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By Darryl D’Monte What happens when top honchos of companies and international consulting firms decide how cities should be managed? You get thousands of crores in public funds spent to meet the needs of 125,000 of Mumbai's motorised elite
 The Vision Mumbai document, titled ‘Transforming Mumbai into a world-class city’, has been brought out by Bombay First – comprised of CEOs and other top Bombay executives -- and McKinsey, the international consulting firm. McKinsey was hired by the Maharashtra government to advise it on how to plan for the city in the next 10-15 years. Bombay First had employed its services even a decade ago for advice on ‘Positioning Maharashtra for leadership in the economic liberalisation era’. The problem with Bombay First and McKinsey is that, however well-meaning, they take a corporate perspective on as complex an issue as running a huge, diverse metropolis, one of the biggest in the world. The very first recommendation by McKinsey for Mumbai reveals this. In calling for an investment of Rs 2,00,000 crore or $40 billion within 15 years, it wants the city to grow at 8-10% per annum by developing hinterland manufacturing and “making Mumbai a consumption centre”, whatever the latter implies, as well as a service hub. This is a tall order, considering that Asiaweek has ranked Mumbai 33 out of the top 40 Asian cities, while Forbes lists it 124th out of 130 cities as far as its quality of life is concerned. It has obviously a long way to go. With the precipitate decline in Mumbai’s premier industry -- cotton mills -- followed by closure of factories in heavy engineering, chemicals and pharmaceuticals, including multinationals, there is a huge drop in employment in the organised sector. Even in the white-collar sector – in banks, insurance companies and other service industries – employment is stagnating, if not declining. One can accept McKinsey’s prescription for shifting manufacturing to the hinterland only if it details this transitional process and not, as sundry politicians and members of the elite suggest from time to time, expect workers to pick up their families and shift to cities like Pune, Nashik, Nagpur and further afield. There is also no hint in the report of how workers rendered jobless in mills and factories will be retrained – or even how fresh entrants will be trained – to switch to jobs in the service industries if they choose to stay on in Mumbai, as it is clear that an overwhelming majority would prefer to do. It targets four “high-end” services for this purpose: financial services, healthcare, IT and ITES (IT enabled services) and media/entertainment for this purpose. As far as financial services and IT are concerned, there is no doubt that these industries are increasingly automated: as everyone experiences in a bank nowadays, there is little human contact left, with computers taking over virtually every function. As those who have studied the FIRE – finance, insurance and real estate --- economy of cities like New York point out, there is an increasing tendency for fewer and fewer people to be hired in these industries, albeit at higher and higher salaries. With over half of Greater Mumbai’s 12 million people homeless, does McKinsey seriously expect this burgeoning class to take to computers as ducks to water? Even the Shiv Sena, with its nativist rhetoric, has been training some boys and girls to take to IT, but this is more symbolic than real, given the overwhelming numbers involved. The proposal to make Mumbai a ‘consumption centre’, to exploit its position as the country’s commercial capital, is most puzzling. According to McKinsey, “it has not yet fulfilled its potential of becoming India ’s and, eventually, Asia ’s consumption centre”. It wants to achieve this by reducing city taxes, which the consulting firm believes are much higher than in other Indian cities. When it cites road tax as an example, however, it is treading on tricky terrain and betrays its corporate bias. While motorists complain of being overtaxed, the harsh truth is that the one-time tax that purchasers of cars pay today is a pittance when spread over the lifetime of the vehicle. Considering that Mumbai has, or had, some of the most expensive real estate in the world, cars – which occupy such space either when travelling or parking – get off virtually scot-free. McKinsey does want to increase the capacity of local railways and ensure that people travel more comfortably, but public transport – as Vision Mumbai itself acknowledges – is being funded by the World Bank in the second phase of the long-delayed Mumbai Urban Transport Project, as well as by the Mumbai Urban Infrastructure Project. McKinsey specifically states, as the very second item in its eight-pronged programme, its mission to “improve and expand mass and private transport infrastructure, including linkages to the hinterland”. The emphasis on ‘private’ cannot be overlooked. By its very definition, this refers to motorised transport which comprises only around 8% of Mumbai’s traffic, but contributes 60% of the city’s pollution. Indeed, Mumbai is somewhat unique among metropolises in developing countries in that as much as 87% take public transport (buses and trains), while the remaining 5% consists of ‘intermediate public transport’ (taxis and autorickshaws). McKinsey is for the coastal expressways – like the Rs 1,565 crore Western Freeway Sea Link, to give it its official title, from Worli to Nariman Point. This will connect with the Rs 700 crore Bandra-Worli Sea Link, on which construction has recently restarted. It then commends the Trans-Harbour Sea Link from Sewri to Nhava Sheva on the mainland. This is a particularly dubious scheme as masterminded by the controversial Maharashtra State Road Development Corporation (MSRDC). It had at a public hearing a few years ago put the cost of this link at Rs 6,000 crore with a rail link as well, and Rs 4,000 crore without, Most recent estimates cite only Rs 2,000 crore, which is sleight of hand, since it apparently obfuscates on the approach roads to the bridge. McKinsey, consisting of professional international consultants, is far more honest in putting out estimates than the MSRDC, which has distinguished itself as a construction agency for roads (as its very name reveals) but now virtually decides on road schemes, without even consulting the Mumbai Metropolitan Region Development Authority (MMRDA), the supreme planning agency. McKinsey calculates that the rail and road trans-harbour link will cost between Rs 8 -10,000 crore. Assuming that the road bridge alone will cost at least Rs 6,000 crore, we get a pretty good idea of what is being spent on motorists exclusively. A back-of-the envelope calculation reveals that the grand total – which is by no means an exhaustive list – is almost Rs 10,500 crore, including Rs 1,500 crore on the 55 fly-overs which the BJP-Shiv Sena government built and Rs 700 crore on the Eastern Freeway Sea Link, which will be a necessity once the trans-harbour bridge comes up. To add insult to injury, for a variety of reasons, the MSRDC has not been able to charge tolls on the city’s fly-overs, with the result that it is running these schemes at a loss. On the Western Freeway, it plans to charge motorists Rs 100 a day from Bandra to Nariman Point. If the 125,000 motorists who ply this route decide this is too expensive, it will drive the MSRDC further into debt. Who is going to pay at the end of this colossal diversion of public funds to meet the needs of the motorised elite, which clogs the city’s arteries and renders bus transport increasingly time-consuming? This is the trouble with prescriptions by international consultants, who in this case claim they take their cue from Shanghai, where Mayor ‘one-chop Zhu’ earned this epithet for cutting through red tape to set up the high-rise financial district of Pudong across the bund in China’s commercial capital. McKinsey also extols the experience of Cyberabad – but Vision Mumbai was presented in September 2003 and it will presumably remain deafeningly silent on the success of Hyderabad after the unceremonious ouster of Chandrababu Naidu’s regime in the elections this May for turning its back on the huge majority of its rural population, including farmers who committed suicide because of steep debts. On Bangalore too, Vision Mumbai waxes eloquent on how the Bangalore Agenda Task force, headed by Nandan Nilekani, the CEO of Infosys, has come to the rescue with some minor innovations like citizens’ report cards to increase accountability. While these are undoubtedly welcome initiatives, they only touch the fringe of the problem. By McKinsey’s own reckoning, the Task Force has raised Rs 15 crore through corporate donations, which will hardly set the Cauveri on fire. Meanwhile, Bangalore ’s roads are as bad as they were and the other infrastructure hasn’t improved. Citizens observe how the Task Force has been taking credit for the property self-assessment scheme, when it was actually a former municipal commissioner who apparently envisaged it. Instead of such tinkering by top honchos of companies, the state government would be better off strengthening the local self-government system under the 74 th constitutional amendment. This is far more democratic and gender-sensitive than anything that corporate leaders can envision. The most crass of all McKinsey’s proposals is to corporatise key city departments, which Narayana Murthy of Infosys and others have been endorsing as having a CEO for a city instead of a municipal commissioner. As a McKinsey managing director in Mumbai put it, “We know that it won’t happen since there’s no consensus for it. So we are recommending that the Maharashtra government adopt the Bangalore model for Mumbai.” It is high time that such proposals were put through the most rigorous public scrutiny. Maharashtra is Rs 93,000 crore in the red, and is cutting half its development spending for this reason. Under Vision Mumbai, it is earmarking Rs 130 crore simply for the “refurbishment” of Marine Drive , including Rs 25 crore for the renovation of the facades of the Marine Drive art deco buildings. If the new Congress coalition doesn’t want to be booted out, like some other recipients of McKinsey’s advice, it should do some hard rethinking on whose vision for Mumbai will work for the common good. InfoChange News and Features, November 2004
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