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UK to help India build ‘mega-project’ - FT.com
British Prime Minister David Cameron has announced that India and the UK will build a new industrial corridor between Mumbai and Bangalore, in one of India's most ambitious infrastructure projects.
Speaking in Mumbai at the start of a three-day visit to Asia's third-largest economy, Mr Cameron said the project could involve entirely new cities in addition to road, rail and telecommunications connections, and special economic zones designed to foster business development.
The proposed route would connect India's financial centre of Mumbai, and then travel through the car hub of Pune before terminating in the technology capital of Bangalore along a route of approximately 1,000km.
The UK predicted "investment projects worth $20-25bn", although it did not give a detailed breakdown of this estimate. Three people familiar with the idea's development said that figures of more than $60bn had been discussed during its planning stages.
The project would be India's second major industrial corridor "mega-project", following a $90bn Japanese-funded plan between Delhi, the capital, and Mumbai, involving companies such as Hitachi, Mitsubishi and Toshiba.
However, the Delhi-Mumbai project has been dogged by bureaucratic difficulties and delays since it was announced in 2006. Its delivery date has been pushed back to 2017 at the earliest, leading to doubts that the new Indo-British venture could be speedily completed.
"It is a grand, ambitious project but it will have lots of problems of land acquisition and so on, and it is quite likely things will get delayed," said Professor Rajesh Chakrabarti, head of the Bharti Institute of Public Policy at the Indian School of Business in Bangalore.
"The government has faith in these mega-projects partly because they think they are efficient, and they hope that their effects will trickle down to those in the hinterland"‰."‰."‰."‰but the extent to which this actually happens remains to be seen."
British companies including engineering consultants Arup and infrastructure group Balfour Beatty have been involved in developing the project, and the two governments plan to announce this week a £1m co-funded feasibility study. After that is completed, the UK will further clarify the details of its contribution.
UK higher education minister David Willetts, who is accompanying the prime minister on his visit, said Britain was well placed to provide technical advice and financial support for a venture on such a scale.
"London is the world's greatest centre for the master planning of cities and industrial zones, with expertise in transport systems, structural engineering and architecture," he told the Financial Times.
"The UK was also the world's first country to undergo the revolution of urbanisation, when in the 19th century more people in Britain began living in urban than rural areas, something that only recently happened to the rest of the world. So we have a century of experience in this."
In addition to the risks of delays from India's complex bureaucracy, critics argue that special economic zones linking major urban centres often displace economic activity, while attracting workers even in the absence of adequate housing.
However, Terry Hill, chairman of Arup, who has been closely involved in the planning of the initiative, rejected this assertion, suggesting the project would involve extensive education and healthcare investment, in addition to transport, ports, IT and power.
"As well as the economic impact of hubs, we will also be considering the importance of social development along the spine between the cities," he said. "We will ensure this project is in the business of city-building, not slum-building."
British Prime Minister David Cameron has announced that India and the UK will build a new industrial corridor between Mumbai and Bangalore, in one of India's most ambitious infrastructure projects.
Speaking in Mumbai at the start of a three-day visit to Asia's third-largest economy, Mr Cameron said the project could involve entirely new cities in addition to road, rail and telecommunications connections, and special economic zones designed to foster business development.
The proposed route would connect India's financial centre of Mumbai, and then travel through the car hub of Pune before terminating in the technology capital of Bangalore along a route of approximately 1,000km.
The UK predicted "investment projects worth $20-25bn", although it did not give a detailed breakdown of this estimate. Three people familiar with the idea's development said that figures of more than $60bn had been discussed during its planning stages.
The project would be India's second major industrial corridor "mega-project", following a $90bn Japanese-funded plan between Delhi, the capital, and Mumbai, involving companies such as Hitachi, Mitsubishi and Toshiba.
However, the Delhi-Mumbai project has been dogged by bureaucratic difficulties and delays since it was announced in 2006. Its delivery date has been pushed back to 2017 at the earliest, leading to doubts that the new Indo-British venture could be speedily completed.
"It is a grand, ambitious project but it will have lots of problems of land acquisition and so on, and it is quite likely things will get delayed," said Professor Rajesh Chakrabarti, head of the Bharti Institute of Public Policy at the Indian School of Business in Bangalore.
"The government has faith in these mega-projects partly because they think they are efficient, and they hope that their effects will trickle down to those in the hinterland"‰."‰."‰."‰but the extent to which this actually happens remains to be seen."
British companies including engineering consultants Arup and infrastructure group Balfour Beatty have been involved in developing the project, and the two governments plan to announce this week a £1m co-funded feasibility study. After that is completed, the UK will further clarify the details of its contribution.
UK higher education minister David Willetts, who is accompanying the prime minister on his visit, said Britain was well placed to provide technical advice and financial support for a venture on such a scale.
"London is the world's greatest centre for the master planning of cities and industrial zones, with expertise in transport systems, structural engineering and architecture," he told the Financial Times.
"The UK was also the world's first country to undergo the revolution of urbanisation, when in the 19th century more people in Britain began living in urban than rural areas, something that only recently happened to the rest of the world. So we have a century of experience in this."
In addition to the risks of delays from India's complex bureaucracy, critics argue that special economic zones linking major urban centres often displace economic activity, while attracting workers even in the absence of adequate housing.
However, Terry Hill, chairman of Arup, who has been closely involved in the planning of the initiative, rejected this assertion, suggesting the project would involve extensive education and healthcare investment, in addition to transport, ports, IT and power.
"As well as the economic impact of hubs, we will also be considering the importance of social development along the spine between the cities," he said. "We will ensure this project is in the business of city-building, not slum-building."
