BHUBANESWAR: The 16th Finance Commission has commended Odisha’s Rural-Urban Transition Policy, notified in June 2023, saying it can be a starting point for other states interested in putting such a policy in place.
The Commission in its report said Odisha has through this policy adopted a systematic and forward-thinking approach to urbanisation in peri-urban areas, which establishes a clear roadmap for transition of these areas into urban local bodies (ULBs).
The state government has recently created 28 new ULBs. The report said this vision is supported by budgetary allocations and dedicated handholding to bolster local political and bureaucratic capabilities. The policy has created a robust administrative mechanism by employing a hub-and-spoke governance model led by a high-level steering committee, it observed.
“While the State Urban Development Agency is the hub, the district urban development agencies and development authorities are the spokes. This mechanism also ensures citizen engagement and representation from representatives of the ULBs and rural local bodies (RLBs) concerned, alongside the expertise of urban planners, urban designers, development economists, infrastructure experts and IT specialists,” the report stated.
The Commission said the policy outlines specific factors for the selection and ranking of areas for transition, including population, density, contiguity with existing municipalities, revenue mobilisation potential, land structure, employment structure, economic importance and details concerning mobility/transport and infrastructure.
Besides, the policy envisions targeted interventions in urban planning and design, enhancing urban governance capacities and resources, it added.
Stating that the policy has established political representation aligned with urban norms, developing essential infrastructure and institutions and creating effective systems for revenue mobilisation, the report said it underscored the critical importance of a planned and phased transition as the foundation for systematic urbanisation, aiming to prevent the numerous problems associated with haphazard and unrecognised urban growth.
Meanwhile, it has recommended `23,793 crore grant for local bodies during the five-year period from 2026-31. This includes `18,715 crore for RLBs and `5,078 crore for ULBs.