External Sources Of Financing for Urban Development In India

Financing urban development in India has primarily been a domestic affair. However we have looked to external sources for financing and it has financed 10-12% of domestic investment. The assistance we have been receiving From foreign bodies has been steadily increasing over the years. In the past most of the external programs were not directed at the urban area but now with concentration on areas such as environment,health,micro credit and small scale industries they are more urban oriented. Urban India like other urban parts of the world is characterized by a high concentration of population and also concentration of development in a few areas. Urban development has become a major priority in the agenda of international agencies. Several bilateral and multi- lateral agencies still do not have an urban department. This is due to the low priority given to urban affairs. However these international agencies mainly differ in terms of three areas (a) setting priorities (b)identifying projects and partners, (c) Launching projects and monitoring. Most of the above activities mentioned (a) to (c) Tend to take place in the beneficiary countries. The international agencies continue to be diverse in their urban development strategies. The contribution of developed countries to Development Aid seems to be declining in real terms. After the Second World War most of the member countries of OECD(Organization for Economic Co-operation and Development) made a resolution at the United Nations to set aside 0.7 % of the GDP every year as development aid. However it is only the Scandinavian countries that meet this target and none of the other countries. In India’s domestic Economy also inspite of an increasing level of urbanisation most attention is paid to rural perspective has forced the planners to formulate development objectives insuch a way that allocation for the urban sector has remained low.