From Informal to Inclusive Urbanization: Options for Funding the Transformation in India

The contemporary process of urbanization prevalent in the countries of the Global South, especially in Africa and Asia, is characterized by an unprecedented rise in urban populations, exceeding the capacity of local authorities to provide essential services. In particular, local authorities lack the funding required to build adequate infrastructure. One striking feature of contemporary urbanization is the growth in informal urbanized settlements, called “census towns” in India, “urban villages” in China, and “townships” in South Africa. Compared to India, China and South Africa have been able to turn around their cities and revamp them within 10 years. These countries present similarities and differences in managing and providing basic urban services. In this chapter, an attempt is made to analyze and compare the urbanization process in these countries and to identify some financial alternatives and policy implications to foster inclusive growth by integrating informal settlements into mainstream urbanization with focus on India.