spatial development in India

spatial development in India

Article:

The article discusses the lopsided spatial development across Indian cities.

Analysis:

1. India’s high economic growth in past few years has been characterized by unequal, skewed industrialization and infrastructural development across Indian cities, with clusters of economic activity concentrated in a few highly dense megacities.
2. Unlike in China, Europe and the US, where the engines of growth and job creation have spread to the secondary cities, in India medium-sized cities are crippled with problems of unemployment, poverty and lack of infrastructural development.
3. Determinants of spatial development: Agglomeration economies and Congestion costs

• Spatial development in any location is determined by the trade-offs between the forces of agglomeration economies and congestion costs. Agglomeration economies are the benefits that come when firms and people locate near one another together in cities and industrial clusters.
• Agglomeration economies in the US are concentrated in locations with employment density below 150 employees per sq. km. However, in India, Agglomeration economies is concentrated in location with employment density even more than 1000 employees/ sq.km
• With increased employment density and resultant congestion, there is reduced employment growth. For example: In China, locations with employment density above 150 employees per sq. km have experienced reduced employment growth, indicating important congestion costs

4. Difference in spatial pattern of development of manufacturing and service sector in India
5. a) Manufacturing sector:

• India’s manufacturing sector is spatially spreading at a much faster pace than the services sector and there has been spread in low-density manufacturing districts. However, the manufacturing sector has not spread to all districts.
• The spatial evolution trend in the manufacturing sector in India is similar to the trends found in China and the US. However, speed and pace of spatial spread is much slower in India

b)Service sector:

• High-density service clusters have continued to grow at a much faster pace than less dense areas and more dense locations have become more concentrated over time.
• The spatial evolution trend in service sector is different from that in USA and China. For example: In USA, service sector have tended to grow fastest in medium density locations, such as Silicon Valley.

5. Why is India’s spatial evolution different?

• Though India’s megacities suffer from severe congestion costs, they also benefit from huge agglomeration economies and knowledge spill overs. The service sector has benefitted more from knowledge spillovers compared to the manufacturing sector
• The agglomeration economies has dominated over congestion costs for the service sector.
• Further, the spatial development policy initiatives have failed to develop small and medium cities.

6. Way ahead:

• The Spatial evolution experience of China and the US indicate, India’s engines of growth and job creation will be in small and medium cities and not megacities.
• However, there needs to be emphasis on inclusive spatial development in our development discourse.
• Policymakers need to focus on infrastructural development, improved access to telecommunication, and post-secondary education in secondary cities to develop service sector.