Article courtesy of Ideas.Ted.com, written by Dan Kedmey.
What happens when a city is managed almost completely by private corporations? Visit Gurgaon, India, a boomtown of millions without a citywide system for water, electricity or even public sewers.
The city of Gurgaon, roughly a half-hour’s drive south of New Delhi, has survived without a functioning municipal government for roughly four decades. If the city of 2 million residents needs to pave a road, or hire police, firefighters or garbage collectors, a patchwork of private companies makes it happen. Or … not.
Kuni Takahashi/Bloomberg via Getty Images
“It’s a weird place,” says Shruti Rajagopalan, an economist at SUNY Purchase who grew up a short drive away from Gurgaon. She co-authored, with her colleague Alex Tabarrok, a 2014 study of its strange inner workings. “It shouldn’t exist, theoretically.” And yet, the city is a magnet for India’s middle class. The population has swelled by more than 1,600 percent over the past 25 years. “People are just clamoring to move to Gurgaon,” she says. Which raises an intriguing question: Should other cities embrace Gurgaon’s radical experiment in privatization? She explains why, despite its pitfalls, Gurgaon offers a strangely promising blueprint for urban development.
An unplanned city can grow at astonishing speeds. In 1991, India’s legislature passed a raft of economic reforms that opened sectors of the economy to foreign companies. At the time, Gurgaon was an unexceptional town of 121,000 people surrounded by vast tracts of fallow land. By a regulatory quirk, the land around Gurgaon was managed by a single agency, the chief minister’s office in the state of Haryana, versus India’s usual thicket of competing government agencies. It meant that developers’ plans in Gurgaon could be approved in a matter of days, not years. The result? Fast-track approvals for office parks, luxury condominiums, five-star hotels and golf courses. Half of the Fortune 500 companies launched satellite offices in the city’s gleaming high-rises, and it’s home to one of the largest shopping malls in the world. “There are parts of it that look like Singapore or Hong Kong or any world-class city,” says Rajagopalan. But rushing into a bureaucratic void posed a challenge for developers: Who, if not the state, would provide basic public services? “If you ask a regular person, ‘Would you want to live in a city that doesn’t have a functioning sewage system or garbage disposal or a good network of roads,’ they’d probably say no,” says Rajagopalan. So the developers had to convince potential renters to say yes — by filing in the gaps in the city’s sparse public services themselves.