, no furniture, only cooking
utensils...Rs 40 is the average amount they have
for food per day...it is not enough and generally
they go to bed hungry...their diet is in the
morning boiled rice with chutney and at night
rice porridge., the children have skin diseases.
diarrhoea and TB.
(Cochin Corporation and DFID, 1996)
The household experiences multiple vulnerabilities
- ill-health, insecure and limited income sources,
gender biases at work, and unsanitary and precari
ous living conditions. They are probably located in
a squatter colony in an unauthorised slum. Their
vulnerability is compounded by a weak regulatory
environment (causing the inhalation of poisonous
sulphur dioxide fumes, and dependence on exploit
ative working conditions), as well as limited, or no
access to essential government services, which are
their right (TB eradication programmes, nutritional
social networks for financial support. Conversely,
the family could be evicted from their house; the
husband could die from asthma; the younger
children could become too sick to enter the labour
market, even as child labour; and the daughter
could be raped and become a sex worker living
on the streets''.
As research for DFID India has shown1", the basic
need of this household, and many others like it. is
for survival (ensuring that destitution is held at bay).
It is only then that they can prioritise longer-term
security (e.g. investing in training in the hope of
obtaining a more secure income stream), and
ultimately seek and value an improved quality of
life (through improved access to environmental
infrastructure, freedom from police harassment, etc).
The factors which will influence whether this
household maintains its present condition, improves
its status, or declines still further are partially
dependent on its own capacities. More importantly
however, this household's well being is dependent
on factors outside its control. It is dependent on
the capacity and willingness of national and local
government to protect and promote its rights; on a
strong civil society to demand that poor people’s
rights and needs are recognised and addressed; on
the willingness of the private sector to adhere to
employment and safety standards; and on a buoyant
economy to generate the resources though which
growth with equity can be achieved. These factors
are at the heart of the urban challenge for DFID
and its partners in India.
support, etc.).
The household could be defined as a coping
household. It appears to have balanced its
opportunities and constraints, and is just about
surviving. There are conditions within it however,
which could cause it to improve its status, or
9 Loughhead et al 2000
10 IAS 1999
9
Government policy on urban poverty takes a three
3.1 The Players
Most national governments have already recognised
the need to improve their response to the urban
challenge, and in particular to urban poverty, and
have participated in a series of UN global
conferences. Habitat I in Vancouver in 1976 focused
on human shelter and housing. Habitat 11 in Istanbul
in 1996 mapped out the urban agenda for the
twenty-first century It introduced the new themes
of Urbanisation and Sustainable Urban
Development in response to spiralling urban
degradation and decay, and outlined the Habitat
Agenda, which calls for global action to address these
challenges. Istanbul+5 was held in June 2001 to
review and appraise implementation of the Habitat
Agenda world-wide.
India is a signatory to the Habitat Agenda, and par
ticipated in Istanbul+5. The union ministry which
deals with urban issues is the Ministry of Urban
Development and Poverty Alleviation (MUDPA).
At present the MUDPA has two main departments,
namely the Department for Urban Development
(DUD) and the Department for Urban Employ
ment and Poverty Alleviation (DUEPA). The
former deals with urban policy, land, water sup
ply. sanitation, transport and local self government
and the latter with housing, employment and pov
erty alleviation. India does not have a national ur
ban policy, though a draft was prepared in 1992 by
the then Ministry of Urban Affairs.
State governments have primary responsibility for
planning and initiating programmes in the urban
sector, and have been requested to prepare state
based urban development strategies. These have not
as yet been produced. Under the 74'1' amendment
to the constitution, however, greater autonomy,
authority and accountability for the provision of
civic amenities has been devolved to Urban Local
Bodies (ULBs). Poverty alleviation is a specific ULB
responsibility. In addition, at state level, State Urban
Development Agencies (SUDAs) and District Urban
Development Agencies (DUDAs) exist, and are
responsible for ensuring coordination between
different urban develop-ment programmes.
pronged approach: a) enhancement of productive
employment and income for the poor; b)
improvement in general health and welfare services;
and cj improvement in infrastructure and the built
environment for poor neighbourhoods. The Swama
Jayanti Shahari Rojgar Yojana (SJSRY) is the union
ministry's main urban anti-poverty programme. It
integrates all of the above approaches and many
previous schemes, and relies on community
development societies and bottom up planning
processes as the vehicle for implementation. In
addition, a number of other Plan schemes, including
the National Slum Development Programme, the
Integrated Development of Small and Medium
Towns and Low Cost Sanitation for the Liberation
of Scavengers, etc., are aimed at urban poverty
reduction.
Several international organisations are working with
the Government of India and civil society to address
the urban challenge. These include die World Bank,
the Asian Development Bank, the European Union,
United Nations Development Programme, United
Stales Agency for International Development, GTZ,
AusAid, Italian Development Cooperation Office,
Netherlands Development Assistance and Canadian
CIDA. A number of inter-national NGOs including
Oxfam, ActionAid, and Care also have urban
programmes. Similarly there are thousands of local
NGOs spread across the country involved in urban
poverty initiatives, in particular organisations such
as SEWA and SPARC and their support to micro
credit and savings groups. The National Slum
Dwellers Federation is the largest representative
group of the urban poor in India.
During the late 1990s, many of the above
organisations have reviewed their approaches to the
urban sector, and have developed new strategies with
a clear emphasis on mechanisms to reduce urban
poverty.
3.2 An Urban Framework
A number of approaches towards promoting
sustainable urban development have been adopted
by governments and development agencies over the
past 20 years, based on their different understandings
of the urban challenge, and how to address it. Given
DFID s central interest in poverty reduction, and
10
its recognition that economically viable cities
contribute to this encl, this section therefore
examines the development response through an
urban poverty lens.
The basic elements of sustainable urban
development are represented in the framework
below. For each area of intervention, the impact
on poverty is described. In operational terms, the
framework demonstrates increasing levels of
complexity from the bottom to the top of the ladder.
At times, some parts of the ladder have been tackled
simultaneously, at others, policies and programmes
have focused on particular rungs. The major lesson
is that all players -towns and cities. States, the
National Government, donors, etc., - need to have
a strategic grasp of the full spectrum of interventions
if sustainable development, and poverty reduction
in particular, are to be achieved.
For DFID the ladder represents the natural
evolution of its support to the urban sector in India
over the past two decades. Starting with its housing
and slum improvement projects in the mid 80's it
has moved more recently towards urban governance
and urban development types of intervention. This
progression is represented by the project names in
the right hand column of the framework. In doing
so, it is important to note that the lower "rung"
interventions have remained an integral part of
project design. In other words, the development of
projects and programmes has been cumulative, based
on past lesson learning, rather than jumping from
one agenda to another as new issues emerge.
Table 1: The Urban Ladder
Intervention
Emphasis
Urbanisation
• Rural/urban links
• District/State level planning
Poverty Angle
DFID Projects
• Considers all poor
• Addresses poverty' at source
Urban
Development
• Investment
• Employment
• Economic growth
• Good labour markets
Urban
Governance
• Municipal reform
• Pro-poor policies
• Decentralisation
• Responsible & accountable
elected representatives
• From patronage to civic rights
Urban
Management
• City planning
• Municipal finance
• Poor “planned" into city
• Sustainability of services
• Formal/informal sector
partnerships
♦ Well regulated employment
opportunities
Calcutta 2
|
• Capacity building
Urban Services
• City systems
• Stakeholder participation
• Vulnerable groups
• Poor included in the city
• Stakeholder choice
• Non-slum poor included
Slum
Improvement
• Physical improvements
• Area specific
• Community initiatives
• Improved environmental
conditions within recognised
slums
• Improved “quality of life”
for the better off poor
• Skills upgrading
APUSP ~
Cochin,
Calcutta 1c
Cuttack
3.2.1 Slum Improvement
Slum improvement is the most traditional form of
urban intervention, and is focused essentially on the
provision of environmental services in registered
slums. It can also include community development
and health initiatives as integrated activities within
|
Hyderabad,
Vizag.
Vijaywada,
Calcutta la/b,
Indore
specific localities. During the late 80s and early 90s,
DFID was the largest single bilateral donor in the
urban sector in India, and spent £120 million on
slum improvement projects in Hyderabad, Indore,
Vijayawada, Visakapatnam, and Calcutta covering
an urban slum population of 5 million, or about 1
11
million households. This approach was consistent
with the Government of India's support to urban
poverty reduction during that lime.
The positive impact of Slum Improvement Projects
(Sil’s) has been better living conditions for slum
residents and more social integration of slums into
the city. Women in particular have benefited from
improved infrastructure, as the burden of collecting
water and maintaining household hygiene has been
reduced and their personal security has improved
through the provision of amenities such as street
lighting. In many cases, the provision of sound
infrastructure along with improvements in tenural
status have been a catalyst for investment in
housing. This approach has also demonstrated the
value of participator)' planning processes so that
poor people get what they want and need, and have
a commitment to ensuring that it is adequately
maintained. There have been some positive
experiences in promoting informal education
(balvvadis) programmes, vocational training, legal
literacy, gender awareness, financial services and
neighbourhood group strengthening.
The SIP approach however has a number of
limitations. One is cost Scaling up from 5 million
beneficiaries to all the urban poor in India would
cost up to ,£3 billion11. This compares to the plan
budget for urban areas in the 2000-01 budget of .£120
million. Whilst over time there is a case for the
reallocation of resources from rural poverty
programmes to urban poverty, fiscal resources are
highly constrained.
A related problem is the area specific nature of SIPs.
Not all slum dwellers live in recognised slums.
Others live in the most precarious sites and live in
untenable conditions - along canal banks, on
pavements, and along railway lines - in constant fear
of natural disasters (flooding, fire, accidents) as well
as eviction or re-location. They constitute a sizeable
number of the poor. Slater, using the 1991 census,
has estimated that at least 30 million people fall into
this category alone in India1213
. This is in addition to
the 46 million residing in recognised slums.
Furthermore, a significant number of the poor live
outside slums altogether - on pavements; in hostels,
brothels, jails; and in scattered dwellings alongside
richer houses. Their needs are not covered at all.
11 Burton 2000
12 Slater (1998)
13 Loughhead et al 2000
12
3.2.2 Urban Services
At a more systemic level, lessons from the early
SIP approach highlighted that poor people not only
needed a wider range of services than the SIPs had
on offer but that they should have a direct role in
determining the type of services best suited to their
needs. Also it was clear that in-slum sendees could
not be divorced from the wider context within
which they operated and therefore in-slum drains,
or garbage collection and disposal, for instance,
need to be connected to city-wide drainage and
solid waste management systems. Thirdly, in the
context of operation and maintenance, projects
were more sustainable if they were implemented
through the organisation responsible for the
continued provision of the sendee, as opposed to
setting up autonomous project management units.
Programmes from the early to mid-nineties have
therefore sought to build on these lessons, focusing
on more holistic approaches to service provision.
drawing on an improved understanding of what
poor people want and need through bottom up
planning approaches1', and strengthening the
capacity of Local Government and other service
providers to meet a range of needs. The latter
includes examining who is best placed to deliver a
service (public, private, voluntary sector),
developing effective public-private partnerships,
initiating financial management reforms, and
increasing local capacity to enforce a strong
regulatory environment, which will reduce
discrimination on the grounds of class, caste and
gender.
The ability of the poor to organise themselves to
identify and demand services from service providers
is an important part of this process. A buoyant civil
society supports the conditions within which
government servants and systems are held
accountable to their citizens. The time and effort
that this requires in advance of project
implementation cannot be underestimated. One
way to strengthen civil society in an urban context
is through the formation of neighbourhood groups,
federated as a Community Development Society at
the city level. In addition to engaging in self help
schemes such as micro-planning, thrift and credit,
or directly operating and maintaining infrastructure,
the CDS structure can provide an appropriate
mechanism tor receiving State and centrally
sponsored anti-poverty programmes such as SJSRY.
Partnerships with particular civil society groups can
also strengthen some aspects of service delivery. Rag
Pickers, tor instance, can be key players in solid
waste collection and recycling systems.
3.2.3 Urban Management
A managerial approach to urban poverty reduction
recognises that urban problems are intimately
connected to a systemic failure of management.
Urban bodies have to manage their resources -
physical, financial, and human - but they often kick
even the most basic information about the resources
that are currently available, or potentially at their
disposal, and about how these resources could best
be used. Proper procedures do not exist to plan and
allocate resources to priority tasks. Human
resources are typically hired without consideration
of the long-term sustainability of the financial
burden imposed. Without a proper inventory of
physical assets or estimates of the financial
requirements for operation and maintenance, there
is a tendency for available funds to be allocated on
an ad hoc basis for new investments rather than for
ongoing repairs. Also there are no systems of
performance measurement which diminishes a sense
of accountability.
Urban management problems cannot simply be
addressed at city level. They require an engagement
with the broader policy and institutional
environment which shapes city managers and city
management systems. The key to improving urban
management therefore is to put in place the right
framework at State and city level for long term
financial and physical planning, and to create the
right incentives and rewards for managerial
improvement. The DFID supported Andhra
Pradesh Urban Services for the Poor Project seeks
to provide additional resources to those who are
able to demonstrate that plans are in place which
address the real needs of poor people, and which
cater for operation and maintenance costs. Tools
such as a Revenue Improvement Action Plan can
provide a framework for planning the expansion of
resources and expenditures over the medium term
in a rational way. New instalments for mobilising
capital, such as bond issues and private sector loans,
create a strong incentive for urban managers and
their political masters, if supported by appropriate
planning procedures and capacity building support.
Improved urban management also means better
linkages between different funding sources,
including convergence between aims and objectives,
as well as targeting. Different anti-poverty schemes,
for instance, which originate from different
government departments, need to be converged at
local level, while support from mainstream
departments, such as health and education, needs
to be taken into account when planning local level
initiatives with locally raised funds. The experience
of the Cochin Urban Poverty Reduction Project
has shown that the establishment a poverty cell
within a municipal corporation provides an
opportunity to do this.
3.2.4 Urban Governance
Urban Governance provides the foundations upon
which an efficient and effective town or city
operates. The term embraces the idea that citizens
are represented in the political systems and
government is held accountable; that a framework
exists which allows civil society to operate and
interact with political society; that human rights,
including those of the most disadvantaged, are
respected and promoted; that basic sendees are
guaranteed, and that security and justice are
provided and accessible. It also means for
development practitioners that a drive for efficiency
includes pro-poor political processes. These will
enable the poor to organise and to influence decision
making, ensure the equitable, as well as efficient
delivery' and management of sendees, and guarantee
the personal security of all citizens within
households and communities alike.
Evidence suggests that decentralisation and
democratic local government cannot deliver all these
conditions at once, and that too many expectations
based on a progressive reform agenda should not be
placed on an already overburdened system". Some
limited gains may not lead directly to the ends
desired, but in these cases, it is for policy makers to
understand the constraints in the system, rather than
view the reform a failure per se. For instance.
improved democratic systems may increase
participation, but may not lead to empowerment
or poverty reduction because the poor are weakly
14 Batley 2000
13
organised. and accountability mechanisms tinder
deseloped. Furthennore. it is important to recognise
that there is no one right solution. As a starting
point, there should be clarity about the local
framework within which multiple actors operate,
and there should be clarity about the power.
functions, role and resources of different levels of
government, and indeed of other bodies. This should
include the private sector, and non-government and
not for profit organisations.
DFID India has already begun to calve out its role
in this complex agenda. It is maintaining its emphasis
on direct support to poor people through slum upgradation and city wide vulnerability programmes.
It is also seeking to strengthen the capacity of civil
society to participate in government decision
making, and to advocate for. and manage services
itself. The Andhra Pradesh Urban Services for the
Poor Project will take these broad governance
agendas several stages further. It is working in 32
medium sized towns in Andhra Pradesh to
strengthen civil society and improve the capacity
of city managers to manage systems and services
better.
An urban governance approach to the urban
challenge for poor people might include many, if
not all the elements in the following table It requires
engagement at different levels - the macro (states
and markets), the meso (local government and local
markets), and the micro (communities and
households). It involves a mixture of formal and
informal arrangements, and both direct service
provision as well as actions to empower people to
participate in political processes. It also requires
policy makers and planners to distinguish between
those actions which will help the poor to develop,
and those which will protect them against a reversal
of fortunes, namely development and social
protection. This schemata should influence the wav
in which policy is introduced as well as how it is
implemented.
Table 2: A Possible Policy Framework for Urban Poverty Reduction
I_____
Macro
(states and
markets and
fonnal arrange
ments.
Meso
(local govern
ments and local
markets fonnal and
informal
arrangements.
Micro
(communities
and householdsin fonnal
arrangements).
14
Development
Social Protection
v
• Education and skill training
• Regulate markets to ensure economic
development also benefits poor people
• Political representation in decision
making.
• Social insurance and pension schemes;
laws to outlaw discrimination.
• Laws to support labour standards, and
to protect employee rights to combine
in unions.
• Disability, housing and banking policies.
• Provision of services - health, basic
education, water, energy, sanitation, etc.
• City level planning, which takes account
of needs and interest of the poor.
• Improved convergence of programmes
for the poor, and increased allocation of
resources.
• Collaboration with range of agencies
(municipalites, NGOs, etc)
• Targetted pro-poor initiatives.
• Improved accountability systems.
• Ensuring the needy receive their entitle
ments to eg pensions, health care etc.
• Improvements in quantity and quality of
service provision and on-going
maintenance.
• Identification and implementation of
programmes to reduce risks.
• Participation in community groups
(social capital), informal labour
arrangements/protecting access to jobs
and markets); organisation of creches so
that women can work. etc.
• Kinship groupings; extended families.
marriages; thrift and credit groups;
tenancy arrangements between house
holds; leaders/representatives aware of
legal rights; informal support to those in
need (charity); % maintenance of basic
infrastructure.
I
3.2.5 Urban Development
1 he process of urban development involves an
improvement in the productive economy of urban
areas. 'I his is generally taken to mean the generation
of employment and more remunerative economic
livelihoods, through increased investment in
businesses and economic infrastructure which is
relevant to business (particularly transport, power,
telecommunications, and water). A broader
definition of urban development will also include
investments in social and environmental services,
including infrastructure which critically affects
urban residents' quality of life. There is a clear
recognition that improved infrastructure is a
prerequisite for increased economic growth in India.
With the projected increase in the urban population
over the next 15 years, poverty can only be reduced
quickly with rapid urban development.
The Urban Development agenda is closely linked
to other elements in the urban ‘'ladder”.
Improvements in slums, urban services, urban
management, and urban governance will all lead to
a better urban environment which is conducive for
economic development. It should be recognised that
the critical actor in generating economic growth is
the private sector, and the role of government is
principally one of facilitator to ensure that the needs
of the poorest are not bypassed through market
failures. Inappropriate land use regulations can easily
stifle the development of economic “clusters" and
the spontaneous creation and expansion of micro
businesses15. Another critical constraint in India is
heavy handed labour regulations which limit the
powers of companies io hire and fire staff and
thereby act as a disincentive to job creation. Beyond
a suitable enabling environment, businesses require
appropriate services - both financial and nonfinancial, which may not be available in the market
because of market failures.
As far as poor people’s livelihoods are concerned,
Urban Development moves the focus from
vocational training programmes for poor people,
to appropriate skill upgradation to match market
needs. It involves the development of a pro-poor
regulatory environment, engagement with a wide
range of players - businessmen, trade unions, trade
associations, employers federations - and the
development of a better understanding of the
informal sector and how to promote best practice
whilst protecting the rights of male and female
workers. The proposed DFID supported Calcutta
Urban Services Project plans to incorporate many
of these features, drawing on experiences with
DFID's Socially Responsible Business initiative,
alongside an engagement with issues of urban
governance.
3.2.6 Urbanisation
Urbanisation, or the process by which an increasing
proportion of a country’s population reside in
towns or cities, is an indicator of the transition to a
modern, and more developed society. Urban centres
grow because enterprises choose to concentrate in
areas where production costs are lower, support
services and markets are accessible, and a diverse
and skilled labour force is available. People migrate
to cities to take advantage of these employment
opportunities, and benefit from improved access to
services, and new social and cultural opportunities.
In turn, healthy cities support agriculture. A
prosperous urban centre provides markets, financial
resources and employment opportunities for
agricultural producers; a productive rural hinterland
provides the food, materials and labour that urban
centres require.
The rapid future growth in the urban population need
not necessarily increase urban poverty'. In fact, it
could have an impact on national economic
development and reduction on poverty' overall. As a
relatively land scarce, and labour abundant economy,
such a transition is in the interests of India, and should
arguably be welcomed rather than resisted.
Successful urbanisation, which creates clean and
healthy cities, vibrant economic centres, and the
conditions within which all citizens reap benefits,
will be dependent upon the achievement of most, if
not all, the development factors identified in this
section. It embraces an understanding of rural-urban
dynamics, and the process by which urban centres
grow; it requires macro planning at a national and
regional level, taking account of states and markets.
To reduce poverty, it also requires the development
of multi-faceted, multi-layered policies-combining
economic growth with pro-poor growth, and
engagement in direct actions to meet the real needs
of poor men, women and children.
15 Benjamin 1999
15
4 THE WAY FORWARD FOR DFID
The urban programme will also be guided by
4.1 Guiding Principles
stressed a focus on four States - Andhra Pradesh.
DFID's Country' Strategy Paper (1999), which has
The above sections have outlined a complex urban
agenda for India. Obviously DFID cannot take on
all these tasks itself, nor can it hope to have an
impact across the full spectrum of the urban
challenge. Instead it must prioritise, work to its
comparative advantages, collaborate closely with
others, and where appropriate, build on new
opportunities as they arise. In order to do this, DFID
India's urban programme will be informed by a set
of guiding principles.
means that DFID’s urban programme must
gradually reflect that commitment, and that actions
in other states will either be wound down, or must
demonstrate how they can contribute to this broad
agenda. The Country Strategy requires improved
linkages between the different aspects of DFID
supported initiatives in India, and between DFID
initiatives internationally. This means that sectoral
programmes must, where possible, complement
each other, and that DFID initiatives funded
As an overarching principle. DFID India will be
through other sources, such as IUDD sponsored
guided by the UN target to reduce the proportion
Knowledge and Research, must be coordinated with
of people living in poverty by one half by 2015,
DFID India's programme.
and the other International Development Targets
4.2 What will DFID do?
(IDTs). DFID's Urban Target Strategy paper will
provide the framework for engagement in urban
DFID will continue to focus on the issues captured
areas. In practice, the IDTs mean that we will work
in the Urban Ladder. It is likely that we will move
more closely with other international organisations
higher up this ladder to focus on Urban
(e.g. the World Bank, the Asian Development Bank.
Development and Urbanisation over the next few
and bilateral donors) and with the Government of
years. We will support the commercialisation of
India (including the Ministry of Urban
infrastructure and service provision, including
Development and Poverty Alleviation) to achieve
participation by the private sector. In this context,
reductions in urban poverty in India. We will also
we will look to draw on support from the global
explore opportunities to support a range of national
Public Private Infrastructure Advisory Facility
bodies, such as the National Institute of Urban
(PPIAF) and UNDP's Public Private Partnerships
Affairs (NIUA), Human Settlements Management
for the Urban Environment (PPPUE). We will also
Institute (HSMI) and Ail India Institute of Local
focus on the development of regional economic
Self-Government (AIILSG), who are well placed to
development strategies which will avoid beggar thy
develop local capacities to address the urban
neighbour’ subsidies, and promote improved
challenge.
infrastructure, business development and financial
All our work will either aim to reduce poverty
directly, or provide the enabling context within
which it will be reduced. We will learn from past
and current experiences, and ensure that the rights
of all poor men. women and children are taken into
account in all programme assistance. In approaching
these tasks, DFID will move towards more
programmatic support in partnership with others.
The justification for separate projects will be based
16
Orissa, West Bengal, and Madhya Pradesh. This
services, while addressing obstacles identified by
business in both rural and urban areas. Engagement
with the global Cities Alliance initiative, and in
particular, supporting City Development Strategies,
will enable us to work more closely with other
international organisations and the Indian
Government in developing integrated and coordi
nated approaches to tackling the urban challenge.
This is not to say that DFID will ignore the lower
on whether they provide opportunities for
rungs of the urban ladder. Rather, we will continue
modelling which can be scaled up.
to build on lessons learnt, and engage with these
issues, trom the informed standpoint of a broader
on their responsibilities under the 74"' CAA, as well
Urban Development and Urbanisation perspective.
as create an overarching Metropolitan Planning
For instance. Urban Governance and Urban Services
Committee for the city. This is a critical component
will continue to be key aspects of DFID's work.
of the urban governance agenda, and at the same
DFID will actively support initiatives to expand the
time reflects DFID’s interest in supporting an urban
opportunities afforded by decentralisation, and will
development agenda in a city where poverty, tn the
work, where appropriate, to strengthen the capacity
context of economic decline, is endemic.
oi State. Municipal and community based bodies to
take forward this agenda. The proposed Calcutta
Most of DFID’s work to date has been concentrated
Urban Services Project will work within these broad
frameworks.
within city based projects. Lots of lessons have been
learnt, and it is now timely to move on from that
approach taking account of the fact that the impact
DFID will also support initiatives which enable civil
of reform at city level is shaped by broader
society to improve poor people's capacity to articulate
institutional and economic processes at state and
their needs and participate in political processes, as
national levels. In practice this means that future
well as provide and manage particular services (eg
work with city level partners must be linked to a
financial services) themselves. This should lead to a
state or national level partnership, so that lessons
shift towards a more broad based range of initiatives,
learnt are mainstreamed in state and national policy.
addressing rite multiple needs of poor people. It may
Specifically, DFID will work increasingly with
include pilot initiatives with particular vulnerable
regional authorities and the national government.
groups, or an engagement with specific aspects of
This will ensure that the programme embraces the
government funded anti-poverty programmes, with
challenge of urbanisation more generally (rural-
a view to mainstreaming successful approaches with
urban linkages and planning), and takes account of
the Government of India and others. Such initiatives
the fact that much urban policy in India is still driven
might include work to support the Government's
by the centre. It may include funding for particular
programme to liberate Sanitary Workers, who clear
anti-poverty programmes and sectoral initiatives; it
night soil, or to improve targeting for self and wage
may also include strategic macro planning around
employment programmes.
the issues of regulation, enforcement systems,
4.3 Where will DFID work?
DFID's urban work in future will increasingly be
concentrated in our four partner states. Within states
themselves, it is likely that DFID will seek to move
training and capacity building, and the
decentralisation agenda itself.
4.4 How will this work be done, and
with whom?
towards a programme that reflects demographic
Over the past few years, DFID India has been
changes, including where the critical urban pressure
developing ever larger, more complex urban projects
points currently are. namely tn small and medium
as it has moved cumulatively up the urban ladder.
sized towns. The DFID supported Andhra Pradesh
The idea of a ring-fenced, or enclaved project, is
Urban Services for the Poor Project (APUSP)
becoming increasingly redundant and the newer
already reflects that emphasis (although APUSP does
projects in Andhra Pradesh and Calcutta are taking
not offer anything for small towns). This is not to
a more programmatic perspective, engaging directly
say that DFID will no longer support work in
in state level reform agendas. This approach is likely
India's metropolitan cities. DFID has a long standing
to continue. There is a price to pay however. It is
partnership in Calcutta. Here. DFID and the Asian
becoming increasingly difficult to define what
Development Bank are engaged in discussions with
should be inside an urban project, and what should
the Government of West Bengal about strategies to
not. This poses the question as to whether DFID
develop the capacity of Calcutta Metropolitan
should attempt to take on all the issues in the ladder
Area's 43 municipalities and 3 Corporations to take
17
within a single location project, or just take
particular slices or components. And if it does,
which ones should it take on? These questions will
require DFID to prioritise, and to work more
closely with others, who share a similar agenda.
Much of DFID's work in future will therefore be
through partnerships with other international
organisations and Indian agencies. Some initiatives
are already in place. Recently. DFID has begun to
work with the Asian Development Bank in Calcutta
to develop complementary work. It is also
considering how to incorporate urban indicators in
India's World Bank IMF supported Poverty
Reduction Strategy Paper (PRSP). At programmatic
level, it is likely that the World Bank may develop
complementary work to DFID in Andhra Pradesh.
The Cities Alliance, to which DFID is the second
biggest contributor, will form an important platform
for enhancing external donor support and achieving
greater impact on urban poverty reduction. In
addition, new partnerships with the private sector
are emerging, w'hile older partnerships with
Government of India bodies and para statals are
producing new ideas for future collaboration.
Opportunities to work with NGOs in urban areas
are increasingly opening up.
18
BIBLIOGRAPHY
Bailey. Richard (2000). Urban Governance and the
Poor. Paper prepared for DFID India Urban
Poverty Workshop. March 2000.
Kundu, Amitabh (2000b). Changing Structure of
Poverty and Employment in Urban India. Issues in
Formulating a Development Strategy. Paper
prepared for DFID India Urban Poverty Workshop,
March 2000.
Benjamin, S. (2000) Economic Development for the
Poor in Urban Areas. Paper prepared for DFID
Loughhead, S., Mittal, O. and Woods, G. (2000
India Urban Poverty Workshop. March 2000.
India: DFID's Experiences from a Social Policy
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India
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Dubey. Amaresh: Gangopadhyay, Shubhashis; and
Wadhwa, Wilima (2000 forthcoming).
‘Occupational Structure and Incidence of Poverty
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Government of India (1999). Ninth Five Year Plan
1997-2002. Volume 1, Development Goals, Strategy
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Impact Assessment Study (1999). Slum
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Harriss, J., Kannan, K.P., and Rogers, G.U990).
Urban Labour Market Structure and Job Access in
India: A study of Coimbatore ILO/IILS
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Assessment for a Greater Understanding of the
Urban Poverty Problem and Prioritising Related
Actions. Paper presented the Urban and City
Management Course, Goa, 9-21 January 2000.
19
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