Chapter: 1 || 2 || 3 || 4 || 5 || 6 || 7 || 8 || 9 || 10 || 11 || 12 || 13 || 14 || 15 || 16 || 17 || 18 || 19 || 20 || 21

Housing, Urban Development, Water Supply and Sanitation

HOUSING

12.1 In fulfilling the basic needs of the population, housing ranks next only to food and clothing in importance. A certain minimum standard of housing is essential for healthy and civilised existence. The development of housing, therefore, must enjoy high priority in a poor society such as ours where housing amenities are far below the minimum standards that have been internationally accepted. Housing activity serves to fulfill many of the fundamental objectives of the Plan: providing shelter, raising the quality of life particularly of the poorer sections of the population; creating conditions which are conducive to the achievements of crucial objectives in terms of health, sanitation and education; creating substantial additional employment and dispersed economic activity;improving urban-rural and inter-personal equity through the narrowing down of difference in standards of living and last but not least, generating additional voluntary savings.

12.2 The National Buildings Organisation (NBO) have estimated that the housing shortage in 1981 was around 21 million dwelling units (16 million in rural areas and 5 million in urban areas); the shortage at the begining of the Seventh Five Year Plan has been placed at24.7 million units (18.8 million in rural areas and 5.9 million in urban areas)¹.

12.3 The above estimates of backlog of housing shortage are only rough. But apart from the existing backlog in housing, the increase in population between 1985 and 1990 would generate roughly an additional requirement of housing units to the extent of 16.2 million, of which 12.4 million will be in rural areas and 3.8 million in urban areas. This means that even if the aim is only to prevent an increase in the magnitude of backlog in housing shortage, it would be necessary to build during the Seventh Plan period around 16.2 million dwelling units. This fact makes evident the gigantic magnitude of the housing problem. This problem cannot be tackled in a meaningful way, if housing activities are left to follow the past pattern of slow and unsystematic growth. There is need for radical orientation of all policies relating to housing. The most important among these are: the provision of finance for house construction on a large scale, development of suitable land sites in urban areas, provision of house sites in rural areas, developing and applying low-cost technology in house construction an policies relating to rent control.

12.4 While all sectors of the economy—the Govern ment sector, public enterprise sector, the private corpo rate sector, the co-operative sector and the householi sector—would have to participate in housing activities in , coordinated manner, the major responsibility for housi construction would have to be left to the private sector, ii particular the household sector. Building houses accord ing to the differing preferences and requirements o different households and economy in house constructior can become possible only if the home owner himsel participates or becomes responsible for house construction. What has inhibited large scale house construction b} households is the inadequate provision of institutiona finance for the housing sector so far. Two major desiderata for a quantum jump in house construction in urban anc semi-urban areas are the mobilisation of resources for the housing sector through the establishment of a proper se1 of institutions and the development of suitable housing sites on a large scale. The poorer sections of the society, however, would need subsidisation and also assistance in house construction from the public sector. In this context, the public sector's role shouldbe three-fold. First, largely promotional, to initiate steps to mobilise resources for the housing sector on an adequate scale; second to continue the efforts to provide subsidised housing to segments of the rural poor and to other economically weaker sections (EWS) of the community like slum dwellers and dock and plantation workers; and third to undertake land acquisition and development in urban areas and providing house sites in rural areas. Housing authorities and Housing Boards should concentrate on the last activity instead of going in for direct construction of houses. The second activity would be performed mainly by the Housing and Urban Development Corporation (HUDCO) for the poorer sections of the society. For other sections this would be performed through a network of house financing institutions with an apex bank for re-finance.

12.5 Public sector Plan expenditure on housing during the Sixth Plan is estimated at Rs. 1,839 crores; in addition, public enterprises are estimated to have spent around Rs. 275 crores on housing. Thus the total expenditure on 1. The extent of shortage has been worked out in terms of certain minimum standards; therefore it should not be assumed that an equivalent number of families are entirely shelterless. Nevertheless, the figures fairly reflect the great inadequacy of housing in the country. housing through agencies of the public sector amounted to Rs. 2,114 crores during the Sixth Plan period. The physical achievements have been reported in Table 12.1

TABLE 12.1   Physical Achievements during the Sixth Plan (1980-85) 

12.6 The major part of investment in housing is undertaken by the private sector. Reliable data on investment in private housing are not available. According to the estimates made by the Central Statistical Organisation (CSO), gross fixed capital formation in residential buildings in the private sector, including public sector undertakings, amounted to Rs. 3,054 crores in 1980-81. Assuming that the share of the public sector undertakings in this was of the order of Rs. 70-80 crores, gross capital formation in housing in the private sector would have been around Rs. 2,980 crores in that year. According to CSO figures, private sector investment in housing between 1974-75 and 1979-80 increased by about 62 per cent, or at about 12 per cent per annum. A 10 per cent growth rate could be assumed for the Sixth Plan period.

12.7 On this basis, the private sector investment in housing during the Sixth Plan would have amounted to Rs. 18,000 crores. A growth rate in private sector housing in the Seventh Plan period equal to that assumed for the Sixth Plan period would imply an investment of around Rs. 29,000 crores. In fact, if the backlog in housing is to be reduced to any significant extent by the end of the Seventh Plan, a much larger investment than Rs. 29,000 crores would be called for. This underlines the need for a major effort to mobilise resources for housing and for the Government to take other steps needed, such as to make available developed land on the required scale on the one hand and to make the necessary policy changes to remove obstacles in the way of housing activity, e.g., modification in the rent control laws, on the other.

12.8 The time has now come for the Government to set before itself a clear goal in the field of housing and launch a major housing effort: not so much to build but to promote housing activity through the supply of fiscal and financial infrastructure such that every family will be provided with adequate shelter within a definite time horizon. As far as possible, the public sector should not assume direct house construction except in the case of the weaker sections of the society. This is not to minimise the role of the Government. As stated earlier, the Government has to play an active role through developing the necessary delivery system in the form of a housing finance market and taking steps to make developed land available at right places and at reasonable prices.

12.9 The most crucial need for housing development at the present time is the establishment of a proper and diversified institutional structure for housing finance and construction. The strengthening of the existing institutions like Housing and Urban Development Corporation (HUD-CO) and the creation of new institutions like housing co-operatives and building societies would be necessary. The expansion of the Housing Development Finance Corporation (HDFC) type of activities could also be considered. While HUDCO would concentrate on the provision of subsidised finance to the poorer sections of the society, the HDFC would continue to cater to the clientele coming largely from fairly well-to-do sections of the society. The vast majority of house-seeking individuals and families would have to be looked after through the creation of local level housing finance societies. These societies would raise deposits from the public, mainly from the would-be house owners, and thus stimulate private saving. In addition, they should have access to funds from the capital market through the intermediation of different financial institutions. For this purpose it would be desirable to set up a specialised housing finance institution. In course of time steps should also be taken to develop a secondary mortgage market in housing.

12.10 The apex housing finance institution should be able to draw funds from the capital market as well as from financial institutions. Commercial banks should be permitted to participate on a larger scale than hitherto in housing finance activities.

12.11 As stated above, the public sector has to concentrate on the provision of houses to the poorer sections of the society. HUDCO, in conjunction with the State Governments, would continue to play an important role in the provision of finance to these sections for house-building activity. In addition, the public sector has to play an important role in the provision of housing sites in the rural areas. There is urgent need to adopt low-cost housing techniques, particularly for mass housing schemes for low income groups. Use of alternative building materials like lime, mortar, surkhi, secondary species of timber, etc. in place of traditional building materials like cement, steel, bricks and primary species of timber should be widely adopted.

12.12 Prefabricated technology which has been adopted in some western countries requires to be considered for large scale adoption in our country provided the cost factor is favourable for its adoption. The relative advantages of factory production of prefabricated components of Indian Standards Institution (ISI) standards (like beams and blocks, roofing materials and doors and windows) vis-a-vis traditional building methods, may be assessed. If any fiscal measures stand in the way of adopting large-scale prefab, technology because of its being based on factory production, ways and means may have to be explored to overcome this handicap.

12.13 Direct subsidy to urban housing should be avoided as far as possible. Where direct subsidies are absolutely unavoidable, they should be small and be in the form of insfrastructure facilities so as not to create large differences between the market values and the subsidised prices.

12.14 Against this background, the Seventh Five Year Plan (1985-90) has the following objectives:

1. Promotion and encouragement of self-help housing;
2. Provision of house sites to the balance of rural families identified so far and assistance for construction of dwellings for those rural families already provided house-sites;
3. Cost of housing units under the social housing schemes should be such that they are within the paying capacity of the targetted groups, like Economically Weaker Sections (EWS), Low Income Group (LIG) and Middle Income Group (MIG);
4. Providing stimulus and support for private housing especially for the middle and lower income groups so as to channel increased savings into housing. This will have to be accompanied by steps needed for reducing the cost of urban land;
5. Securing reduction in construction costs not only by adopting low-cost housing techniques and standards but also modifications in building bye-laws, land use control, minimum plot requirements, etc.; and
6. Harnessing science and technology efforts for improving building technology and development of cheap and local building materials.

The progammes for achieving these objectives are as follows:

Rural Housing

12.15 The Minimum Needs Programme (MNP) and the 20-Point Programme give a high priority to the rural house-site-cum-house construction scheme. It is estimated that there were 12.2 million landless families as of March 1985. As against this, the number of families provided house-sites is estimated at 13.07 million. The "excess" achievement is due to the fact that in some states the scheme was extended to smaller municipalities, and in some states the beneficiaries included some belonging to the upper income strata of the rural community. However, state-wise analysis reveals that still 0.72 million landless families among the total estimated landless families of 12.2 million require to be provided with house-sites. It is felt that before extending the coverage of the scheme to smaller municipalities and to those belonging to the upper income brackets of the rural community, efforts should be made to provide construction assistance to those families already provided house-sites according to the original criteria of the scheme. The Sixth Plan envisaged provision of construction assistance to 3.6 million families; in fact only 1.9 million families could be assisted.

12.16 Even though the Sixth Plan envisaged a modest level of Governmental assistance under the scheme, many State Governments were providing substantially higher levels of assistance. In order to make the operation of the scheme more realistic, it is proposed to provide assistance to the extent of Rs. 500 per family for provision of developed house-sites of 90 sq.m. each and assistance of Rs. 2,000 per family towards construction cost. All labour inputs will have to be provided by the beneficiary. The Seventh Plan includes a provision of Rs. 577 crores for this programme. Of this, Rs. 36 crores would be utilised to provide house-sites in respect of those states where there are landless families still to be provided house-sites and Rs. 541 crores would be utilised for the provision of construction assistance to 2.71 million families. Needless to say that if the above targets are to be achieved during the Plan, the State Governments will have to adhere to the norms and standards envisaged in the Plan. These have been considerably liberalised compared to the Sixth Plan.

12.17 On account of the resource constraint, only a limited provision is made in this regard in the State Plans. Besides this, HUDCO has been providing funds for rural housing. This would continue. A specified proportion of General Insurance Corporation (GIC) funds are also earmarked for rural housing. Taken together, the funds for rural housing from public institutions (HUDCO and GIC) would roughly amount to Rs. 240 crores during the Seventh Plan.

Urban Housing

12.18 As already stated, Government's role in the field of urban housing has per force to be promotional. The major effort will have to come from the private sector, Government's role will have to be restricted to the improvement of slums, direct provision of housing to the weaker sections of the society and encouragement and support of housing finance institutions that promote

Table 12.3 Seventh Plan Outlays on Housing   (Rs.crores)

@ Included in 2 above. URBAN DEVELOPMENT 12.25 The Sixth Plan recognised that although the share of urban population of India was small, estimated to be only a little over 20 per cent of the population of the country, the absolute size of about 107 million people living in urban areas in 1971 was large by any standards. The urban growth registered in 1971 -81 has followed the pattern of growth in the previous decade. As a per centage of total population, the increase has been from 20.22 per cent to 23.73 per cent. In absolute terms it has meant an increase in urban population from 107 million in 1971 to 156* million in 1981 (provisional). Certain important aspects of this increase require to be noted. While the growth of urban population as a whole was 3.86 per cent, Class I cities grew by 4.6 per cent and Class II cities by 4.2 per cent. The number of towns increased from 2581 in an increasing proportion and area of urban conglomerations are being turned into slums.

TABLE 12.4 Distribution of Urban Population among Different size Classes of Towns

Notes:—1. The latest data available from the Registrar General's Office place urban population at 160 million. The break-up of this by size classes of towns is, however, not available. 2. Figures in brackets are for 1971.

12.28 In view of the extremely serious situation in which the urban bodies find themselves, a vigorous multi-pronged attack is needed to reverse the trend and to restore conditions of healthy growth. The following may be identified as the major constituents of a comprehensive plan for urban development:

12.29 A thorough re-examination of the p

1. the planned and integrated development of small and medium towns and cities along with slowing down of the growth of big metropolises;
2. revitalisation of civic bodies;
3. thorough-going reforms of municipal tax systems and municipal administration in general;
4. concentration on the improvement of slums and the provision of basic municipal services; and
5. for this purpose to work out schemes of regular devolution of funds from State Governments and to establish the necessary institutional framework for channeling capital funds for the improvement of urban infrastructure.

rocedures currently used in the planning of metropolitan areas and the evolution of approaches and methods more suited to the new imperatives arising from the intensification of urban growth all over the country are called for.

12.30 Urbanisation is a phenomenon which is part and parcel of economic development in general. Certain activities are best performed in, indeed require, agglomeration of people. Planning of urban development should essentially be supportive of the economic development in the country, state or sub-region, be it in agriculture, extractive industry, manufacturing industry or in the tertiary sector. The provision of urban services such as transport, communication, water, sanitation and shelter alone is usually unlikely to stimulate large-scale urban development. It is important to time investments in urban services and shelter to coincide with investments in agriculture and industry, mining and commerce which provide sources of permanent employment. Therefore, a proper urban development approach must consist of two constituents. The first is the interaction between physical and investment planning and the second is the preparation of regional and sub-regional urban development plans to make the first possible. Industrial location policy must be made to subserve regional and urban planning. During the Seventh Plan a concerted effort should be made to channelise private industrial investment in the vicinity of small and medium towns so that migration of population is diverted to these from going to the metropolises. The same principal should be applied to public sector investment.

12.31 Regional urban systems can be identified according to their economic, climatic, geographical and transportation characteristics. Planning for urban development can be done on the basis of such regions and according to the relative need and function of each town in its regional context. Thus, within each planning zone allocation to towns should be made more on the basis of their functions with particular emphasis on their respective industrial and employment potential than on their sizes.

12.32 Within towns and cities there is a much greater need for community participation and for more private initiative and investment in urban development than existing at present. The delivery of basic public services to everyone is simply not feasible without such an approach. Slum improvement, sanitation, garbage removal, etc. can be organised and even paid for at the community level. Resources for urban development are very limited and will continue to be so in the foreseeable future given the existence of wide-spread rural poverty and lack of basic services in rural areas. This would call for better allocation of existing funds and mobilisation of additional funds by the municipal bodies themselves. A realistic assessment of needs for basic infrastructure and services is, therefore, a pre-requisite for efficient and effective planning. 12.33 The planning for metropolitan development should provide for:

1. coordination of city level investment plans with higher (State and Central) level planning and resources allocation exercises;
2. coordination of city level investment plans with resource availability and with physical planning;and  \
3. the fostering of a close relationship between the norms and standards used in physical planning with the   socio-economic realities prevailing within our cities. More explicitly the needs of the poor must   be taken account of more specifically in all physical planning exercises.

12.34 In the small towns and the new centres, the strategy should be to purchase lands in concentric circles, at short notice, before land values begin to rise, quickly providing the infrastructure facilities within a period of 2 to 3 years and then selling the land to the public and private sectors. In this way, the public authority could make two major gains: (i) the profit from site development and (ii) the gains through passage of time. The gains could be used for various purposes. If the public authority makes non-speculative purchases continuously, withdraws land for short periods and continuously puts these back into the land market, there need not be an inflation of real estate prices. In that case, the rise in the costs and rents of houses would be limited.

12.35 While making provision for urban development schemes due attention should be paid to the needs of the minority concentration areas and their development in the context of their socio-cultural milieu.

12.36 As pointed out earlier, municipal bodies are not able to play their due part in providing the needed services to urban dwellers and in developing urban infrastructure commensurate with the growth of urban population. They are politically, administratively, and financially in a week condition. The restoration of health to local bodies is the pre-requisite for the efficient management of our towns and cities. At the first stage the aim should be to provide to all citizens the minimum of essential services. All obligatory functions should be reverted to municipal authorities. The strategy for urban development would include a package of measures to strengthen the capability of local bodies comprising the restroration of popular Government (except in states where abnormal conditions exist), structural reforms, improvement in general and financial administration and reform of the tax system. While the State Governments have to shoulder the major responsibility for putting through these measures, the Central Government as well as autonomous institutions at the Central level should actively participate in developing programmes of revitalisation and reform. In particular, the Central Government should extend aid to a selected number of institutions for promoting research in the area of urban administration, urban finances, and the planning of the development of urban infrastructure, and to strengthen their capability to provide technical assistance in these areas to State level institutions as well as to the local bodies.

12.37 As the problems created by rapid urbanisation are stupendous and have wide-ranging social and political ramifications, there is national concern for checking the deterioration of conditions in our cities and towns. In this context, central participation and assistance in this vital area is justified. For this purpose it is proposed to set up a National Urban Infrastructure Development Finance Corporation with an initial Plan provision of Rs. 55 crores— Rs. 35 crores in the Urban Development Sector and Rs. 20 crores in the Water Supply and Sanitation Sector.

12.38 In the Seventh Plan 1985-90 emphasis is placed on the following major programmes: (a) The Environmental Improvement of Slums (EIS) programme has to be continued with greater vigour and   steps should be taken to provide security of tenure to the slum dwellers so that they may develop a stake in   maintaining and improving their habitat. Of the total urban population, nearly a fifth is estimated to "   constitute the slum population. The Sixth Plan had estimated that in 1985 the magnitude of such   population needing attention would be about 33.1 million. Of this, upto March 1985, about 15.6 million   slum dwellers would have been benefited, leaving a balance of 17.5 million people yet to be provided   relief. Per capita assistance which was only Rs. 120 in 1972 has been stepped up from time to time   and the present rate of Rs. 250 was fixed in 1984. Since many State Government considered this quantum   inadequate it has been decided to step up the per capita expenditure to Rs. 300. The total outlay for   EIS in State Plans works out to Rs. 269.55 crores for the Seventh Plan. On the basis of a per   capita expenditure of Rs. 300, this order of total outlay would-benefit about 9 million slum dwellers   during the Seventh Plan.

(b) In order to ensure a balanced distribution of urban population and to slow down the growth of metropolises, a centrally sponsored scheme of Integrated Development of Small and Medium Towns (IDSMT) was introduced during the Sixth Plan to provide infrastucture and other facilities in these towns. The Sixth Plan made a provision of Rs. 96 crores in the Central sector with a matching provision in the States' sector for the development of about 200 towns. During the Plan period, Central releases amounted to about Rs. 61 crores in respect of 235 towns. It is proposed to continue this scheme during the Seventh Plan with a Central provision of Rs. 88 crores. During the Sixth Plan the scheme was applicable to small and medium towns having a population of less than one lakh. It is now proposed to extend the coverage to towns having a population of less than three lakhs. In selecting the towns for assistance under the scheme an additional criterion based on the towns' antiquity, aesthetic character, historic association, etc. requires to be adopted.

(c) The Plan includes a provision of Rs. 930 crores in the States' sector for provision of infrastructure facilities like roads, pavements, minor civic works as well as such amenities as bus sheds, market and shopping complexes and theatres. This provision also includes the States' contribution against the centrally sponsored scheme of IDSMT. A provision of Rs. 317.58 crores is included for the development projects being undertaken in the Calcutta Metropolitan Development Area (CMDA) as part of the externally aided programmes and for the development of State Capital Projects of Gandhi Nagar, Bhopal and Chandigarh.

(d) An outlay of Rs. 35 crores has been included in the Plan of the Ministry of Works and Housing for the development of the National Capital Region (NCR) around Delhi. This will be in addition to the provisions included in the plans of other Central Ministries like Railways, Shipping and Transport, etc. The NCR Plan envisages deconcentration of economic activity from the core of Delhi into regional towns located in Haryana, Rajasthan and Uttar Pradesh. A statutory Planning Board for NCR has been constituted under the Chairmanship of the Minister for Works and Housing and a detailed Plan for Development for NCR is under preparation. (e) In India, the use of development banks to finance development oriented sectors in the national economy has proved to be quite successful. It is proposed to set up an Urban Infrastructure Development Finance Corporation to deal with the emerging urban problems that the country is and will be facing. The Plan provides Rs. 35 crores in the Urban Development Sector and Rs. 20 crores in the Water Supply and sanitation Sector, as initial capital for the Corporation which would augment its resources by raising funds from institutional sources. The proposed Institution would finance the development of urban infrastructure including water supply and sewerage schemes. The National Housing Bank also proposed to be set up in the Seventh Plan and the Urban Infrastructure Finance Corporation would together play an important role in promoting housing and urban development on an adequate scale and on a sound basis.

12.39 In the light of the objectives and strategies envisaged for the sector, the outlays proposed for the Seventh Plan are given in Table 12.5.  

TABLE 12.5  Seventh Plan Outlays on Urban Development (Rs. crores)

WATER SUPPLY AND SANITATION

12.40 With the increasing awareness of the vital importance of the provision of potable water to all citizens in the general move towards social justice, allocation to this sector, particularly to the programme for the provision of potable water supply in rural areas, was increased substantially and also rural water supply was included in the Minimum Needs Programme in the Fifth Year Plan and in the Revised 20-point Programme in the Sixth Plan.

12.41 A massive programme for providing safe drinking water facilities in the rural areas was launched during the Sixth Five Year Plan. The results achieved were truly impressive, as 1.92 lakh villages, out of a total number of 2.31 lakh indentified problem villages, as well as 47,000 other villages were provided water supply during the Sixth Plan. The signiificant step-up in the central assistance for this purpose during the Seventh Plan (Table 12.7) indicates the high priority attached to the provision of the basic amenity of potable water supply to every citizen, especially in the rural areas.

Review of Sixth Plan

12.42 Despite the resource constraint, the Sixth Plan provided for a substantial outlay on water supply and sanitation amounting to Rs. 3,922.02 crores—Rs. 3,307.80 crores in the State sector and Rs. 614.22 crores in the Central sector. Within the sector, high priority was accorded to the provision of drinking water to what were identified as problem villages; for this purpose an outlay of Rs. 2,007.11 crores was provided—Rs. 1,407.11 crores in the State sector (MNP) and Rs. 600 crores in the Central sector. The following criteria were used to identify the problem villages:

a) those which do not have an assured source of drinking water within a reasonable distance of say, 1.6 km;

(b) those in which diseases like cholera, guineaworm,etc. are endemic; and

  c) those where the available water has an excess of salinity, iron, flourides and other toxic elements.

12.43 This programme got further impetus when it was brought under the Revised 20-Point Programme in 1982-83. In 1983 a new Incentive Bonus Scheme was started by the Ministry ot Finance in order to further accelerate thi programme of water supply to problem villages. Unde this Scheme a provision of Rs. 75 crores was made durim 1983-84 and Rs. 50 crores during 1984-85.

12.44 At the time of the formulation of the Sixth Plai the identification of problem villages had not beei completed. With the data then available the Sixth Plan ha< aimed to cover 1.9 lakh villages; when the task o identification was completed, this figure went upto 2.3' lakhs. A massive programme was launched to providf potable water in most of the identified problem villages The results have been impressive. Out of the total of 2.31 lakh villages identified as problem villages 1.92 lakh o such villages and 47,000 other than problem villages are estimated to have been provided with water supply facilities by the end of the Sixth Plan. With this, 54 per cen of the population in rural areas has been covered by Rura Water Supply Schemes by the end of the Sixth Plan. The achievement was made possible by investment on a scale larger than orginally envisaged amounting to Rs. 2,485,3; crores—Rs. 1,566.68 crores in the State sector (MNP;and Rs. 918.65 crores in the Central sector (ARP), including Rs. 116.11 crores under the Incentive Bonus Scheme.

12.45 There was an investment of Rs. 3,977.59 crore;(Rs. 3,053.68 crores in the State sector and Rs. 923.9" crores in the Central sector), during the Sixth Plan unde the Water Supply and Sanitation Sector. The physica achievements at the end of the Sixth Plan are expected t( be as shown in Table 12.6.   TABLE 12.6

SEVENTH PLAN

12.46 As pointed out above, although the major areas of the rural population have been now provided with potable water supply as a result of the massive effort during the Sixth Plan period, there are still a sizeable number of problem villages. During the Seventh Plan, in line with the objective of International Drinking Water Supply and Sanitation Decade (1981-91), the aim would be to provide adequate drinking water facilities for the entire population and to provide sanitation facilities to 80 per cent of the urban population and at least 25 per cent of the rural population. Although the task ahead is of a stupendous magnitude, an earnest endeavour would be made to fulfil the objectives set out in the 31 st UN General Assembly Resolution in regard to the provision of water supply for the total population.

12.47 In view of the constraint of resources, it will not be desirable to go in for expensive or sophisticated water supply and sanitation services. Simple and low-cost methods should be preferred. Also, it must be noted that it will not be possible to introduce a uniform mode of water supply everywhere in a vast country like India. The wide variety of climatic conditions and of the sources of surface and underground water require and should permit the adoption of different types of solutions which are economical and in keeping with local needs and conditions.

12.48 Experience has shown that in a programme of this kind and magnitude reaching out to all the regions and remote corners of the country, community involvement is essential in all stages—formulation, execution and maintenance of water supply schemes. A considerable amount of pilferage and wastage of water could be avoided if local involvement and cooperation in enlisted.

12.49 The burden on the exchequer could be reduced to the extent that the beneficiaries are asked to pay. Water supply is a service to be paid for by the direct beneficiaries. In urban areas in particular there is scope for enhancing water rates; there is also scope for improving the realisation of water charges. The State Governments and local bodies should explore the possibility of raising funds for water supply schemes through suitable levies (capital charges) on the potential beneficiaries. Even in rural areas, while the poorer sections cannot be expected to pay for the water, in many villages through local initiative it is possible to collect a small charge which would cover at least a part of the maintenance expenses.

12.50 It is also important that the State Governments, who are the implementing agencies for water supply and sanitation programmes, should pay attention to the organisational and administrative structures at various levels, in order to utiise the Plan funds more efficiently and productively. The organisational pattern for execution of water supply and sanitation schemes varies not only between different States but also within the State itself in the case of many States. Though many States have now set up Water Supply and Sewerage Boards, in some States different agencies like PHED, panchayati raj, community development department, rural engineering department/RIDP/PWD and CPWD are responsible for the execution of water supply and sanitation schemes. It is necessary to have uniform approach in this regard and as far as possible, the same administrative department should supervise the various aspects of design, execution and maintenance. The monitoring and evaluation systems need to be made more efficient and effective at the Central, State and District levels.

12.51 Keeping in view the overall constraint on resources as well as the other competing demands, the Seventh Plan provides for an outlay of Rs. 6,522.47 crores—Rs. 5,285.64 crores under State/UT sector and Rs. 1,236.83 crores under the Central sector—for the water supply and sanitation programme. This works out to 3.62 per cent of the total Plan outlay of the Seventh Plan. This includes loan assistance from the LIC, as well as the external agencies like World Bank, IDA/Bilateral Agencies. The emphasis is considerably greater in respect of rural water supply and an increased outlay of Rs. 3,454.47 crores has been envisaged for this programme in the Seventh Plan. The details of the outlay under this sector are given in Table 12.7.

Rural Water Supply and Sanitation

12.52 As in the Sixth Plan, the rural water supply continues to be a part of the Minimum Needs Programme as well as the revised 20-Point Programme during the Seventh Plan. However, in order to achieve the maximum coverage of rural population during the Seventh Plan, the scope of rural water supply under MNP needs to be extended to all villages, whereas it was restricted to identified problem villages until the end of the Sixth Plan. It may be noticed that, during the Sixth Plan period, there has been a quantum jump in investment in this Sector, especially with regard to the provision of rural water supply. The priority given to this programme is clearly seen from the fact that the Central Government has given a big helping hand to the State Governments in providing the problem villages with water supply by progressively increasing the central assistance under the Accelerated Rural Water Supply Programme (ARP). The amount under ARP and incentive schemes given to the states for the implementation of rural water supply programme in the Sixth Plan amounted to Rs. 918.65 crores and during the Seventh Plan, it is likely to be about 1.5 times that amount.

12.53 Some of the policy issues with regard to the rural water supply programme in the Seventh Plan are as follows:—

(i) Whether a re-definition of the problem villages or problem areas is required for the Seventh Plan and if so, what should be the new definition?

TABLE 12.7  Seventh Plan Outlay—Water Supply and Sanitation

Outalys of Rs. 75 crores and Rs. 50 crores were provided during 1983-84 and 1984-85 respectively, subsequent to Sixth Plan finalisation under Incentive Bonus Scheme.

* Includes an outlay of Rs. 12 crores for prevention and control of water and air pollution which has now been transferred to Science and Technology sector.

** Includes expenditure of Rs. 3.04 crores for prevention and control of water and air pollution during 1980-81 and 1981-82.

(ii) What should be the per capita norm for water supply for rural areas?

(iii) Difficulties which are peculiar to certain areas such as Rajasthan, Haryana and hilly areas and methods of tackling such difficulties.

(iv) Delegation of powers for giving technical approval to State Chief Engineers—extent of delegation.

(v) Making available adequate funds for the maintenance of completed schemes and assets created.

12.54 In view of the resources constraint, the coverage of villages with water supply schemes during the Seventh Plan will have to follow a certain order of Priority. The spill over of identified problem villages (39,000) based on the existing criteria will in any case have to be covered before other villages can be taken up. The next priority will have to be given to those villages which have been identified as problem villages subsequent to 1st April, 1980 on the basis of the existing criteria. Once this task is completed and every village is provided with at least one source of water supply, water supply facilities will have to be further expanded in order to provide for adequate water supply to the villagers. This will naturally result in the liberalisation of the present norms and level of satisfaction in the rural areas so far as water supply is concerned.

12.55 Attempts would be made to cover all those villages which do not have an assured source of water supply within a distance of 0.5 km (as against the present norm of 1.6 km) and also to enhance per capita norm for water supply from 40 litres per capita per day (Ipcd) to 70 Ipcd during the Seventh Plan, as recommended by the Estimates Committee.

12.56 It is also essential to ensure that the poorel sections of the society like Scheduled Castes, Schedulec Tribes and landless agricultural labourers have equa access to this facility. In this context, the location of the source/water collection points is important. This calls foi greater attention to the matter of selection of location- o the sources/water collection points. Where necessary additional sources/water collection points for enabling th( poor to obtain access to safe drinking water should b< separately provided if access to the community source;provided under the general scheme for drinking wate supply to village is difficult for them.

12.57 A new policy is also being evolved in the Seventh Plan to tackle special problems of water supph which are peculiar to certain States Rajasthan Haryan;and Madhya Pradesh) and to hilly areas. The problems o such States and areas will receive special attention in th( Seventh Plan. Administrative bottlenecks in the executiol of schemes will be removed by delegation of power to thi State chief engineers.

12.58 While impressive results have been achieved in providing water supply facilities in the rural areas in the Sixth Plan, the maintenance of these facilities, mostly the handpumps, has been badly neglected, partly because of lack of adequate funds for maintenance and partly because of the lack of suitable machinery for their maintenance. It has been realised that the assets created for provision of water supply in the rural areas at huge cost cannot be allowed to go waste or even become partially defunct. For the first time, therefore, a maximum of 10 per cent of the Plan funds under MNP is being earmarked for the maintenance of the water supply systems in rural areas. The State Governments are also being advised to create a suitable machinery for the regular maintenance of the water supply schemes in rural areas by actively encouraging community participation in this vital programme.

Sanitation

12.59 Lack of a good sanitation system is one of the factor affecting the quality of life of the rural population. Because of resource constraint, considerable backlog in the provision of sanitation facilities in rural areas has arisen. Less than 1 per cent of the rural population, as indicated in Table 12.6 is reported to have been covered by sanitation system at the end of the Sixth Plan. This programme is yet to gather momentum. It is possible to start and implement the programme only with people's participation. Much more can be done in this area through self-help schemes organised by the village community and large-scale mobilisation of voluntary effort at the village level through attempts of the State Governments and local bodies. Simple low-cost design of pour flush latrines have already been developed in many areas through UNDP assistance. It is estimated that each individual sanitary toilet would cost about Rs. 100 per head. Extensive efforts would, however, need to be made on a large-scale to assist the village organisations in the adoption and use of these designs with such local modifications as may be necessary.

Urban Water Supply and Sanitation

12.60 The Sixth Plan document had noted that "while the pressing need of providing adequate water supply and sewerage facilities in the larger cities, especially in the high density areas populated by the low income groups and economically weaker sections, must continue to receive priority, greater attention needs to be given in the Sixth Five Year Plan to the needs of smaller and medium size towns which have been englected in the past" (p. 400). Unfortunately, during the Sixth Plan also, the water supply needs of the smaller and medium towns continued to suffer because of the constraint of resources and the emphasis on provision of water in the rural areas. Although the constraint of resources still continues, it is felt that the needs of the smaller and medium size towns with regard to water supply and sanitation facilities can no longer be ignored. Therefore, augmentation and improvement of water supply facilities in the urban areas, especially in medium and smaller towns, will also have to be attempted during the Seventh Plan to the extent possible.

12.61 According to the available information, about 115.48 million people in urban areas (77.8 per cent of urban population) had been provided with water supply facilities at the end of March, 1981. It is expected that the coverage would have been 133.91 million (81.1 percent of urban population) by the end of the Sixth Plan. Although the average coverage in the country is above 81 per cent, it is below 50 per cent in certain States. The above figures also do not reflect properly either the inadequacy of the water supplied or the deprivation of the urban poor. The urban poor,-due to their low paying capacity and also due to the peculiar conditions governing their settlement patterns, are generally deprived of adequate water and sanitation facilities. Water and sanitation, therefore, has been accorded a high priority in the programme of Environmental Improvement of Slums. The high rate of incidence of death and disease in urban poor settlements can be attributed largely to the poor quality of water and sanitation facilities.

12.62 As regards sanitation, reports indicate that by the end of Sixth Plan only 57.27 million (33 per cent of the urban population) pelple could be provided with sanitation facilities. In view of the huge backlog and the severe overall resource constraint as well as the poor financial condition of the local bodies, it is necessary for the smaller towns other than Class-l cities to adopt cheaper methods of sanitation. Several feasbility studies have been carried out in the area of low-cost sanitation technology in urban areas with the UNDP assistance. These techniques should prove useful in achieving the maximum coverage possible. Central assistance is provided to the low-cost sanitation schemes under the Centrally sponsored scheme of Integrated Development of Small and Medium Towns. Following the recommendation of the conference of State Ministers held in New Delhi in January 1983, that additional resources for the programme be mobilised, HUDCO has agreed to finance 50 per cent of the cost of the low-cost latrines projects.

Central Sector

12.63 Water supply and sewerage are the principal infrastructure facilities having a direct bearing on the quality of life of the urban people. The provision of these facilities in urban areas is highly capital-intensive and has a fairly long gestation period. At present, the capital expenditure of local bodies is met mainly from Plan funds. However, Plan funds are limited in magnitude. Hence even dynamic local bodies which have the capacity to undertake new projects are seriously constrained in their efforts to improve services. To overcome this situation, as already indicated, it is proposed to set up a National Urban Infrastructure Development Finance Corporation.

12.64 In order to give a boost to the low-cost sanitation schemes in the rural areas, a specific provision of Rs. 4 crores has been made.

12.65 For monitoring and development of management information system, a provision of Rs. 1 crore has been included for strengthening and expanding the existing monitoring cells. In view of the large magnitude of work to be done in the areas of water supply and sanitation to fulfil the Plan objectives, a considerable amount of research is called for. The fields which need to be explored in particular are testing of improved simple and effective treatment methods including desalination, re-use of backwash water and more effective methods of low-cost sanitation in rocky and other difficult hydrogeological formations. The Plan, therefore, makes a provision of Rs. 6 crores for this purpose.

12.66 A new scheme to involve the voluntary agencies to implement Plan programme thereby enlisting community participation in the execution and maintenance of water supply schemes in the rural areas is being introduced in the Seventh Plan, for which a provision of Rs. 2.5 crores has been made.

12.67 The Table 12.8 gives the scheme-wise Central Sector outlays for the Seventh Plan. TABLE 12.8 Seventh Plan Outlay on Water Supply and Sanitation-Central Sector (Rs. crores)

*  The provision for this scheme was made during the Sixth Plan in 1984-85. ** Includes expenditure of Rs. 3.04 crores for Prevention and Control of Water and Air Pollution during 1980-81   and 1981-82.

HOUSING

12.1 In fulfilling the basic needs of the population, housing ranks next only to food and clothing in importance. A certain minimum standard of housing is essential for healthy and civilised existence. The development of housing, therefore, must enjoy high priority in a poor society such as ours where housing amenities are far below the minimum standards that have been internationally accepted. Housing activity serves to fulfill many of the fundamental objectives of the Plan: providing shelter, raising the quality of life particularly of the poorer sections of the population; creating conditions which are conducive to the achievements of crucial objectives in terms of health, sanitation and education; creating substantial additional employment and dispersed economic activity;improving urban-rural and inter-personal equity through the narrowing down of difference in standards of living and last but not least, generating additional voluntary savings.

12.2 The National Buildings Organisation (NBO) have estimated that the housing shortage in 1981 was around 21 million dwelling units (16 million in rural areas and 5 million in urban areas); the shortage at the begining of the Seventh Five Year Plan has been placed at24.7 million units (18.8 million in rural areas and 5.9 million in urban areas)¹.

12.3 The above estimates of backlog of housing shortage are only rough. But apart from the existing backlog in housing, the increase in population between 1985 and 1990 would generate roughly an additional requirement of housing units to the extent of 16.2 million, of which 12.4 million will be in rural areas and 3.8 million in urban areas. This means that even if the aim is only to prevent an increase in the magnitude of backlog in housing shortage, it would be necessary to build during the Seventh Plan period around 16.2 million dwelling units. This fact makes evident the gigantic magnitude of the housing problem. This problem cannot be tackled in a meaningful way, if housing activities are left to follow the past pattern of slow and unsystematic growth. There is need for radical orientation of all policies relating to housing. The most important among these are: the provision of finance for house construction on a large scale, development of suitable land sites in urban areas, provision of house sites in rural areas, developing and applying low-cost technology in house construction an policies relating to rent control.

12.4 While all sectors of the economy—the Govern ment sector, public enterprise sector, the private corpo rate sector, the co-operative sector and the householi sector—would have to participate in housing activities in , coordinated manner, the major responsibility for housi construction would have to be left to the private sector, ii particular the household sector. Building houses accord ing to the differing preferences and requirements o different households and economy in house constructior can become possible only if the home owner himsel participates or becomes responsible for house construction. What has inhibited large scale house construction b} households is the inadequate provision of institutiona finance for the housing sector so far. Two major desiderata for a quantum jump in house construction in urban anc semi-urban areas are the mobilisation of resources for the housing sector through the establishment of a proper se1 of institutions and the development of suitable housing sites on a large scale. The poorer sections of the society, however, would need subsidisation and also assistance in house construction from the public sector. In this context, the public sector's role shouldbe three-fold. First, largely promotional, to initiate steps to mobilise resources for the housing sector on an adequate scale; second to continue the efforts to provide subsidised housing to segments of the rural poor and to other economically weaker sections (EWS) of the community like slum dwellers and dock and plantation workers; and third to undertake land acquisition and development in urban areas and providing house sites in rural areas. Housing authorities and Housing Boards should concentrate on the last activity instead of going in for direct construction of houses. The second activity would be performed mainly by the Housing and Urban Development Corporation (HUDCO) for the poorer sections of the society. For other sections this would be performed through a network of house financing institutions with an apex bank for re-finance.

12.5 Public sector Plan expenditure on housing during the Sixth Plan is estimated at Rs. 1,839 crores; in addition, public enterprises are estimated to have spent around Rs. 275 crores on housing. Thus the total expenditure on 1. The extent of shortage has been worked out in terms of certain minimum standards; therefore it should not be assumed that an equivalent number of families are entirely shelterless. Nevertheless, the figures fairly reflect the great inadequacy of housing in the country. housing through agencies of the public sector amounted to Rs. 2,114 crores during the Sixth Plan period. The physical achievements have been reported in Table 12.1

  TABLE 12.1   Physical Achievements during the   Sixth Plan (1980-85) 

12.6 The major part of investment in housing is undertaken by the private sector. Reliable data on investment in private housing are not available. According to the estimates made by the Central Statistical Organisation (CSO), gross fixed capital formation in residential buildings in the private sector, including public sector undertakings, amounted to Rs. 3,054 crores in 1980-81. Assuming that the share of the public sector undertakings in this was of the order of Rs. 70-80 crores, gross capital formation in housing in the private sector would have been around Rs. 2,980 crores in that year. According to CSO figures, private sector investment in housing between 1974-75 and 1979-80 increased by about 62 per cent, or at about 12 per cent per annum. A 10 per cent growth rate could be assumed for the Sixth Plan period.

12.7 On this basis, the private sector investment in housing during the Sixth Plan would have amounted to Rs. 18,000 crores. A growth rate in private sector housing in the Seventh Plan period equal to that assumed for the Sixth Plan period would imply an investment of around Rs. 29,000 crores. In fact, if the backlog in housing is to be reduced to any significant extent by the end of the Seventh Plan, a much larger investment than Rs. 29,000 crores would be called for. This underlines the need for a major effort to mobilise resources for housing and for the Government to take other steps needed, such as to make available developed land on the required scale on the one hand and to make the necessary policy changes to remove obstacles in the way of housing activity, e.g., modification in the rent control laws, on the other.

12.8 The time has now come for the Government to set before itself a clear goal in the field of housing and launch a major housing effort: not so much to build but to promote housing activity through the supply of fiscal and financial infrastructure such that every family will be provided with adequate shelter within a definite time horizon. As far as possible, the public sector should not assume direct house construction except in the case of the weaker sections of the society. This is not to minimise the role of the Government. As stated earlier, the Government has to play an active role through developing the necessary delivery system in the form of a housing finance market and taking steps to make developed land available at right places and at reasonable prices.

12.9 The most crucial need for housing development at the present time is the establishment of a proper and diversified institutional structure for housing finance and construction. The strengthening of the existing institutions like Housing and Urban Development Corporation (HUD-CO) and the creation of new institutions like housing co-operatives and building societies would be necessary. The expansion of the Housing Development Finance Corporation (HDFC) type of activities could also be considered. While HUDCO would concentrate on the provision of subsidised finance to the poorer sections of the society, the HDFC would continue to cater to the clientele coming largely from fairly well-to-do sections of the society. The vast majority of house-seeking individuals and families would have to be looked after through the creation of local level housing finance societies. These societies would raise deposits from the public, mainly from the would-be house owners, and thus stimulate private saving. In addition, they should have access to funds from the capital market through the intermediation of different financial institutions. For this purpose it would be desirable to set up a specialised housing finance institution. In course of time steps should also be taken to develop a secondary mortgage market in housing.

12.10 The apex housing finance institution should be able to draw funds from the capital market as well as from financial institutions. Commercial banks should be permitted to participate on a larger scale than hitherto in housing finance activities.

12.11 As stated above, the public sector has to concentrate on the provision of houses to the poorer sections of the society. HUDCO, in conjunction with the State Governments, would continue to play an important role in the provision of finance to these sections for house-building activity. In addition, the public sector has to play an important role in the provision of housing sites in the rural areas. There is urgent need to adopt low-cost housing techniques, particularly for mass housing schemes for low income groups. Use of alternative building materials like lime, mortar, surkhi, secondary species of timber, etc. in place of traditional building materials like cement, steel, bricks and primary species of timber should be widely adopted.

12.12 Prefabricated technology which has been adopted in some western countries requires to be considered for large scale adoption in our country provided the cost factor is favourable for its adoption. The relative advantages of factory production of prefabricated components of Indian Standards Institution (ISI) standards (like beams and blocks, roofing materials and doors and windows) vis-a-vis traditional building methods, may be assessed. If any fiscal measures stand in the way of adopting large-scale prefab, technology because of its being based on factory production, ways and means may have to be explored to overcome this handicap.

12.13 Direct subsidy to urban housing should be avoided as far as possible. Where direct subsidies are absolutely unavoidable, they should be small and be in the form of insfrastructure facilities so as not to create large differences between the market values and the subsidised prices.

12.14 Against this background, the Seventh Five Year Plan (1985-90) has the following objectives: (i) Promotion and encouragement of self-help housing;

(ii) Provision of house sites to the balance of rural families identified so far and assistance for construction of dwellings for those rural families already provided house-sites;

(iii) Cost of housing units under the social housing schemes should be such that they are within the paying capacity of the targetted groups, like Economically Weaker Sections (EWS), Low Income Group (LIG) and Middle Income Group (MIG);

(iv) Providing stimulus and support for private housing especially for the middle and lower income groups so as to channel increased savings into housing. This will have to be accompanied by steps needed for reducing the cost of urban land;

(v) Securing reduction in construction costs not only by adopting low-cost housing techniques and standards but also modifications in building bye-laws, land use control, minimum plot requirements, etc.; and

(vi) Harnessing science and technology efforts for improving building technology and development of cheap and local building materials.

The progammes for achieving these objectives are as follows:

Rural Housing

12.15 The Minimum Needs Programme (MNP) and the 20-Point Programme give a high priority to the rural house-site-cum-house construction scheme. It is estimated that there were 12.2 million landless families as of March 1985. As against this, the number of families provided house-sites is estimated at 13.07 million. The "excess" achievement is due to the fact that in some states the scheme was extended to smaller municipalities, and in some states the beneficiaries included some belonging to the upper income strata of the rural community. However, state-wise analysis reveals that still 0.72 million landless families among the total estimated landless families of 12.2 million require to be provided with house-sites. It is felt that before extending the coverage of the scheme to smaller municipalities and to those belonging to the upper income brackets of the rural community, efforts should be made to provide construction assistance to those families already provided house-sites according to the original criteria of the scheme. The Sixth Plan envisaged provision of construction assistance to 3.6 million families; in fact only 1.9 million families could be assisted.

12.16 Even though the Sixth Plan envisaged a modest level of Governmental assistance under the scheme, many State Governments were providing substantially higher levels of assistance. In order to make the operation of the scheme more realistic, it is proposed to provide assistance to the extent of Rs. 500 per family for provision of developed house-sites of 90 sq.m. each and assistance of Rs. 2,000 per family towards construction cost. All labour inputs will have to be provided by the beneficiary. The Seventh Plan includes a provision of Rs. 577 crores for this programme. Of this, Rs. 36 crores would be utilised to provide house-sites in respect of those states where there are landless families still to be provided house-sites and Rs. 541 crores would be utilised for the provision of construction assistance to 2.71 million families. Needless to say that if the above targets are to be achieved during the Plan, the State Governments will have to adhere to the norms and standards envisaged in the Plan. These have been considerably liberalised compared to the Sixth Plan.

12.17 On account of the resource constraint, only a limited provision is made in this regard in the State Plans. Besides this, HUDCO has been providing funds for rural housing. This would continue. A specified proportion of General Insurance Corporation (GIC) funds are also earmarked for rural housing. Taken together, the funds for rural housing from public institutions (HUDCO and GIC) would roughly amount to Rs. 240 crores during the Seventh Plan.

Urban Housing

12.18 As already stated, Government's role in the field of urban housing has per force to be promotional. The major effort will have to come from the private sector, Government's role will have to be restricted to the improvement of slums, direct provision of housing to the weaker sections of the society and encouragement and support of housing finance institutions that promote Table 12.3 Seventh Plan Outlays on Housing   (Rs.crores)

@ Included in 2 above. URBAN DEVELOPMENT 12.25 The Sixth Plan recognised that although the share of urban population of India was small, estimated to be only a little over 20 per cent of the population of the country, the absolute size of about 107 million people living in urban areas in 1971 was large by any standards. The urban growth registered in 1971 -81 has followed the pattern of growth in the previous decade. As a per centage of total population, the increase has been from 20.22 per cent to 23.73 per cent. In absolute terms it has meant an increase in urban population from 107 million in 1971 to 156* million in 1981 (provisional). Certain important aspects of this increase require to be noted. While the growth of urban population as a whole was 3.86 per cent, Class I cities grew by 4.6 per cent and Class II cities by 4.2 per cent. The number of towns increased from 2581 in an increasing proportion and area of urban conglomerations are being turned into slums.

  TABLE 12.4 Distribution of Urban Population among Different size Classes of Towns

Notes:—1. The latest data available from the Registrar General's Office place urban population at 160 million. The break-up of this by size classes of towns is, however, not available. 2. Figures in brackets are for 1971.

12.28 In view of the extremely serious situation in which the urban bodies find themselves, a vigorous multi-pronged attack is needed to reverse the trend and to restore conditions of healthy growth. The following may be identified as the major constituents of a comprehensive plan for urban development:

(a) the planned and integrated development of small and medium towns and cities along with slowing down of the growth of big metropolises;

(b) revitalisation of civic bodies;

(c) thorough-going reforms of municipal tax systems and municipal administration in general;

(d) concentration on the improvement of slums and the provision of basic municipal services; and

(e) for this purpose to work out schemes of regular devolution of funds from State Governments and to establish the necessary institutional framework for channeling capital funds for the improvement of urban infrastructure.

12.29 A thorough re-examination of the procedures currently used in the planning of metropolitan areas and the evolution of approaches and methods more suited to the new imperatives arising from the intensification of urban growth all over the country are called for.

12.30 Urbanisation is a phenomenon which is part and parcel of economic development in general. Certain activities are best performed in, indeed require, agglomeration of people. Planning of urban development should essentially be supportive of the economic development in the country, state or sub-region, be it in agriculture, extractive industry, manufacturing industry or in the tertiary sector. The provision of urban services such as transport, communication, water, sanitation and shelter alone is usually unlikely to stimulate large-scale urban development. It is important to time investments in urban services and shelter to coincide with investments in agriculture and industry, mining and commerce which provide sources of permanent employment. Therefore, a proper urban development approach must consist of two constituents. The first is the interaction between physical and investment planning and the second is the preparation of regional and sub-regional urban development plans to make the first possible. Industrial location policy must be made to subserve regional and urban planning. During the Seventh Plan a concerted effort should be made to channelise private industrial investment in the vicinity of small and medium towns so that migration of population is diverted to these from going to the metropolises. The same principal should be applied to public sector investment.

12.31 Regional urban systems can be identified according to their economic, climatic, geographical and transportation characteristics. Planning for urban development can be done on the basis of such regions and according to the relative need and function of each town in its regional context. Thus, within each planning zone allocation to towns should be made more on the basis of their functions with particular emphasis on their respective industrial and employment potential than on their sizes.

12.32 Within towns and cities there is a much greater need for community participation and for more private initiative and investment in urban development than existing at present. The delivery of basic public services to everyone is simply not feasible without such an approach. Slum improvement, sanitation, garbage removal, etc. can be organised and even paid for at the community level. Resources for urban development are very limited and will continue to be so in the foreseeable future given the existence of wide-spread rural poverty and lack of basic services in rural areas. This would call for better allocation of existing funds and mobilisation of additional funds by the municipal bodies themselves. A realistic assessment of needs for basic infrastructure and services is, therefore, a pre-requisite for efficient and effective planning. 12.33 The planning for metropolitan development should provide for:

(i) coordination of city level investment plans with higher (State and Central) level planning and resources allocation exercises;

  (ii) coordination of city level investment plans with resource availability and with physical planning;and   (iii) the fostering of a close relationship between the norms and standards used in physical planning with the   socio-economic realities prevailing within our cities. More explicitly the needs of the poor must   be taken account of more specifically in all physical planning exercises.

12.34 In the small towns and the new centres, the strategy should be to purchase lands in concentric circles, at short notice, before land values begin to rise, quickly providing the infrastructure facilities within a period of 2 to 3 years and then selling the land to the public and private sectors. In this way, the public authority could make two major gains: (i) the profit from site development and (ii) the gains through passage of time. The gains could be used for various purposes. If the public authority makes non-speculative purchases continuously, withdraws land for short periods and continuously puts these back into the land market, there need not be an inflation of real estate prices. In that case, the rise in the costs and rents of houses would be limited.

12.35 While making provision for urban development schemes due attention should be paid to the needs of the minority concentration areas and their development in the context of their socio-cultural milieu.

12.36 As pointed out earlier, municipal bodies are not able to play their due part in providing the needed services to urban dwellers and in developing urban infrastructure commensurate with the growth of urban population. They are politically, administratively, and financially in a week condition. The restoration of health to local bodies is the pre-requisite for the efficient management of our towns and cities. At the first stage the aim should be to provide to all citizens the minimum of essential services. All obligatory functions should be reverted to municipal authorities. The strategy for urban development would include a package of measures to strengthen the capability of local bodies comprising the restroration of popular Government (except in states where abnormal conditions exist), structural reforms, improvement in general and financial administration and reform of the tax system. While the State Governments have to shoulder the major responsibility for putting through these measures, the Central Government as well as autonomous institutions at the Central level should actively participate in developing programmes of revitalisation and reform. In particular, the Central Government should extend aid to a selected number of institutions for promoting research in the area of urban administration, urban finances, and the planning of the development of urban infrastructure, and to strengthen their capability to provide technical assistance in these areas to State level institutions as well as to the local bodies.

12.37 As the problems created by rapid urbanisation are stupendous and have wide-ranging social and political ramifications, there is national concern for checking the deterioration of conditions in our cities and towns. In this context, central participation and assistance in this vital area is justified. For this purpose it is proposed to set up a National Urban Infrastructure Development Finance Corporation with an initial Plan provision of Rs. 55 crores— Rs. 35 crores in the Urban Development Sector and Rs. 20 crores in the Water Supply and Sanitation Sector.

12.38 In the Seventh Plan 1985-90 emphasis is placed on the following major programmes: (a) The Environmental Improvement of Slums (EIS) programme has to be continued with greater vigour and   steps should be taken to provide security of tenure to the slum dwellers so that they may develop a stake in   maintaining and improving their habitat. Of the total urban population, nearly a fifth is estimated to "   constitute the slum population. The Sixth Plan had estimated that in 1985 the magnitude of such   population needing attention would be about 33.1 million. Of this, upto March 1985, about 15.6 million   slum dwellers would have been benefited, leaving a balance of 17.5 million people yet to be provided   relief. Per capita assistance which was only Rs. 120 in 1972 has been stepped up from time to time   and the present rate of Rs. 250 was fixed in 1984. Since many State Government considered this quantum   inadequate it has been decided to step up the per capita expenditure to Rs. 300. The total outlay for   EIS in State Plans works out to Rs. 269.55 crores for the Seventh Plan. On the basis of a per   capita expenditure of Rs. 300, this order of total outlay would-benefit about 9 million slum dwellers   during the Seventh Plan.

(b) In order to ensure a balanced distribution of urban population and to slow down the growth of metropolises, a centrally sponsored scheme of Integrated Development of Small and Medium Towns (IDSMT) was introduced during the Sixth Plan to provide infrastucture and other facilities in these towns. The Sixth Plan made a provision of Rs. 96 crores in the Central sector with a matching provision in the States' sector for the development of about 200 towns. During the Plan period, Central releases amounted to about Rs. 61 crores in respect of 235 towns. It is proposed to continue this scheme during the Seventh Plan with a Central provision of Rs. 88 crores. During the Sixth Plan the scheme was applicable to small and medium towns having a population of less than one lakh. It is now proposed to extend the coverage to towns having a population of less than three lakhs. In selecting the towns for assistance under the scheme an additional criterion based on the towns' antiquity, aesthetic character, historic association, etc. requires to be adopted.

(c) The Plan includes a provision of Rs. 930 crores in the States' sector for provision of infrastructure facilities like roads, pavements, minor civic works as well as such amenities as bus sheds, market and shopping complexes and theatres. This provision also includes the States' contribution against the centrally sponsored scheme of IDSMT. A provision of Rs. 317.58 crores is included for the development projects being undertaken in the Calcutta Metropolitan Development Area (CMDA) as part of the externally aided programmes and for the development of State Capital Projects of Gandhi Nagar, Bhopal and Chandigarh.

(d) An outlay of Rs. 35 crores has been included in the Plan of the Ministry of Works and Housing for the development of the National Capital Region (NCR) around Delhi. This will be in addition to the provisions included in the plans of other Central Ministries like Railways, Shipping and Transport, etc. The NCR Plan envisages deconcentration of economic activity from the core of Delhi into regional towns located in Haryana, Rajasthan and Uttar Pradesh. A statutory Planning Board for NCR has been constituted under the Chairmanship of the Minister for Works and Housing and a detailed Plan for Development for NCR is under preparation. (e) In India, the use of development banks to finance development oriented sectors in the national economy has proved to be quite successful. It is proposed to set up an Urban Infrastructure Development Finance Corporation to deal with the emerging urban problems that the country is and will be facing. The Plan provides Rs. 35 crores in the Urban Development Sector and Rs. 20 crores in the Water Supply and sanitation Sector, as initial capital for the Corporation which would augment its resources by raising funds from institutional sources. The proposed Institution would finance the development of urban infrastructure including water supply and sewerage schemes. The National Housing Bank also proposed to be set up in the Seventh Plan and the Urban Infrastructure Finance Corporation would together play an important role in promoting housing and urban development on an adequate scale and on a sound basis.

12.39 In the light of the objectives and strategies envisaged for the sector, the outlays proposed for the Seventh Plan are given in Table 12.5.   TABLE 12.5  Seventh Plan Outlays on Urban Development   (Rs. crores)

WATER SUPPLY AND SANITATION

12.40 With the increasing awareness of the vital importance of the provision of potable water to all citizens in the general move towards social justice, allocation to this sector, particularly to the programme for the provision of potable water supply in rural areas, was increased substantially and also rural water supply was included in the Minimum Needs Programme in the Fifth Year Plan and in the Revised 20-point Programme in the Sixth Plan.

12.41 A massive programme for providing safe drinking water facilities in the rural areas was launched during the Sixth Five Year Plan. The results achieved were truly impressive, as 1.92 lakh villages, out of a total number of 2.31 lakh indentified problem villages, as well as 47,000 other villages were provided water supply during the Sixth Plan. The signiificant step-up in the central assistance for this purpose during the Seventh Plan (Table 12.7) indicates the high priority attached to the provision of the basic amenity of potable water supply to every citizen, especially in the rural areas.

Review of Sixth Plan

12.42 Despite the resource constraint, the Sixth Plan provided for a substantial outlay on water supply and sanitation amounting to Rs. 3,922.02 crores—Rs. 3,307.80 crores in the State sector and Rs. 614.22 crores in the Central sector. Within the sector, high priority was accorded to the provision of drinking water to what were identified as problem villages; for this purpose an outlay of Rs. 2,007.11 crores was provided—Rs. 1,407.11 crores in the State sector (MNP) and Rs. 600 crores in the Central sector. The following criteria were used to identify the problem villages:

a) those which do not have an assured source of drinking water within a reasonable distance of say, 1.6 km;

(b) those in which diseases like cholera, guineaworm,etc. are endemic; and

  c) those where the available water has an excess of salinity, iron, flourides and other toxic elements.

12.43 This programme got further impetus when it was brought under the Revised 20-Point Programme in 1982-83. In 1983 a new Incentive Bonus Scheme was started by the Ministry ot Finance in order to further accelerate thi programme of water supply to problem villages. Unde this Scheme a provision of Rs. 75 crores was made durim 1983-84 and Rs. 50 crores during 1984-85.

12.44 At the time of the formulation of the Sixth Plai the identification of problem villages had not beei completed. With the data then available the Sixth Plan ha< aimed to cover 1.9 lakh villages; when the task o identification was completed, this figure went upto 2.3' lakhs. A massive programme was launched to providf potable water in most of the identified problem villages The results have been impressive. Out of the total of 2.31 lakh villages identified as problem villages 1.92 lakh o such villages and 47,000 other than problem villages are estimated to have been provided with water supply facilities by the end of the Sixth Plan. With this, 54 per cen of the population in rural areas has been covered by Rura Water Supply Schemes by the end of the Sixth Plan. The achievement was made possible by investment on a scale larger than orginally envisaged amounting to Rs. 2,485,3; crores—Rs. 1,566.68 crores in the State sector (MNP;and Rs. 918.65 crores in the Central sector (ARP), including Rs. 116.11 crores under the Incentive Bonus Scheme.

12.45 There was an investment of Rs. 3,977.59 crore;(Rs. 3,053.68 crores in the State sector and Rs. 923.9" crores in the Central sector), during the Sixth Plan unde the Water Supply and Sanitation Sector. The physica achievements at the end of the Sixth Plan are expected t( be as shown in Table 12.6.   TABLE 12.6

SEVENTH PLAN

12.46 As pointed out above, although the major areas of the rural population have been now provided with potable water supply as a result of the massive effort during the Sixth Plan period, there are still a sizeable number of problem villages. During the Seventh Plan, in line with the objective of International Drinking Water Supply and Sanitation Decade (1981-91), the aim would be to provide adequate drinking water facilities for the entire population and to provide sanitation facilities to 80 per cent of the urban population and at least 25 per cent of the rural population. Although the task ahead is of a stupendous magnitude, an earnest endeavour would be made to fulfil the objectives set out in the 31 st UN General Assembly Resolution in regard to the provision of water supply for the total population.

12.47 In view of the constraint of resources, it will not be desirable to go in for expensive or sophisticated water supply and sanitation services. Simple and low-cost methods should be preferred. Also, it must be noted that it will not be possible to introduce a uniform mode of water supply everywhere in a vast country like India. The wide variety of climatic conditions and of the sources of surface and underground water require and should permit the adoption of different types of solutions which are economical and in keeping with local needs and conditions.

12.48 Experience has shown that in a programme of this kind and magnitude reaching out to all the regions and remote corners of the country, community involvement is essential in all stages—formulation, execution and maintenance of water supply schemes. A considerable amount of pilferage and wastage of water could be avoided if local involvement and cooperation in enlisted.

12.49 The burden on the exchequer could be reduced to the extent that the beneficiaries are asked to pay. Water supply is a service to be paid for by the direct beneficiaries. In urban areas in particular there is scope for enhancing water rates; there is also scope for improving the realisation of water charges. The State Governments and local bodies should explore the possibility of raising funds for water supply schemes through suitable levies (capital charges) on the potential beneficiaries. Even in rural areas, while the poorer sections cannot be expected to pay for the water, in many villages through local initiative it is possible to collect a small charge which would cover at least a part of the maintenance expenses.

12.50 It is also important that the State Governments, who are the implementing agencies for water supply and sanitation programmes, should pay attention to the organisational and administrative structures at various levels, in order to utiise the Plan funds more efficiently and productively. The organisational pattern for execution of water supply and sanitation schemes varies not only between different States but also within the State itself in the case of many States. Though many States have now set up Water Supply and Sewerage Boards, in some States different agencies like PHED, panchayati raj, community development department, rural engineering department/RIDP/PWD and CPWD are responsible for the execution of water supply and sanitation schemes. It is necessary to have uniform approach in this regard and as far as possible, the same administrative department should supervise the various aspects of design, execution and maintenance. The monitoring and evaluation systems need to be made more efficient and effective at the Central, State and District levels.

12.51 Keeping in view the overall constraint on resources as well as the other competing demands, the Seventh Plan provides for an outlay of Rs. 6,522.47 crores—Rs. 5,285.64 crores under State/UT sector and Rs. 1,236.83 crores under the Central sector—for the water supply and sanitation programme. This works out to 3.62 per cent of the total Plan outlay of the Seventh Plan. This includes loan assistance from the LIC, as well as the external agencies like World Bank, IDA/Bilateral Agencies. The emphasis is considerably greater in respect of rural water supply and an increased outlay of Rs. 3,454.47 crores has been envisaged for this programme in the Seventh Plan. The details of the outlay under this sector are given in Table 12.7.

Rural Water Supply and Sanitation

12.52 As in the Sixth Plan, the rural water supply continues to be a part of the Minimum Needs Programme as well as the revised 20-Point Programme during the Seventh Plan. However, in order to achieve the maximum coverage of rural population during the Seventh Plan, the scope of rural water supply under MNP needs to be extended to all villages, whereas it was restricted to identified problem villages until the end of the Sixth Plan. It may be noticed that, during the Sixth Plan period, there has been a quantum jump in investment in this Sector, especially with regard to the provision of rural water supply. The priority given to this programme is clearly seen from the fact that the Central Government has given a big helping hand to the State Governments in providing the problem villages with water supply by progressively increasing the central assistance under the Accelerated Rural Water Supply Programme (ARP). The amount under ARP and incentive schemes given to the states for the implementation of rural water supply programme in the Sixth Plan amounted to Rs. 918.65 crores and during the Seventh Plan, it is likely to be about 1.5 times that amount.

12.53 Some of the policy issues with regard to the rural water supply programme in the Seventh Plan are as follows:—

(i) Whether a re-definition of the problem villages or problem areas is required for the Seventh Plan and if so, what should be the new definition?

TABLE 12.7  Seventh Plan Outlay—Water Supply and Sanitation

Outalys of Rs. 75 crores and Rs. 50 crores were provided during 1983-84 and 1984-85 respectively, subsequent to Sixth Plan finalisation under Incentive Bonus Scheme.

* Includes an outlay of Rs. 12 crores for prevention and control of water and air pollution which has now been transferred to Science and Technology sector.

** Includes expenditure of Rs. 3.04 crores for prevention and control of water and air pollution during 1980-81 and 1981-82.

(ii) What should be the per capita norm for water supply for rural areas?

(iii) Difficulties which are peculiar to certain areas such as Rajasthan, Haryana and hilly areas and methods of tackling such difficulties.

(iv) Delegation of powers for giving technical approval to State Chief Engineers—extent of delegation.

(v) Making available adequate funds for the maintenance of completed schemes and assets created.

12.54 In view of the resources constraint, the coverage of villages with water supply schemes during the Seventh Plan will have to follow a certain order of Priority. The spill over of identified problem villages (39,000) based on the existing criteria will in any case have to be covered before other villages can be taken up. The next priority will have to be given to those villages which have been identified as problem villages subsequent to 1st April, 1980 on the basis of the existing criteria. Once this task is completed and every village is provided with at least one source of water supply, water supply facilities will have to be further expanded in order to provide for adequate water supply to the villagers. This will naturally result in the liberalisation of the present norms and level of satisfaction in the rural areas so far as water supply is concerned.

12.55 Attempts would be made to cover all those villages which do not have an assured source of water supply within a distance of 0.5 km (as against the present norm of 1.6 km) and also to enhance per capita norm for water supply from 40 litres per capita per day (Ipcd) to 70 Ipcd during the Seventh Plan, as recommended by the Estimates Committee.

12.56 It is also essential to ensure that the poorel sections of the society like Scheduled Castes, Schedulec Tribes and landless agricultural labourers have equa access to this facility. In this context, the location of the source/water collection points is important. This calls foi greater attention to the matter of selection of location- o the sources/water collection points. Where necessary additional sources/water collection points for enabling th( poor to obtain access to safe drinking water should b< separately provided if access to the community source;provided under the general scheme for drinking wate supply to village is difficult for them.

12.57 A new policy is also being evolved in the Seventh Plan to tackle special problems of water supph which are peculiar to certain States Rajasthan Haryan;and Madhya Pradesh) and to hilly areas. The problems o such States and areas will receive special attention in th( Seventh Plan. Administrative bottlenecks in the executiol of schemes will be removed by delegation of power to thi State chief engineers.

12.58 While impressive results have been achieved in providing water supply facilities in the rural areas in the Sixth Plan, the maintenance of these facilities, mostly the handpumps, has been badly neglected, partly because of lack of adequate funds for maintenance and partly because of the lack of suitable machinery for their maintenance. It has been realised that the assets created for provision of water supply in the rural areas at huge cost cannot be allowed to go waste or even become partially defunct. For the first time, therefore, a maximum of 10 per cent of the Plan funds under MNP is being earmarked for the maintenance of the water supply systems in rural areas. The State Governments are also being advised to create a suitable machinery for the regular maintenance of the water supply schemes in rural areas by actively encouraging community participation in this vital programme.

Sanitation

12.59 Lack of a good sanitation system is one of the factor affecting the quality of life of the rural population. Because of resource constraint, considerable backlog in the provision of sanitation facilities in rural areas has arisen. Less than 1 per cent of the rural population, as indicated in Table 12.6 is reported to have been covered by sanitation system at the end of the Sixth Plan. This programme is yet to gather momentum. It is possible to start and implement the programme only with people's participation. Much more can be done in this area through self-help schemes organised by the village community and large-scale mobilisation of voluntary effort at the village level through attempts of the State Governments and local bodies. Simple low-cost design of pour flush latrines have already been developed in many areas through UNDP assistance. It is estimated that each individual sanitary toilet would cost about Rs. 100 per head. Extensive efforts would, however, need to be made on a large-scale to assist the village organisations in the adoption and use of these designs with such local modifications as may be necessary.

Urban Water Supply and Sanitation

12.60 The Sixth Plan document had noted that "while the pressing need of providing adequate water supply and sewerage facilities in the larger cities, especially in the high density areas populated by the low income groups and economically weaker sections, must continue to receive priority, greater attention needs to be given in the Sixth Five Year Plan to the needs of smaller and medium size towns which have been englected in the past" (p. 400). Unfortunately, during the Sixth Plan also, the water supply needs of the smaller and medium towns continued to suffer because of the constraint of resources and the emphasis on provision of water in the rural areas. Although the constraint of resources still continues, it is felt that the needs of the smaller and medium size towns with regard to water supply and sanitation facilities can no longer be ignored. Therefore, augmentation and improvement of water supply facilities in the urban areas, especially in medium and smaller towns, will also have to be attempted during the Seventh Plan to the extent possible.

12.61 According to the available information, about 115.48 million people in urban areas (77.8 per cent of urban population) had been provided with water supply facilities at the end of March, 1981. It is expected that the coverage would have been 133.91 million (81.1 percent of urban population) by the end of the Sixth Plan. Although the average coverage in the country is above 81 per cent, it is below 50 per cent in certain States. The above figures also do not reflect properly either the inadequacy of the water supplied or the deprivation of the urban poor. The urban poor,-due to their low paying capacity and also due to the peculiar conditions governing their settlement patterns, are generally deprived of adequate water and sanitation facilities. Water and sanitation, therefore, has been accorded a high priority in the programme of Environmental Improvement of Slums. The high rate of incidence of death and disease in urban poor settlements can be attributed largely to the poor quality of water and sanitation facilities.

12.62 As regards sanitation, reports indicate that by the end of Sixth Plan only 57.27 million (33 per cent of the urban population) pelple could be provided with sanitation facilities. In view of the huge backlog and the severe overall resource constraint as well as the poor financial condition of the local bodies, it is necessary for the smaller towns other than Class-l cities to adopt cheaper methods of sanitation. Several feasbility studies have been carried out in the area of low-cost sanitation technology in urban areas with the UNDP assistance. These techniques should prove useful in achieving the maximum coverage possible. Central assistance is provided to the low-cost sanitation schemes under the Centrally sponsored scheme of Integrated Development of Small and Medium Towns. Following the recommendation of the conference of State Ministers held in New Delhi in January 1983, that additional resources for the programme be mobilised, HUDCO has agreed to finance 50 per cent of the cost of the low-cost latrines projects.

Central Sector

12.63 Water supply and sewerage are the principal infrastructure facilities having a direct bearing on the quality of life of the urban people. The provision of these facilities in urban areas is highly capital-intensive and has a fairly long gestation period. At present, the capital expenditure of local bodies is met mainly from Plan funds. However, Plan funds are limited in magnitude. Hence even dynamic local bodies which have the capacity to undertake new projects are seriously constrained in their efforts to improve services. To overcome this situation, as already indicated, it is proposed to set up a National Urban Infrastructure Development Finance Corporation.

12.64 In order to give a boost to the low-cost sanitation schemes in the rural areas, a specific provision of Rs. 4 crores has been made.

12.65 For monitoring and development of management information system, a provision of Rs. 1 crore has been included for strengthening and expanding the existing monitoring cells. In view of the large magnitude of work to be done in the areas of water supply and sanitation to fulfil the Plan objectives, a considerable amount of research is called for. The fields which need to be explored in particular are testing of improved simple and effective treatment methods including desalination, re-use of backwash water and more effective methods of low-cost sanitation in rocky and other difficult hydrogeological formations. The Plan, therefore, makes a provision of Rs. 6 crores for this purpose.

12.66 A new scheme to involve the voluntary agencies to implement Plan programme thereby enlisting community participation in the execution and maintenance of water supply schemes in the rural areas is being introduced in the Seventh Plan, for which a provision of Rs. 2.5 crores has been made.

12.67 The Table 12.8 gives the scheme-wise Central Sector outlays for the Seventh Plan. TABLE 12.8 Seventh Plan Outlay on Water Supply and Sanitation-Central Sector (Rs. crores)

*  The provision for this scheme was made during the Sixth Plan in 1984-85. ** Includes expenditure of Rs. 3.04 crores for Prevention and Control of Water and Air Pollution during 1980-81   and 1981-82.