Asian Development Bank 2010 Report on Indian Cities

The 2010 Asian Development Bank report was prepared after a survey of 27 cities was conducted. The competitiveness factors: people, catalysts, infrastructure and financials were taken into account during the survey. According to the report, Delhi emerged as the most attractive city in the country for both foreign and domestic investors. Delhi’s high quality of life, transportation infrastructure and cost-effective labour both skilled and unskilled contributed in a big way to the city’s economic growth. The infrastructure development as a result of Commonwealth Games 2010 such as the international airport and the Metro rail network are among the major factors contributing to Delhi’s rise to the numero uno position.
The ADB report ranked cities under five major categories - city prosperity index, urban governance, business environment, infrastructure index and quality of life.

City prosperity index- indicates the general affluence of the population, depth of consumer market and income and expenditure characteristics and these parameters affect the need and demand created for residential, retail and hospitality classes.

Urban governance index- shows the ease of doing business in a particular area which, of course, is subject to government regulations and reforms. This particular index measures the speed of policy implementation and quality of administration in a city. A favourable business environment therefore includes parameters like availability of labour, composition of workforce and availability of finance.

Infrastructure index- such as water and power supply, roads, public transport, crime and safety, environmental pollution and recreation and leisure options also influence investment options.

The 2010 ADB report pointed out that location precedes supplier selection in globalisation initiatives- ‘Earlier, countries competed for location but now competition is often at a granular level between various cities.’

Greater Mumbai and Chennai followed Delhi closely as good metropolitan areas for investment.
According to the ADB report, Greater Mumbai’s position remains unchallenged, its infrastructure hoever lagged far behind the pace of economic growth witnessed by the city. Several major infrastructure projects such as the Mumbai Urban Transport project and the Bandra Worli sealink could not influence on potential economic growth.

Chennai was ranked No. 3 potential hub for future investments for reasons such as it being a major seaport, for being hub of manufacturing industries as well as for the recent developments such as an exceptionally high investment of Rs 34000 crore for upgrading its urban infrastructure.
The report named Bangalore as a major economic hub in the country with major IT, biotech and FMCG companies but mentioned that the city’s infrastructure was not been able to keep pace with its rapid economic growth.

Hyderabad, was to reported to be emerging as a top slot city in India. The city also has the highest number of formally approved IT SEZs in the country.
Among tier-two cities, Pune and Ahmedabad topped the list and are expected to experience similar growth trajectories over the next decade.

According to the ADB study, the top 15 cities to invest in India are (per rank): Delhi, Greater Mumbai, Chennai, Bangalore, Hyderabad, Kolkata, Pune, Ahmedabad, Surat, Chandigarh, Nagpur, Visakhapatnam, Vadodara, Jaipur and Thiruvananthapuram.