Info Change India

Slowdown in urban growth

By Debolina Kundu

Population growth in urban India has been decelerating over the last three decades, busting the myth of an urban explosion. Most cities with populations of 100,000-plus have recorded a significant decline in their population growth, more so the million-plus cities, suggesting that they have become less welcoming to migrants. Delhi and Chandigarh recorded less than half the growth rate of the '90s, and Mumbai district has reported a decline in absolute terms during 2001-11

India is one of the fastest growing economies in the world, recording an average growth rate of over 5% per annum during the last two decades of the 20th century. GDP grew at 7.7% per annum during 2001-11. However, most of the growth has been concentrated in a few regions and large cities. Also, only certain sections of the population benefited from it, resulting in accentuation of income and regional disparities over time.

Urban India saw a deceleration in the growth of population during the last three decades, dismissing the spectre of over-urbanisation or an urban explosion. This made policymakers at the national and state levels concerned about the slow pace of urban growth, particularly at a stage of rapid economic growth that accentuated rural-urban (RU) disparities in the economic and social spheres. The annual exponential growth rate (AEGR) of urban population in the country during the 1950s was 3.5%. This was the highest the country had seen until that time, which led to the emergence of theories of 'over-urbanisation'. Formalisation of the criteria for identifying urban centres in the 1961 census resulted in a dramatic decline in urban growth figures in the 1960s. The 1970s, however, following the same methodology for identification of urban centres, saw a very high urban growth of 3.8%. The growth rate, however, came down to 3.1% in the 1980s. It went down further to 2.73% in the 1990s. Correspondingly, the percentage of population in urban areas has gone up from 17.3% in 1951 to 23.3% in 1981, and then to 27.78% in 2001.

The consistent decline in the growth rate of urban population over the past two decades of the last century led to the Tenth Plan expressing concern over 'the moderate pace of urbanisation'. The Eleventh Plan admitted that 'the degree of urbanisation in India is one of the lowest in the world' and considered planned urbanisation through new growth centres in the form of small and medium towns its major challenge. The Approach Paper to the Twelfth Plan also recognises the need to promote spatially-balanced urbanisation.

The level of urbanisation in the country increased to 31.16% in 2011 and the urban population recorded an annual growth rate of 2.76% during 2001-11. The 2011 census reported a dramatic increase in the number of urban agglomerations (UAs) (1): 91 new UAs came up in the past one decade. The Class I UAs/towns accounted for 70% of the urban population, their number increasing by 74 during 2001-11 from 394 in 2001 to 468 in 2011. The 2011 census also recorded an increase of million-plus UAs/cities from 35 in 2001 to 53 in 2011. These accounted for 42.6% of the urban population. The largest UA in the country is Greater Mumbai followed by Delhi UA. Kolkata UA, which held the second rank in the 2001 census, has been replaced by Delhi UA (Table 1).

It is important to note that the economically developed states have registered the highest level of urbanisation in the country in 2011 (Table 2). These states have also registered the highest growth rates and also the maximum increase in the number of census towns, with the exception of Uttar Pradesh (Table 3). The state of Kerala rapidly urbanised between 2001 and 2011. The share of the urban population increased from 25.96% in 2001 to 47.72%. Urban population in the state grew by 92.6% whereas rural population declined by 25.6%.

A detailed analysis of town-level data for the state of Kerala indicates that urban agglomerations/Class I cities account for about 93.74% of the population (Table 4).

Correspondingly, the level of urbanisation in Kerala increased from 25.97% in 2001 to 47.72% in 2011. Also, census towns increased by 362 during 2001-11. However, all Class I towns in Kerala registered a negative growth rate and a resultant decline in their population during 2001-2011, implying essentially substantial out-migration (Table 5). This questions the thesis of migration-led urbanisation in the developed states of India.

The idea of a possible slowdown in urban growth received empirical backing from the population figures of predominantly urban union territories and select metros, released for the 2011 census. Most cities with populations of 100,000-plus for which data is available have recorded a significant decline in their population growth, more so for the million-plus cities, suggesting that they have become less welcoming to migrants. A process of sanitisation and formalisation seems to be discouraging the inflow of rural poor to these cities.

Delhi and Chandigarh, for example, have recorded population growth rates less than half that of the '90s. Mumbai district, comprising the island city, has also reported a decline in population in absolute terms during 2001-11. The story is similar for Delhi where the present population growth is less than that of any decade in the last century. Here, New Delhi zone and central Delhi have lost one-quarter and one-tenth of their populations respectively. Among the large states, Maharashtra, where the percentage of urban population is over 40 and where an influx of migrants is an explosive political issue, has also recorded a significant reduction in its total and urban population growth.

Computation of population growth rates for Class I cities, keeping common towns for both the initial and terminal years, reveals an interesting pattern, as presented below. The population of cities/towns (municipal corporations and municipalities) only have been considered. The growth rate of 300 cities in 1991-2001 and 441 in 2001-2011 has been calculated by grouping the cities in size classes of 1 lakh to 1 million, 1 million to 4 million and 4 million-plus. Table 6 indicates that the growth rate has come down for all classes of cities in 2011 compared with the previous decade. However, the size class of 1-4 million has recorded the highest growth rate for both the decades. Importantly, the growth rate in the category of 1-4 million is in consonance with the high growth rate in the category of 1-5 million as indicated by the High-Powered Expert Committee projection for the same period. Greater Mumbai Corporation recorded the highest population in both the decades, followed by Delhi. Kolkata was the third populous city in 2001. In 2011, the Bangalore Municipal Corporation occupied the third position displacing Kolkata to seventh position. In fact, the corporation underwent an expansion in its municipal limits, which explains the increase in the share of urban population.

It is important to note that many cities reported a negative growth during 2011, indicating a decline in the population in 2011 as compared to 2001. This trend is most obvious in the state of Kerala, which has reported an increase in the level of urbanisation from 25% to 47.74% and a corresponding increase in the number of census towns. In fact, all Class I cities have reported a decline in their growth rates.

The total number of urban centres in the country has increased at a rate much slower than the urban population during the last century. The number had gone up by about 2,500 in the entire 10 decades. However, it has now gone up by 2,774 in just one decade, against the prediction of an increase of only 1,000 during 2008-30 by McKinsey Global Institute (MGI 2010).

The proposition that urban growth has not decelerated during 2001-11 thus goes against past trends and recent evidence. The important question is whether urban growth has remained high despite a decline in urban fertility because of the existing urban centres receiving migrants. Alternatively, is it due to a reclassification of rural settlements resulting in an increase in the number of new towns? It is evident that the increase in the level of urbanisation in the country is not a result of acceleration in the growth rate of small and medium towns but because of an increase in the number of census towns.

An important feature of urbanisation in India in the past few decades was the relatively small contribution of migration to the increase in urban population in India. Net migration from rural areas contributed about 21% to the increase in urban population in the 1990s, a little less than its contribution of 22.6% in the 1980s. Importantly, natural increase has been by far the largest source of increase in urban population (62.7% in the 1980s and 59.2% in the 1990s). The 2011 census would mark a significant departure, as a substantial amount of increase in the level of urbanisation would be accounted for by reclassification of rural areas into census towns.

India's heavily protectionist trade policy regime until the '90s had encouraged capital-intensive industrialisation in the country. This may be one of the reasons for the decline in the share of migrants. Rigid labour laws and reservation for small-scale units in production also encouraged capital-intensive industrialisation by restricting labour-intensive industrialisation. There was much slower growth in employment in the industrial sector in the past decade. According to the latest employment round (66th round), the share of regular employment in the public sector has registered a decline. The low share of manufacturing, no sizeable shift in workers moving out of agriculture, and the phenomenon of jobless growth have serious implications for migration in India and partly account for the decline in the pace of migration.

Structural transformation is typically associated with reduced dependence of the population on agriculture and increased migration from low-productivity agriculture to high-productivity sectors of industry and services in search of employment. Since these sectors are based in urban areas, rapid economic growth is normally associated with urbanisation. It may be noted that in India, the decline in the agricultural sector's share in employment in the last decade was small.

Also, the industrial sector failed to attract the workforce from agriculture. Indeed, the share of industry in total employment in the economy actually declined as mentioned earlier. The service sector recorded a sharp increase in the share of total employment. Since growth in GDP took place in highly skilled services such as information technology (IT), telecom and banking, or in sophisticated manufacturing industries like engineered goods and pharmaceuticals, it did not draw much labour from rural areas (HPEC, 2010). This may explain the decline in the growth of urban population in the recent decades.

The rural-urban differentials in productivity have widened since 1993-94, indicating that there is considerable scope for migrants to take advantage of the higher-productivity non-agricultural sectors. This, however, would demand higher skills and education levels of migrants in urban areas. The economy seems to be far from reaching saturation point in migration and it is reasonable to expect a hastening in the pace of urbanisation. The McKinsey Report (2010) (2) on India's urbanisation prospects estimates that over the period 2010-2030, urban India will create 70% of all new jobs in India and these urban jobs will be twice as productive as equivalent jobs in the rural sector. These would, however, require higher educational levels and greater skills for migrants. In fact, the latest round of the NSSO (64th round) shows that migration has gone up for educated and better-off sections of the population or those who have attained at least a certain degree of skills.

Conclusion

There has been growing and disproportionate importance accorded to 'metropolitan' cities in both policy pronouncements and urban research. It is important also to focus our attention on smaller urban centres particularly in the backward states, because of their weak economic base, high incidence of poverty, and lack of access to basic amenities. The central and state governments must recognise the possibility of urban impetus coming from the lower level by according 'statutory town' status to new census towns. They must also design a scheme similar to the Jawaharlal Nehru National Urban Renewal Mission to strengthen their infrastructure base and promote them as centres of distributed and inclusive growth. This would require revisiting the investment and sectoral scenarios projected for the urban economy in the Twelfth Plan, based on the High-Powered Expert Committee (2011) which proposes a model of urbanisation more top-heavy than that reported by the Provisional Population Census.

Note: The author is grateful to T C Sharma (NIUA) for his support in the data analysis

(Dr Debolina Kundu is an Associate Professor at the National Institute of Urban Affairs and has over 15 years of professional experience in the field of development studies. She has a PhD from Jawaharlal Nehru University, New Delhi. She has been engaged as a consultant with national and international organisations on issues of urban development, governance and exclusion, and is the author of several publications)

Endnotes

1 An urban agglomeration is a continuous urban spread constituting a town and its adjoining urban outgrowths, or two or more physically contiguous towns together and any adjoining urban outgrowths of such towns. The core town, or at least one of the constituent towns, should necessarily be a statutory town and the total population of all the constituent units, that is, towns and outgrowths of an urban agglomeration should not be less than 20,000 (according to the 1991 census)
2 McKinsey Global Institute, 2010

References

Census of India, Provisional Tables, Rural-Urban Distribution, 2011
Government of India, 'Report on Indian Urban Infrastructure and Services', High-Powered Expert Committee for Estimating the Investment Requirements for Urban Infrastructure Services, 2011
National Sample Survey Office (2010), Migration in India, 64th Round, July 2007-June 2008

Infochange News & Features, August 2013