Key Policy Interventions for Urban Development in India

India’s cities are growing at a pace that strains every system we’ve built for them. Roads choke with traffic, housing shortages push millions into informal settlements, and basic services like water and sanitation struggle to keep up with demand. Over the decades, the government has rolled out a series of policy interventions to address these pressures, broadly clustered around three themes: planning, basic services, and poverty alleviation. Each of these areas tells a story of evolving priorities, learning from past mistakes, and the ongoing challenge of building cities that work for everyone.

The foundation: urban planning interventions 🔗

Urban planning is where policy meets the map. Before cities can deliver services or tackle poverty, someone has to decide how land will be used, where roads will run, and which neighbourhoods will house which activities. This is the work of Master Plans and the Development Authorities that create and enforce them.

Master Plans: blueprints for the future city 🔗

A Master Plan is essentially a long-term spatial strategy for a city. It sets out objectives and strategies to manage development and change, defining what is important about a place and how its character can be conserved, improved, and enhanced. Master Plans typically cover a horizon period of around 20 years, which means they are designed to anticipate growth well beyond the immediate term.

The story of Master Plans in India begins in Delhi. The Town Planning Organization was set up in 1955 and completed the formulation of the first Master Plan for Delhi in September 1962. That early exercise became a template for the rest of the country. The first conference of State Ministers dealing with Town and Country Planning in 1960 kicked off a countrywide programme for preparing master plans, enacting town planning legislation, and setting up dedicated planning departments.

Since then, Delhi alone has had three Master Plans – MPD 1962, MPD 2001, and MPD 2021 – with the Delhi Development Authority currently preparing its fourth plan for 2041. Other states have followed similar trajectories, with their own planning acts and master plans for major urban centres.

Development Authorities: the implementing agencies 🔗

Development Authorities are the statutory bodies that actually translate plans into built reality. They handle land acquisition, housing construction, and infrastructure development. Instead of municipal governments or Metropolitan Planning Committees, state government-controlled Development Authorities primarily undertake urban planning in most major cities, preparing master plans that regulate land use every 10 to 20 years.

Well-known examples include the Delhi Development Authority, the Bangalore Development Authority, and the Haryana Urban Development Authority. These bodies have broad mandates – they are responsible for the development and maintenance of residential, industrial, commercial, and institutional areas, along with community infrastructure like schools, hospitals, and community centres.

However, critics point out a structural concern. Development Authorities are bureaucratic agencies with limited accountability to local elected bodies, which creates tension with the decentralising spirit of the 74th Constitutional Amendment. This gap between planning on paper and democratic urban governance remains one of the unresolved puzzles of urban policy.

Delivering basic services: housing, sanitation, and mobility 🔗

Planning sets the stage, but cities actually run on services. Housing, water, sanitation, and transportation are the day-to-day essentials that determine quality of life. Several flagship policies have targeted these fundamentals.

The National Housing Policy and its evolution 🔗

India’s housing policy has evolved through many iterations, from early refugee rehabilitation schemes after Partition to today’s flagship missions. The most consequential recent intervention is the Pradhan Mantri Awas Yojana (Urban), or PMAY-U.

Launched on 25 June 2015, PMAY-U is implemented by the Ministry of Housing and Urban Affairs and provides central assistance to states and UTs for addressing housing needs of slum dwellers and households in the Economically Weaker Sections, Low Income Group, and Middle Income Group categories. The scheme operates through four verticals: in-situ slum redevelopment, credit-linked subsidy, affordable housing in partnership, and beneficiary-led individual house construction.

One of the most notable design choices was empowering women. PMAY-U made a mandatory provision for the female head of the family to be the owner or co-owner of the house under the Mission, a significant break from earlier housing schemes where ownership almost always defaulted to men.

The mission has since evolved. In June 2024, the Union Cabinet approved PMAY-U 2.0 to assist one crore urban poor and middle-class families with construction, purchase, or rental of affordable housing over five years, with government assistance of ₹2.30 lakh crore. This next phase requires states to formulate their own Affordable Housing Policies to promote the broader housing ecosystem.

Urban transportation: the National Urban Transport Policy 🔗

Mobility is another critical front. The National Urban Transport Policy was originally launched in 2006 and revised in 2014 to reflect new realities of traffic congestion, pollution, and the need for multimodal transport systems.

The policy’s core ambition is people-centric. It aims at providing better mobility and sustainability by focussing on people mobility rather than vehicle mobility. This framing matters – it signals a shift away from designing cities around cars and toward designing them around residents.

Its main objectives include integrating land use with transport planning, encouraging public transport and non-motorized modes, introducing intelligent transport systems, addressing road safety, and reducing pollution. The policy also promotes Transit Oriented Development, where public transport systems are woven into the built environment so that homes, jobs, and services cluster around mobility hubs.

Sanitation and urban services 🔗

Sanitation has received dedicated attention through missions like the Swachh Bharat Mission (Urban) and the Atal Mission for Rejuvenation and Urban Transformation (AMRUT). The latter focuses on water supply, sewerage improvement, and other core civic infrastructure in statutory towns. Together with the Smart Cities Mission, these initiatives aim to upgrade the physical and digital infrastructure that makes city life livable.

Urban poverty alleviation: a three-decade journey 🔗

The third pillar of urban policy is tackling poverty directly. Unlike rural poverty, urban poverty has its own distinct character – it is often invisible, concentrated in slums, and entangled with informal labour markets. India’s response has gone through several generations of schemes.

Nehru Rozgar Yojana: the early intervention 🔗

The Nehru Rozgar Yojana (NRY) was the first major centrally sponsored scheme dedicated exclusively to urban poverty. Launched in 1989-90, NRY targeted the urban poor – particularly unemployed youth and women – by providing opportunities for self-employment and wage employment.

The scheme had three main components: the Urban Self-Employment Programme, the Urban Wage Employment Programme, and provisions for Shelter Upgradation and Construction. NRY was funded on a 60:40 basis by the central and state governments and was later merged with SJSRY in December 1997.

Swarna Jayanti Shahari Rozgar Yojana: consolidation 🔗

By the late 1990s, the urban poverty landscape had several overlapping programmes, and consolidation became necessary. The Swarna Jayanti Shahari Rozgar Yojana (SJSRY) was launched on 1 December 1997.

SJSRY subsumed three earlier urban poverty schemes – Nehru Rozgar Yojana, Urban Basic Services for the Poor, and the Prime Minister’s Integrated Urban Poverty Eradication Programme – with the key objective of providing gainful employment to the urban unemployed or underemployed through self-employment ventures or wage employment. Funding was shared between the Centre and the States in a 75:25 ratio.

A distinctive feature of SJSRY was its community-based delivery structure. The scheme worked through urban local bodies and community organizations like Neighbourhood Committees and Community Development Societies, which helped embed the programme in the social fabric of poor neighbourhoods. It also gave special impetus to empowering poor women, with the Development of Women and Children in Urban Areas component offering subsidies of up to 50% of project cost for women-led self-employment groups.

National Urban Livelihoods Mission: the mission-mode approach 🔗

By the early 2010s, policymakers felt that urban poverty required a more ambitious, mission-mode response. The Swarna Jayanti Shahari Rozgar Yojana was replaced by the Deendayal Antyodaya Yojana-National Urban Livelihoods Mission (DAY-NULM) in September 2013.

NULM aims to reduce poverty and vulnerability of urban poor households by enabling them to access gainful self-employment and skilled wage employment opportunities. Its components include social mobilisation and institution development through self-help groups, skill training, self-employment support, support to urban street vendors, and shelters for the urban homeless.

NULM’s design reflects lessons learned from its predecessors. It places strong emphasis on women’s self-help groups as institutional anchors, invests heavily in skill development to match urban labour market needs, and explicitly recognises vulnerable groups like street vendors and the homeless who had been poorly served by earlier schemes.

How the pillars connect 🔗

These three pillars – planning, basic services, and poverty alleviation – are not independent silos. A Master Plan that ignores affordable housing pushes the poor into unauthorised settlements. A housing scheme without transport connectivity strands beneficiaries far from jobs. A livelihood mission without sanitation support leaves families trapped in unhealthy environments.

Recent policy experience shows growing awareness of this interconnection. The Jawaharlal Nehru National Urban Renewal Mission, which ran from 2005 to 2014, attempted to integrate housing, water, sanitation, and infrastructure under a single umbrella. Its successors – AMRUT for infrastructure, PMAY-U for housing, Smart Cities Mission for integrated urban development, and NULM for livelihoods – try to maintain that integrated spirit while allowing each stream to specialise.

Ongoing challenges 🔗

Despite decades of effort, urban policy in India faces persistent gaps. Master plans are frequently delayed or poorly implemented. Development authorities sometimes operate with limited democratic accountability. Housing schemes struggle to reach the poorest quartile, while the credit-linked components tend to favour households with stable incomes. Transport policies often face funding and institutional coordination challenges, with urban transport governed by multiple agencies without a single accountable authority.

The next frontier involves deeper integration with climate goals, stronger municipal finances, genuine decentralisation to urban local bodies, and data-driven planning. As Indian cities hurtle toward an urban population of more than 800 million by 2051, the stakes of getting urban policy right have never been higher.

What do you think? Which of these three pillars – planning, basic services, or poverty alleviation – do you believe deserves the most attention in the next decade of urban policy? And how can development authorities be made more accountable to the residents of the cities they plan?

References

1. https://dda.gov.in/about-master-plan
2. http://tcpo.gov.in/
3. https://casi.sas.upenn.edu/iit/mathewidiculla
4. https://assetzilla.com/authorities/Haryana-Urban-Development-Authority-(HUDA)-7
5. https://pmay-urban.gov.in/about
6. https://pmaymis.gov.in/
7. https://www.pib.gov.in/PressReleasePage.aspx?PRID=2043927
8. https://www.niti.gov.in/sustainable-urban-transport-way-forward
9. https://testbook.com/question-answer/the-nehru-rozgar-yojana-was-implemented-from-_____–67ab29a61f1de259ecd32c25
10. https://cag.gov.in/uploads/old_reports/union/union_performance/2001/2001_book3/chapter3.pdf
11. https://meghalaya.gov.in/sites/default/files/documents/SJSRY_Guidelines.pdf
12. https://testbook.com/question-answer/the-swarna-jayanti-shahari-rozgar-yojana-was-repla–64ecd23f3fc8bce772e2751d
13. https://www.india.gov.in/national-urban-transport-policy