Integrated approach key to growth of cities, tells Economic Survey 2025-26

According to the 2011 census, India is 31% urban. However, the economic survey suggested that India is far more urban in economic and functional terms, noting consensus on measuring urbanisation using data on mobility, labour markets, density, built-up areas, and night-time light.

The survey also noted India’s urban population has expanded rapidly in absolute terms, with large metropolitan regions such as Mumbai, Delhi, Bengaluru, Chennai, and Hyderabad now ranking among the world’s largest urban agglomerations by population. “However, population scale has not translated into proportionate gains in urban productivity, liveability, or global economic influence.” The survey also mentioned a World Bank estimate that by 2036, India’s towns and cities will be home to 600 million people, 40% of the population, contributing almost 70% to GDP.

Identifying land, housing, mobility, sanitation, and waste management as the “binding constraints” limiting the benefits of urbanisation in India, the survey called for solutions such as scaling city bus fleets and digitising operations to improve service reliability. To address last-mile journeys, it recommends legalising and standardising shared autos, e-rickshaws, minibuses, and bike taxis through simple permits, station pickup bays, and app integration. To unclog the roads, it recommended “targeted congestion pricing” in dense business districts.