How a city lives in India, run only by private corporations

    09 Oct 2021

    Welcome to Gurgaon, a city with a population of 1.5 million without a citywide water and electricity system or even sewerage. Let’s get acquainted with Hmarochos’ narrative about it.


    What would a city look like without a municipality run only by private corporations? For an answer, take a look at Gurgaon in India.

    Gurgaon is located 30 km from New Delhi, the capital of India. It is one of the fastest-growing cities in the country and the third in terms of per capita income. Gurgaon is home to almost half of Fortune 500 companies, including American Express, General Electric, Motorola, Dell, Microsoft, IBM, and Google.

    How did it turn out?

    It all started with a man named Sanjay Gandhi, who dreamed of an Indian-made car – the nation’s pride. In the 1970s, the government wanted to focus on public transport, but Sanjay was the son of the Prime Minister of India, so his dream was quickly realized. The then small village of Gurgaon near Delhi was chosen to build the car plant. The land here was much cheaper, and almost none of the investors were interested.

    The Indian car Maruti turned out to be a failure, but later the plant and the car brand were bought by Suzuki. Things went well, and in the 1980s, the plant already employed 20,000 residents of Gurgaon.

    There was only one field around the city, owned by one man, the Minister of State of Haryana, where Gurgaon is located. This played a significant role in the subsequent events because India is a very bureaucratic and corrupt country, for any construction will have to pay a considerable reward to everyone in the long chain of negotiations and decision-making. However, things were easier with the land around Gurgaon. In the early 1990s, a decision was made to simplify Haryana’s bureaucratic system, and the state minister quickly began building the city on his land.

    Soon, Nestle, Coca-Cola, Dell, American Express, and others built their plants and offices here. They chose Gurgaon because of the lack of bureaucracy, its location close to Delhi and the international airport, and cheap labor. Along with corporations, a wave of skilled workers, educated youth, and the “creative class” came to the city.

    Delhi was already old, crowded, and dirty, and in Gurgaon, developers were building luxury mansions, high-rises with shared pools, clubhouses, and shopping malls.

    The reverse side of urban anarchy

    In fact, Gurgaon was a city that grew and developed rapidly, but legally it did not exist. There was no municipality.

    In addition to the great benefits for developers, the bureaucratic emptiness has created unique problems: who should be responsible for health care, electricity and water supply, sewerage, cleaning, and everything else we are used to receiving from the state in exchange for our taxes?

    With no alternative, the developers took over all the functions of the municipalities. In Gurgaon, private companies service sewerage, water and electricity, security, and more. At first glance, the business has managed to provide services (to those who pay for them), but only at first glance.

    A single sewer system connects only a third of the city. Imagine a luxury residential complex that is not connected to the sewer.

    The solution was found: developers immediately sold some houses with a mini-plant for wastewater treatment. These plants still have waste, so they are simply taken out and dumped into the Yamuna River.

    Other houses without mini-plants collect sewage in septic tanks and take it to state-owned treatment plants or drain it outside the city. Similar to garbage: the private service traditionally dumps waste outside private areas.

    Only a third of the population has access to water. The rest buy water in private wells.

    Groundwater is quickly depleted and polluted (because garbage and sewage poison them). The lack of water is compensated by private companies that send water carriers to Gurgaon.

    Only two-thirds of the electricity comes from a large coal-fired power plant nearby. Private companies compensate lack and constant interruptions. Many houses are not connected to large distribution networks, so they generate electricity with the help of diesel generators (and they pollute the environment) – they are equipped with almost all apartment buildings.

    Law enforcement is almost entirely the work of private companies (35,000 private security guards against 4,000 police officers). Crime and homicide rates in Gurgaon are higher than in Delhi and neighboring Faridabad. Gurgaon’s resident companies hire private security services to accompany their employees.

    The private security police have areas beyond which they have no authority. Between these areas, there are areas that no one protects.

    By 2008, there were only 14 fire engines in Gurgaon, although the government had demanded at least 42 for the city. Moreover, their pumps could extinguish a fire only in a building no more than 40 meters high. But the tallest building in Gurgaon is 300 meters high. Developer companies had no choice but to build their own fire stations, acting as a quasi-state emergency service.

    Gurgaon’s transport infrastructure is primitive. Municipal public transport is almost non-existent, private buses are in short supply. Poor road quality and a massive number of cars lead to constant traffic jams. The good pavement on the roads ends with the boundaries of private property. Traffic police, traffic lights, and road signs are virtually absent. Resident companies hire private buses and taxis for their employees.

    In 2014, the first private metro in the country was built in the city (5.5 km line, development of a branch connecting the city with Delhi).

    Each station is sold at auction and receives a sponsor, after whom it is named.

    For example, you can make an appointment at the Vodafone Belvedere station, which was built by a British telecommunications company. The station looks like a colossal advertising installation.

    Random social experiment

    In 2008, Gurgaon was officially recognized as a city with a population of over 1.5 million. Gurgaon formally received local government, but the infrastructure has already been created without its participation by many fragmented private companies, which are not going to give it up in favor of creating a single system.

    Implementing infrastructure in an already built and populated city is a long and expensive process of negotiating with owners of private homes, offices, and areas that are often opposed to construction (in the West, this phenomenon is called NIMBY – “not in my backyard”).

    The situation has not changed with the advent of the municipality. All he managed to do was rename the city Gurugram, but few even noticed.

    Nevertheless, Gurgaon is considered a prestigious city to live in, medical and not only tourists come here, there are many luxury hotels and more. Within private oases, living here is pleasant, except for polluted air and water, common to all. But outside of these areas, there is virtually no common infrastructure to connect the city together.

    Despite all the shortcomings, the experiment has already been reproduced in the western Indian state of Maharashtra – a private city of Lavasa was built there. It exists without the participation of any municipality. And in 2011, Afghanistan sent a delegation of officials to Gurgaon to study its development model to replicate elements in Kabul.

    The private city model has not yet been tested outside of India, but it has inspired ideas such as Paul Romer’s “charter cities,” where other countries or private companies can fully manage urban settlements in developing countries. It looks like new urban colonialism. In Honduras, where the idea was implemented, courts quickly rejected plans, fearing that the company’s ambitions could undermine the constitution.

    On the example of Gurgaon, we can clearly see which kind of city can generate an uncontrolled free market. You may find similar logic in other countries: building without planning, where each developer sets its own rules indoors and outside of it, no public infrastructure such as green areas, recreational cities, public educational institutions, or clinics.

    Is it a future that we really want to live in?


    Read here our author’s column, describing the possibility of “eco-capitalism” and cities with innovative industries.

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