Smart City programme is intended to improve the quality of our living by merging technology to upgrade the efficiency of social infrastructure of an area. Being the second largest job providing sector in the country, real estate is evaluated to be the major beneficiary of the 100 Smart City mission. Earlier, major real estate activities where constrained to metro cities for better yields. Now as Smart Cities will evenly spread infrastructure, many Tier II cities will emerge as the key realty markets.
According to a report published by The Royal Institution of Chartered Surveyors (RICS), 89 percent of the amount allocated for developing the first 20 Smart Cities is proposed to develop environment, transportation, water, power and sewage management in a particular area. Only a mere figure of 7 percent is provisioned for technology and 4 percent is reserved for enhancing public services. 74 percent is of the expenditure focuses on area based development in the cities rather than city wise development.
As the social infrastructures of the Tier II cities will be developing, the livable friendly quotient also scores high. More industries will flourish to these locations and human resources will migrate more to the city. Coupling with the steady economical forecast, these soon to be turned Smart Cities will gain the impetus to transform much better than the metro cities. The price indexes of these locations are also corrected fairly, providing fillip for real estate activities.
According to the MD of RICS, the report also examines how unique is the Indian Smart Cities model. Instead of a pan city development, the model focuses on area wise development. The total expenditure of the Smart Cities comprises of Centre grant of Rs 20,000 Crores, which accounts for 41 percent of the total money. Around 22 percent is poured through private investments, accounting Rs 10,520 Crores. Central sector schemes, debt and other sources comprise the remaining amount for the mission.