India should look toward its global peers to drive smart city improvements

Selected Indian Smart Cities and Their Global Economic Peers

India’s Smart Cities Mission represents one of the most ambitious urbanization initiatives ever, aiming to drive billions of dollars into infrastructure improvements across 100 different cities over the next five years. In addition to accelerating a variety of digital technology upgrades—similar to the “smart city” efforts in other global markets—India’s approach explicitly aims to leverage public dollars to attract private investment for various infrastructure projects.

Tackling such an enormous task, though, not only requires a more targeted, coordinated approach to urban development by India’s central, state, and local governments, but also a clear recognition of the unique economic differences across India’s cities.

Ideally, as municipalities assume greater control over future infrastructure plans and investments, they should customize their strategies in light of local industrial specialties and development conditions, while also considering other best practices already pursued by their global peers. Cities like Ajmer, Allahabad, and Vishakhapatnam (Vizag)—which are among an initial group of markets selected as part of India’s Smart Cities Mission—offer a useful baseline to demonstrate this point.

Using a combination of clustering techniques and Brookings’ proprietary Global Metro Monitor database, we can compare levels of output, income, and employment to determine which global markets are most economically similar to these three Indian cities. As our upcoming report on Indian Smart Cities will show, nine global markets from Asia to Africa to South America form an apt comparison, allowing India’s leaders to more easily gauge the potential impacts of different infrastructure improvements.

Selected Indian smart cities and their global economic peers

Selected Indian Smart Cities and Their Global Economic Peers 

Source: Brookings analysis of Global Metro Monitor data

In many ways, the cluster analysis illuminates just how much India’s urban economic development trails its peers, even next to other emerging markets. Per capita GDP in Ajmer and Allahabad lag far behind any of these peer cities, while Vizag can only match individual wealth in Alexandria. The industrial composition of India’s cities helps explain some of the wealth discrepancy; with a focus on commodity-intensive industries, these cities tend to rely less on higher-paying advanced manufacturing and service industries. Creating greater individual wealth will require these cities to develop industries further up global value chains—and digital technologies, such as broadband infrastructure and reliable electricity, can serve as key catalysts to that transition.

Metropolitan GDP per capita

Comparing infrastructure development can also inform future technological deployments. Here, again, the three Indian cities tend to lag behind their global peers on basic services. Less than 80 percent of their households have piped water, and less than 90 percent of their households have toilet access. Since it is difficult to imagine India maximizing its economic potential if it cannot support a healthy population, improving sanitation stands as a pressing priority, as is the case in Durban, South Africa. Reliable electricity access and widespread phone adoption also needs improvement in these markets, where they may find it useful to examine ongoing efforts in Brazil.

At the same time, it is equally important to consider what cities are not on this list of peers. None of the typical entrants on smart city “best of” lists—like Barcelona, Chicago, or Singapore—share the economic and infrastructure challenges in Indian cities. Just the opposite: these global cities often lead in advanced industrial development and cutting-edge infrastructure. This should give Indian leaders pause if they are looking to replicate projects underway in global markets like these. While the technologies themselves can work nearly anywhere, matching the objectives is the more important consideration when looking to identify best and worst practices.

Ultimately, India’s smart city investments will need to respond to local economic priorities specific to Ajmer, Allahabad, and Vishakhapatnam, but other global markets can provide a useful rubric to measure progress over time. Public and private leaders across India need to look beyond individual projects and consider places with similar challenges and opportunities, helping better inform future development strategies, deliver greater shared prosperity, and create a more opportunity-rich built environment.