Thursday 9 June 2011

Towards social development zones

Social development zones (SDZs) represent a new approach to creating education and health institutions in the country connecting emerging opportunities in policy. These also address some major constraints that Indian private investment faces today in investing in these two critical sectors of development that directly impact on unlocking human potential. 

These opportunities are presented by the commencement of Rajiv Awas Yojana, a property-rights driven effort at moving towards a slum-free India and increasing interest of both the state in India and Indian capital to invest in higher education, skill development, healthcare and medical education. Collectively, these provide a canvas of reconfiguring select urban locations as social development zones. 

Rajiv Awas Yojana (RAY) announced as a key initiative of the Union government to move towards a slum-free India was cleared by the Cabinet last week. It provides a framework for the government of India support to state governments for upgrading housing and economic and social infrastructure if states legislate to assign property rights to people living in slums, now estimated as 25% of urban population. 

It prefers in situ rehabilitation as against relocation. However, it also provides for property rights and not land rights so that development of socio-economic infrastructure is made possible also by vertical construction, thereby easing a portion of the land from current use as housing stock. This, therefore, provides an opportunity for partnership with the private sector to develop the land that is freed up, provided they partner in the effort to improve housing stock and infrastructure under Rajiv Awas Yojana. 

If we examine sectors of education and health, there is a new interest in Indian capital to invest in education, especially higher education, skill development, hospital care and medical education. One of the biggest problem prospective investors face is shortage of land in cities. Therefore, the carrot that could now be dangled by the state is the offer of urban land in lieu of setting up affordable health and education facilities, thereby "crowding in" social infrastructure in the areas mentioned and make erstwhile slums SDZs and people living there have property rights and improved homes. 

It will require investments in improving housing stock and infrastructure upfront and allays apprehensions that it may be a repeat of experience where land was taken on promises of a certain percentage of free treatment to poor patients and breached in practice. The land should be made available only on the basis of competitive bidding from credible partners interested in education and healthcare. 

The 11th Plan, which set up central universities in remote locations to respond to regional equity, has in several locations been unable to attract faculty because of the absence of basic social infrastructure. This begs the question if students from that area would not have been better off with provision of generous scholarships to be admitted in better-functioning existing institutions. Space requirements prescribed to start an educational facility needs to be re-examined when located in the proposed SDZs. 

After all, global centres of academic excellence such as the Columbia and New York universities in the US or the London School of Economics are located in central locations of New York and London. Similarly, private healthcare and private medical education pracare costly, on account of cost of land, among other factors. 

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