10 Key Facts About Smart Cities You Should Know!

Union Urban Development Minister Honb’le Mr. Venkaiah Naidu announced the first list of 20 smart cities at a press conference on Thursday in Delhi.

The cities were chosen on the basis of feasibility, smartness of proposal, performance indicators among others and awarded marks out of 100. The Minister said, ‘Today marks a historic landmark in annals of urban development as we get to know the first batch of 'Smart Cities'.

Referring to the investment opportunities in the backdrop of the recent financial crisis, he said, “People are searching for safe investments. I offer smart cities as the safest investment because land is going to be there, structures are going to be there, so the returns are assured.”

The first 20 smart cities are: Bhubaneshwar, Pune, Jaipur, Surat, Kochi, NDMC (New Delhi), Ahmedabad, Jabalpur, Vizag, Solapur, Devangere, Indore, Coimbatore, Kakinada, Belgaum, Udaipur, Guwahati, Chennai, Ludhiana and Bhopal.

Here are key facts about these Smart Cities that you should know:

Population (20 cities): 3.54 crore

Funding

Central Funding: Rs. 48,000 crore to the Smart City Mission over five years. This comes to on an average Rs. 100 crore per city per year.

State/ULBs Funding: An amount equal to the Central Funding, on a matching basis, will have to be contributed by the State/ULB

Total: Therefore approx Rs. One Lakh Crore of Government/ULB funds will be available for Smart Cities development.

Basic infrastructure/services to be provided:

• Assured water and power supply
• Sanitation
• Solid Waste Management
• Efficient Urban Mobility and Public Transport
• IT connectivity
• e-Governance and citizen participation

First Year and Subsequent Funding: In the first year, Government proposes to give Rs.200 crore to each selected Smart City to create a higher initial corpus. After deducting the Rs. two crore advance (for preparation of Smart City Proposal -SCP)and Admin and Other Expenses share of the MoUD, each selected Smart City will be given Rs. 194 crore out of Rs. 200 crore in the first year followed by Rs. 98 crore out of Rs. 100 crore every year for the next three years

Role of States and Urban local Bodies (ULBs): Key support role envisioned for States and Urban local Bodies (ULBs). It is mentioned that smart leadership and vision at this level and ability to act decisively will be important factors determining the success of the Mission.

Special Purpose Vehicle (SPV): The mission will be implemented at City Level by a Special Purpose Vehicle (SPV) created for the purpose. SPV to plan, appraise, approve, release funds, implement, manage, operate, monitor and evaluate the project.

SPV Governance: SPV to be headed by a CEO, with representation in board from Central & State Govts and ULB.

Distribution of 100 Smart Cities: The total number of 100 Smart Cities has been distributed among the States and UTs on the basis of an equitable criteria. The formula gives equal weightage (50:50) to urban population of the State/UT and the number of statutory towns in the State/UT. Based on this formula, each State/UT will, therefore, have a certain number of potential Smart Cities, with each State/ UT having at least one.

Re-allocation of Smart Cities: The distribution of Smart Cities will be reviewed after two years of the implementation of the Mission. Based on an assessment of the performance of States/ULBs in the Challenge, some re-allocation of the remaining potential Smart Cities among States may be required to be done by MoUD.

Handholding Agencies: During the preparation of the Smart Cities Mission, a number of foreign Governments have offered to provide Technical Assistance (TA) support.

Additionally, other external organizations, including bilateral and multilateral institutions, as well as domestic organizations have suggested to the Ministry of Urban Development that they can give technical assistance support. These include World Bank, ADB, JICA, USTDA, AFD, KfW, DFID, UN Habitat, UNIDO, etc.

Such organizations, which have experience in the field of Smart City development, can also extend support to the States/UTs as hand-holding agencies in preparing the SCPs. The Ministry will assist in tying up the arrangements.

 (Source: Smart City Guidelines, Govt. of India)

Buying A House Overseas Easier Now

Buying a house overseas, which used to be the preserve of the super rich, has now become a lot easier for wealthy Indians with the Reserve Bank of India doubling the foreign exchange remittance limit to $250,000 per individual per year. In other words, a family of four can remit $1 million (equivalent of Rs 6.2 crore) every year to purchase assets overseas.

With this move, the rupee has become almost fully convertible for most Indians. The funds remitted overseas can be used for almost any activity barring a few such as speculation in exchanges, funding terror groups or for remittances to Bhutan,Nepal, Mauritius and Pakistan.

According to Bank of India chairperson V R Iyer, the increase in the liberalized remittance scheme to $2.5 lakh reflects the confidence of the regulator in consistency in foreign inflows.

RBI governor Raghuram Rajan said on Tuesday the foreign currency remittance limit was relaxed following a review of the external sector outlook and as a further exercise in macro prudential management.

The central bank also said that it will ask the government to subsume under this limit various remittances that an individual is allowed under the Foreign Exchange Management Act, which include donations, gift remittances and exchange facilities for those seeking employment overseas and for maintenance of close relatives abroad.

Until now, this facility was in addition to remittance limits already available for private travel, business travel, studies, medical treatment, etc as described in Schedule III of Foreign Exchange Management (Current Account Transactions) Rules, 2000.

An improvement in the country’s foreign exchange reserves has emboldened the RBI to increase the limit. Announcing his policy, Rajan said the following the drop in oil prices the current account deficit has been comfortably financed by net capital inflows, mainly in the form of buoyant portfolio flows and supported by foreign direct investment inflows and external commercial borrowings. “Accordingly, there was accretion to India’s foreign exchange reserves to the tune of $6.8 billion in Q3,” said Rajan. Source: Times of India; 04 Feb, 2015

 

Brigade Group forms $247M JV with Singapore’s GIC for residential realty projects

BY  Swet Sarika

Dutch pension fund APG and Canada’s CPPIB had also struck similar platform deals in the Indian realty space.

Bangalore-based Brigade Group has entered into a Memorandum of Understanding (MoU) with Singapore's sovereign wealth fund GIC to jointly invest up to Rs 1,500 crore ($247 million) in residential developments in select cities of South India, the company said in a stock market disclosure.

The JV aims to acquire land for residential and mixed use developments in cities reporting strong secular demand for high quality residential units.

MR Jaishankar, chairman and managing director, Brigade Group, said, "Our first joint venture project - Brigade Cosmopolis is a well conceived, residential community with several amenities coming up at Whitefield, Bangalore that will be home to over 880 families. This JV will provide us a platform to acquire and execute a series of similar projects in South India."

Lee Kok Sun, managing director and co-head, Asia, GIC Real Estate, said, "As a long term investor, GIC is a believer in India's growth potential. We seek partners who share our philosophy and values and have a reputable track record in the markets in which they operate."

A number of real estate and infrastructure developers have formed alliances with global investors for investment and development of real estate in India. In February this year, Piramal Enterprises Ltd and Canada-based CPPIB Credit Investments Inc joined hands to offer rupee debt financing to residential projects in major urban centres of India. The two partners committed an initial investment of $250 million each for the same.

Recently, it sealed its debut deal from the joint venture where it invested Rs 110 crore in a luxury residential project of Advance India Projects Ltd in Gurgaon.

In March this year, The Xander Group Inc. and an investor consortium led by Dutch pension fund asset manager APG Asset Management NV, announced the creation of a $300 million (Rs 1,800 crore) venture that will buy income generating, institutional grade commercial assets across India’s main office markets.

Two years ago, Godrej Properties forged a residential property development platform with a string of foreign institutional investors led by Dutch pension services provider APG. The platform focuses on developing mid-income residential properties in Mumbai, Delhi-NCR and Bangalore besides looking at opportunities in Pune and Chennai. Godrej Properties is the exclusive developer of the projects and also gets development management fee.

(Edited by Joby Puthuparampil Johnson)

Piramal Fund invests in Lotus Greens’ Noida residential project

BY  Swet Sarika, VCCircle

Piramal’s realty investment unit plans to invest as much as $1 billion towards real estate this fiscal.

Piramal Fund Management, the real estate investment arm of Piramal Group, has invested in a residential project by north-based developer Lotus Greens, two people familiar with the development told VCCircle. The investment has been made in the form of structured debt.

VCCircle could not immediately ascertain the size of the investment but it could be in the same range as its other recent deals.

Piramal recently sealed a deal with Satya Group for a Gurgaon project, where it invested Rs 100 crore. In the first deal from its separate alliance with Canada Pension Plan Investment Board (CPPIB), it invested Rs 110 crore in a luxury residential project of Advance India Projects Ltd in Gurgaon.

The latest investment has been made in a project called Lotus Greens Arena located at sector 79, Noida. This luxury residential project is spread across 10 acres and offers 3 & 4 BHK apartments ranging from 1,495 sq. ft. to 2,395 sq. ft. The project forms a part of developer’s township Sports City.

“The deal was closed recently,” said a source quoted above.

Emails written to Khushru Jijina, managing director, Piramal Fund Management and P Sahel, vice chairman, Lotus Greens, did not elicit any response till the time of filing this story.

Lotus Greens is present across residential, commercial, hospitality, education and healthcare verticals. Founded by Nirmal Singh and led by its vice chairman P Sahel, the company has ongoing projects in Noida and Gurgaon.

As for Piramal, it plans to invest as much as $1 billion towards real estate this fiscal. In the last four months, it has invested Rs 2,000 crore on behalf of proprietary debt book and funds business. In a recent interaction with VCCircle, JIjina said he will be approving between Rs 600-800 crore of transactions every month through the rest of the year.