India’s Smart Cities Presents U.S. with a Unique Opportunity

During his January 2015 visit to New Delhi, President Obama and Prime Minister Modi announced the decision to elevate the U.S.-India Strategic Dialogue to a Strategic and Commercial Dialogue (S&CD). The expanded dialogue was created to reflect our two countries’ shared commitment to strengthen the bilateral commercial and economic partnership.

Given the importance of our relationship with India, it was imperative to better position the United States as one of India’s principal commercial partners by aligning U.S. commercial capabilities with the Government of India’s key priorities. A dedicated track within the S&CD focuses on infrastructure and smart cities. Through this work stream, the Commerce Department is taking a leadership role in partnering with India to develop smart cities and urban infrastructure, including the use of renewable energy and upgraded transportation. 

In terms of purchasing power, India is the third largest economy in the world. With approximately 1.28 billion people, which is more than a sixth of the world's population, India has the second most populous country in the world, and is estimated to add another 500 million people to its urban population over the next 40 years.

India’s government has almost overwhelmingly focused on economic development and, as a result, has proposed a nationwide program to build 100 smart cities. A smart city is a city equipped with basic infrastructure to provide a decent quality of life, and a clean and sustainable environment through the application of some smart solutions. Monitoring water quality, treatment of wastewater, smart meters, renewable sources of energy, efficient green building and intelligent traffic management systems are some of the solutions of a smart city. For India, this means a wide variety of major infrastructure projects across the country will be funded by the central and state governments, as well as private sector capital, over the next few years. India’s infrastructure needs are estimated to be in the $1.5 to $2 trillion range.

To spur smart city activity across India, the Government of India has partnered with Bloomberg Philanthropies to select 100 smart cities that will receive central government funding to be matched by the private sector. In recognition of cutting-edge U.S. technologies, products and services, the Government of India invited U.S. industry, in concert with the U.S. government, to take the lead in developing three Smart Cities in India: Ajmer in the state of Rajasthan; Allahabad in the state of Uttar Pradesh; and Vishakhapatnam (Vizag) in the state of Andhra Pradesh. The Bloomberg Smart City Challenge Competition released the 20 cities that will receive the first funding. Of the three U.S. industry-led smart cities, Vizag is included in the first group of 20.

With the support of the U.S. Trade and Development Agency (USTDA), U.S. companies will be involved in planning and providing technical assistance for each of these cities. Vizag is moving forward with a Master Planning grant issued by USTDA to be implemented by a three company consortium led by AECOM. However, U.S. participation is not limited to these three cities. Commercial Service (CS) India, in partnership with the American Chamber of Commerce and other local commercial chambers, have been staging events across India in cities with additional public and private smart city projects.

All this presents a tremendous opportunity for U.S. companies to assist India’s government to make its 100 smart city and green development goals a reality. In fact, earlier this month, Deputy Secretary of Commerce Bruce Andrews led a delegation of 18 U.S. companies on a Smart Cities Infrastructure Business Development Mission to India. Representatives from the Infrastructure industry joined the mission that was designed to connect them with opportunities in green infrastructure development, while introducing Indian policymakers, businesses and urban planners to the world-class services offered by the mission participants.

During keynote remarks at the third Smart Cities Summit in Mumbai, Deputy Secretary Andrews said that though the presence of the mission delegates underscores America’s commitment to the U.S.-India relationship, the full potential of that relationship will not be realized without solving the lingering challenge of India’s business climate.

“We want to be partners – because India's success is critical to the future of both the global economy and the world's fight to address climate change,” said Deputy Secretary Andrews. “Working together, we can help India not only build the foundation for a sustainable, green future – but, in the process, show the world how to create truly 21^st century cities.”