The Telegraph
Since 1st March, 1999
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- Disparities among cities signal the growing disparities among regions

The author is director, Rajiv Gandhi Institute for Contemporary Studies, New Delhi

India is a large country. Thatís obvious. There are considerable differences across Indiaís states and regions. Thatís also obvious. Whether these disparities across states or regions have increased (divergence) or decreased (convergence) in the Nineties is an issue often debated. To decide on an answer, one has to evaluate the performance of different states and evaluation is always a function of variables used for ranking. In general, such rankings adopt two different methods. First, questionnaires are administered to respondents and a processing of responses leads to the evaluation. This is a subjective technique. Second, one uses data. This is an objective technique. Sometimes, one tries to splice subjective and objective techniques together. Usually, a bad idea.

With Laveesh Bhandari of Indicus Analytics, I have done this kind of work for the last couple of years. Sometimes, but not always, for the Confederation of Indian Industry. Although questionnaire-based approaches are quite common in cross-country studies, we wanted to avoid this. Apart from other problems, if you want to satisfactorily administer questionnaires to respondents, as a pre-requisite, respondents have to be familiar with functioning in all states or regions. Typically, this is impossible to ensure and it imparts a bias that is impossible to correct. Hence, Laveesh and I preferred to work with objective data.

Our work on states cum regions motivated us to ask whether it was possible to rank Indiaís cities also. While this is an interesting question, you must appreciate that data problems are more difficult for cities. Census or National Sample Survey data are not usually available for cities. For instance, they may be available for districts and a district is not synonymous with a city. The data problem is an especially serious one the moment one gets away from the metros.

Subject to these constraints, we did a study on how Indian cities are doing, from the business point of view. This was done for the CII and results have just been published, although the study was actually completed almost two years ago. What is the definition of a city' We wanted to use the Census 2001 cutoff of 1 million population in urban agglomerations. That gave us 35 cities. But data were often not available for Nashik. Out went Nashik. And despite being below the 1 million cutoff, we wanted to include Goa and Chandigarh. Hence we ranked 36 cities.

What variables did we use for the ranking' Constrained by non-availability of data, we picked six heads or categories we thought were important ó professional education, road transport, communication, private finance, tourism (business and leisure) and growth of the economy. Data are for the end of the Nineties. So this ranking gives a snapshot or cross-section in time. Except the growth category, it doesnít enable you to track a cityís performance over time. However, if you keep repeating this exercise, you will be able to track the temporal performance.

Next for each category, we had to identify variables, making sure we had enough variables for each category. For professional education we used number of students in professional institutes (recognized by the All India Council for Technical Education) and number of institutes. For road transport, we used fuel (high speed diesel and petrol) consumption and four- and two-wheeler populations. For communication, we used telephones (basic and cell) and internet connections. For private finance, we used number of bank accounts and credit extended. For tourism, we used number of good quality hotels, number of good quality restaurants and number of international tourists. (The Restaurant and Hotel Federation of India has a classification of hotels and restaurants.)

For economic growth, we used growth in fuel consumption, growth in credit, growth in number of students and growth in population. Because you are comparing cities that have different sizes, data need to be normalized to render it comparable. We usually did this by dividing by population. We are amenable to the idea of using many more variables, provided you tell us how to get the data. To keep the record straight, we did actually have many more variables. But we dropped them, because they duplicated what was already being captured by the retained variables.

So we now have variables within each category. Aggregate them (using appropriate weights) to figure out how a city is performing within each category. Aggregate across the categories (using appropriate weights) to figure out how a city is performing overall. There arenít major surprises for the metros. But there are quite a few surprises for the non-metros.

Take the six categories one by one. Bangalore is the best in professional education, followed by Pune. Asansol is the worst in professional education, just behind Goa. But 7th, 8th, 9th and 10th are respectively Coimbatore, Nagpur, Jaipur and Lucknow. Calcutta is 11th.

In private finance, Greater Mumbai is the best, followed by Chandigarh. Dhanbad is the worst, just behind Allahabad. But Coimbatore is 3rd, Vadodara is 6th, Ludhiana is 7th, Indore is 8th and Kochi is 10th. While normalization partly explains this, you might not have expected these results. Calcutta is 13th.

In communication, Delhi is the best, followed by Coimbatore. Dhanbad is the worst, behind Asansol. Kochi is 3rd, Chandigarh is 4th, Ludhiana is 5th and so on. Calcutta is 24th.

In road transport, Chandigarh is the best, followed by Amritsar. Calcutta is the worst (36th), behind Greater Mumbai. Again, normalization largely explains this. Rajkot is 3rd, Ludhiana is 4th, Vadodara is 5th and so on.

In tourism, Greater Mumbai is the best, followed by Delhi. Asansol is the worst, behind Dhanbad. Calcutta is 4th. There are no great surprises in the tourism rankings.

In relative growth over time, Calcutta is the best, followed by Faridabad. Jabalpur is the worst, behind Visakhapatnam. Kanpur is 3rd, Surat is 4th, Chandigarh is 5th and so on. Understandably, relative growth has been higher in smaller cities.

Now that we know how the 36 cities have performed in the six individual categories, one needs to aggregate to obtain an overall index. In descending order of performance, the top ten cities are Delhi, Greater Mumbai, Chandigarh, Coimbatore, Bangalore, Chennai, Ludhiana, Pune, Hyderabad and Kochi. Interpreted in a slightly different way, these are cities you would like to live in, because the quality of life is better.

Personally, my surprises are inclusion of Coimbatore, Ludhiana and Kochi in the top 10. But if you think about it, the results arenít that surprising. What about the bottom 10' Again in descending order, the worst cities are Madurai, Visakhapatnam, Agra, Meerut, Varanasi, Patna, Asansol, Jamshedpur, Jabalpur and Dhanbad. No great surprises again, although I must confess I hadnít expected Jamshedpur to be in the bottom 10.

Laveesh and I havenít done such exercises just for the fun of it, although there is indeed an element of fun involved. What concerns us is increased inter-state cum inter-regional disparities in India, and disparities across cities are just one manifestation of this. Arguably, such disparities have increased in importance in the Nineties and there are no easy policy solutions as to how they can be handled.

Relatively backward states donít seem to mend their ways and improve governance. Central dole-outs or migration are unsatisfactory remedies. China had similar disparities, but there the polity is such that it didnít lead to socio-economic tensions. More accurately, state boundaries are administrative entities and donít matter for purposes of relative deprivation.

There is a hole of backwardness and deprivation in central India, extending eastwards and all the way up to the Northeast. Bihar, Jharkhand, Madhya Pradesh, Chhattisgarh, Rajasthan, Uttar Pradesh, Maharashtra, Karnataka, Andhra Pradesh, Orissa, West Bengal, Assam and the North-east all have such backward districts. Notice that it is in these areas that discontent often manifests itself in violence.

Laveesh and I have no easy policy answers. But if our studies (this, as well as the others) lead to such issues being discussed, our purpose will have been served.

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