Wednesday, September 20, 2017

Interview - Sanjay Dutt (Cushman & Wakefield)

There are enough examples of urban smartness for India to create multiple smart cities in the future

 

 

With over 20 years of experience as a real estate professional he leads Cushman & Wakefield’s India operations along with spearheading the growth strategy for other South Asian markets, including Sri Lanka, Bangladesh, Nepal and Pakistan. SANJAY DUTT, EXECUTIVE MANAGING DIRECTOR, CUSHMAN & WAKEFIELD, SOUTH ASIA, spoke to SHRIKANT RAO on the plan to set up 70 smart cities across India.

 

 

 

What do you think of India’s plans to set up Smart Cities? How implementable is that?

 

I think India already has smart cities. If you go back to Chandigarh, or look at NCR, Hyderabad or some of the existing other Indian cities we know there is a lot of scope.  You see a lot of chaos on the surface but they are still managing resources and infrastructure in the most efficient and optimum manner. So it really depends on the context of the smartness you are looking at. Actually if you look at Mumbai you see deteriorated infrastructure. There has been no substantial investment in replacing age old lines to begin with but the fact is that the government is doing a smart job of managing such old infrastructure and carrying millions of commuters every day. I think it is a smart city in that sense. So the real definition of smart city is making optimum use of its limited resources, in the most energy efficient cost effective manner with least disruption to nature and life. As regards the creation of smart cities it might seem that it is not something that we are geared up as a country currently because it requires doing work ground up – it requires billions of dollars to replace existing old infrastructure.

 

 

 

They are talking of creating new cities here?

 

Yes I was coming to that. I think we are talking about creating smart cities only when you create new cities. If you look at Gurgaon in comparison to Delhi it is a new city in the real sense and yes it can be turned into a smart city much more easily than the other. We have very large infrastructure and industrial projects coming up connecting NCR to Mumbai. On that corridor you will see a lot of new cities that will emerge for sure. Outside of Mumbai you see Panvel coming up as a good example of integrated large townships which are very optimised and well managed with infrastructure. I think there would be scope if you look at some of the large hill projects like Amby valley and Lavasa which could be early examples of Smart Cities but in their own way.

 

 

 

But would you characterise those as smart cities in the sense of say a South Korean Songdo?

 

I am only trying to say there is an example of scale available in the country that has been executed recently because otherwise there are a very few examples for us to quote. If you pick up those cities and then you say what will make those places smart, more livable, it would mean connectivity for Mumbai and Pune to begin with as people need access; then you need industry to be housed within that area that you have created a city out of; not just a city but all those things which will make a smart difference. So you will see in the next 10 or 15 years a few examples of those coming up in different parts of the country which will be India’s smart city role models. The next urbanisation that will take place will happen in those cities than the conventional cities that you see so far.

 

 

 

So what are the elements that will have to be woven into these urban conglomerations to make them smart?

 

To begin with no city can become a smart city unless it is planned in an integrated fashion where all services are provided by various bodies of the government. There has to be a government structure to begin with and then put the right, smart if you like, components later. Smartness is not just about doing things right. It is also about doing things collectively in an integrated manner and implementing them in the right way so if you are digging up a road, laying a concrete path and then public works department comes then digs it up again and puts a pipe underneath for sewage it’s a disaster. A smart city is truly one when the government structure is smart and integrated, where all the aspects are handled under one single board and is implemented with a next 20 to 30 year horizon if not a 50 or 100 year horizon.

 

 

 

So how should the government go about doing this?

 

I think the government has tried to do that. If you look at CIDCO for instance when it was formed its objective was to create a smart city in Navi Mumbai. I think for those days it was executed well. It was a chemical zone area where they were trying to bring light which at that time did not exist. They built roads, bridges, residential offices, created IT parks and industrial plots at MIDC. Since then there has been no government quest to perfect the short comings. So it boils down to whether we will have enough political will or not.

 

 

 

Do we have the wherewithal with respect to technology when it comes to constructing Smart Cities?

 

I think we do. India is such a big country and with the federation of states fortunately the wrong doing of one state does not impact on the other. I mean there is a way of looking at it: if one state does a good job then it will become a role model. For example the wave we saw happening in Andhra Pradesh creating an IT pool. Such examples will be more than enough for India to be able to create multiple such smart cities in the future. I am sure it will happen.

 

 

 

From a real estate perspective what would be the challenges? Smart Cities will require construction and building structures smartly, those that are sustainable?

 

When infrastructure gets built prices come down – this has not happened till date. I think consumers and end users will benefit the most, investors will also benefit because the bubble will not get formed, there will be more stable growth in prices now. Due to poor infrastructure demand is concentrated in a few cities and a few micro markets. There the land and property prices are going up which possibly and potentially may end up creating a bubble which will lead to a real estate impact nose dive in about 3 to 4 years if suddenly the supply hits the road and the economy goes through another correction. So the long term benefit would be that if you provide quality infrastructure and show that there is a healthy migration and enough economic activity in multiple locations of the country and development not concentrated in once place, you will see balanced growth and a stable real estate environment.

 

 

 

Who  are the players in the construction and infrastructure sector you foresee playing a major role in these developments? Will we have to rely on overseas majors to do the job? 

 

Any company which is gearing itself for a sustainable long term platform and is able to deliver solutions that the government, the developer and the people would expect for the next 10 to 15 years, would qualify. I think India has enough competencies. It is  just that the government needs to  create an incentive for the players, basically remove hurdles by bringing in technology tools and equipment , creating skills sets which are missing  I am sure this country will deliver smart solutions faster than any country in the world. I think most companies in India are already doing that. I am aware of an Indian software company which is managing the London traffic system more efficiently than any company in the world. Likewise you have many multinational firms that are helping developed nations to become smarter. I think the expertise and the skills are already known. If you add digitisation software to this internet, which is increasingly becoming a part of our mainstream lives, in no time India will become a global leader in smart city solutions. 

 

 

 

So you see these 70 smart cities happening in our lifetime?

 

Absolutely, because we know the expertise is there. However, the scale of expertise is missing – right now it is not enough to reach every corner of the country. 

 




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