Key Takeaways
- State governments are working to make Smart City SPVs self-sustainable after the Smart Cities Mission ended.
- SPVs are transitioning from operational roles to consultancy platforms for municipal corporations.
- SPVs in Surat and Agartala are successfully implementing large projects and generating revenue through consultancy fees.
New Delhi: The recent conclusion of the Smart Cities Mission has prompted state governments to ensure the longevity of the special purpose vehicles (SPVs) established under the program. Without further funding from the Centre, these SPVs have shifted their focus to functioning as consultancy platforms for municipal corporations and executing significant urban development initiatives. The pressing challenge for state governments lies in achieving long-term self-sustainability for these SPVs.
Surat’s municipal commissioner, Shalini Agarwal, emphasized the need to maintain the SPV’s relevance, stating, “With the Smart City Mission wrapped up, our top priority is to make SPVs sustainable.” The projects previously managed by the SPV have been transferred to various departments, each containing an operation and maintenance (O&M) clause in its tender.
Having been one of the earliest cities to complete its Smart City projects, Surat has chosen not to dissolve its SPV. The city’s integrated command and control centre (ICCC), pivotal for urban governance, continues to be managed by the SPV. Penalties and fines collected for municipal infractions are directed to the SPV, further solidifying its financial footing.
Similarly, the Agartala Smart City SPV has successfully adapted by implementing large infrastructure projects while also offering consultancy services. CEO SK Yadav remarked, “Our SPV is self-sustaining, as for the last two years we have been implementing big infrastructure projects.” By levying a 3% consultancy charge, Agartala’s SPV has created a consistent revenue stream that supports operational costs. Moreover, the expertise gained through the Smart City Mission has enhanced the SPV’s ability to manage substantial projects.
With a dedicated team of consultants, the Agartala SPV continues to thrive by securing funding from organizations such as the Asian Development Bank (ADB) and the Agence Française de Développement (AFD). Officials from Chennai and Agra are also adopting similar strategies to ensure their SPVs remain operational. Notably, these SPVs maintain a lean administrative structure while adapting to the evolving urban landscape.
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