The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, has given the green light to 12 new project proposals under the National Industrial Corridor Development Programme (NICDP).

First reported on major National News Channels 29^th August 2024

The Union Cabinet on Wednesday approved 12 new industrial smart cities in different states with an outlay of Rs 28,602 crore to boost domestic manufacturing, said union minister Ashwini Vaishnaw, while briefing the media on the cabinet decisions. Out of the 12 industrial cities, two are coming up in Andhra Pradesh and one in Bihar.

The Indian government’s decision to approve the establishment of 12 industrial smart cities with an investment of ₹28,602 crore is likely to have several significant benefits for the Indian economy. These benefits can be summarized as follows:

1. Economic Growth and Job Creation

• Industrial Development: The creation of smart cities with a focus on industrial growth will attract domestic and foreign investments, leading to the establishment of new industries and the expansion of existing ones.
• Job Creation: The development of industrial hubs will generate a large number of jobs in various sectors, including manufacturing, services, construction, and technology. This will help reduce unemployment and contribute to the overall economic development of the regions.

2. Infrastructure Development

• Improved Infrastructure: The investment will lead to the development of world-class infrastructure, including roads, transportation networks, power supply, water resources, and waste management systems. This will improve the overall quality of life in these regions and make them attractive to businesses.
• Smart Technology Integration: These cities will integrate smart technologies in areas such as transportation, communication, energy management, and public services, leading to more efficient and sustainable urban management.

3. Regional Development

• Balanced Regional Growth: The establishment of these smart cities across different regions will promote balanced regional development, reducing the economic disparity between urban and rural areas. It will help in the growth of Tier 2 and Tier 3 cities, contributing to a more equitable distribution of economic resources.
• Urbanization: This initiative will help manage urbanization by developing new urban centers, thereby reducing the pressure on existing cities and improving the overall urban ecosystem.

4. Boost to Manufacturing and Exports

• Strengthening Manufacturing: The smart cities are likely to focus on enhancing the manufacturing sector, which is a key component of the ‘Make in India’ initiative. This will boost the country’s manufacturing capabilities, leading to an increase in production and exports.
• Global Competitiveness: With advanced infrastructure and technology, these industrial smart cities will make Indian products more competitive in the global market, potentially leading to an increase in exports.

5. Innovation and Technology

• Innovation Hubs: These cities are expected to serve as innovation hubs where new technologies, particularly in automation, artificial intelligence, and smart systems, can be developed and deployed.
• Skill Development: With the focus on technology and industry, there will be a push for skill development programs that can equip the workforce with the necessary skills to work in these new industrial environments.

6. Environmental Sustainability

• Sustainable Development: The smart cities will incorporate environmentally sustainable practices, including green buildings, renewable energy sources, and efficient waste management systems. This will contribute to reducing the environmental impact of industrialization.

7. Foreign Direct Investment (FDI)

• Attracting FDI: The creation of world-class industrial smart cities will make India an attractive destination for foreign investors, leading to an increase in FDI, which can further stimulate economic growth.

8. Support to Ancillary Industries

• Development of Ancillary Industries: The growth of large industries in these smart cities will lead to the development of ancillary industries, including small and medium enterprises (SMEs), thereby creating a more diversified industrial base.

9. Boost to Real Estate and Housing

• Real Estate Growth: The development of these cities will lead to a boom in the real estate sector, with increased demand for commercial, industrial, and residential properties.
• Affordable Housing: The government’s focus on developing these smart cities might also include affordable housing projects, contributing to housing solutions for the growing population.

Overall, the government’s approval for setting up 12 industrial smart cities with a substantial investment is expected to significantly contribute to India’s economic growth, industrial development, and regional balance, while also promoting sustainability and innovation.