SHANGHAIZATION OF MUMBAI: VISIONS, DISPLACEMENTS, CONTESTATIONS

BY

RAVI GHADGE

DISSERTATION

Submitted in partial fulfillment of the requirements

for the degree of Doctor of Philosophy in Sociology
in the Graduate College of the
University of Illinois at Urbana-Champaign, 2013

Urbana, Illinois

Doctoral Committee:

Professor Jan Nederveen Pieterse, Chair

Professor David Wilson
Associate Professor Behrooz Ghamari-Tabrizi
Assistant Professor Brian Dill
 ABSTRACT

A central question in the field of global studies is how does the development planning of

emerging economies address social inequality? The emerging economies have achieved

remarkable economic success in recent years; however, this success has also accompanied new

challenges of mega-urbanization, new rural and urban poverty and inequality. This has prompted

a reexamination of the growth strategies in countries such as India and China who have made

“inclusive growth” as their central goal of development planning.

In the context of inclusive growth, urban development has emerged as a key problematic

that seeks to balance high growth and reduction in poverty and inequality. Growth has fueled

national ambitions for increasing power in world politics and the global market and cities are

viewed as key actors in sustaining this growth. In this context, growth gets normalized, masking

its inequities, unevenness, and contestations. Therefore, any serious discussion about inclusive

growth in emerging economies has to take into account the complex urban realities within these

societies and the challenges involved in making growth inclusive.

Taking Mumbai—India’s “global city”—as a case, this dissertation explores competing

claims of urban development among diverse stakeholders in the city (including planners,

business associations, civic organizations, activists, and poor peoples’ movements) in the context

of the recent national growth strategy in India that gives primacy to cities. I analyze the

genealogies of emerging local (urban) development imaginaries, modeled after “successful”

Asian cities, particularly Shanghai. In doing so, I focus on the processes, actors, visions, and

practices that constitute and contest these urbanization strategies. The study was based on twelve

months of field work (archival research, interviews, and ethnographic observation) in Mumbai.

The study contributes in problematizing taken-for-granted assumptions of growth in the

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emerging economies and calls for broad-based inclusive development that focuses on the quality

and welfare implications of growth.

Some of the key findings of the study are:

~Shanghaization as an urban growth strategy was produced and sustained by a constellation of

actors operating at multiple scales involving the corporate sector, the national and subnational

state, and the urban middle classes.

~As a model of development, Shanghaization is narrowly focused on growth rather than broad-

based development. As an entrepreneurial model, it privileges the urban middle-classes and does

not address structural poverty and inequality in the city.

~Shanghaization is not merely a metropolitan imaginary, but has emerged as a national urban-

centric model of development in India that is premised on uneven development.

~By challenging the narrow economic assumptions in development thinking, the poor people’s

movements in the city open up possibilities for ground-up, broad-based developmental

alternatives that are equitable and sustainable.

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To Priyam, for her love, patience, and support &

Rishaan, for the new adventure….

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 TABLE OF CONTENTS

INTRODUCTION……………………………………………………………………..................1

CHAPTER 1: INCLUSIVE GROWTH AND THE URBAN QUESTION...…..…....................23

CHAPTER 2: AN UNEQUAL CITY: THE MAKING OF BOMBAY/MUMBAI…….............50

CHAPTER 3: THE SHANGHAI MODEL OF DEVELOPMENT……………..…….…...........73

CHAPTER 4: SHANGHAIZATION OF MUMBAI:

VISIONS OF A “WORLD CLASS” MUMBAI…….........................................105

CHAPTER 5: TRANSFORMING MUMBAI:

“THE VIOLENCE OF DEVELOPMENT”……………………………............132

CHAPTER 6: WHOSE CITY IS IT? MUMBAI: A CONTESTED CITY.................................150

CONCLUSION………………………………………………………………………...…........187

REFERENCES……………………………………………………………………………........194

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 INTRODUCTION

~“Indian cities will be the locus and engine of economic growth over the next two decades, and
the realization of an ambitious goal of 9—10 per cent growth in GDP depends fundamentally on
making Indian cities much more livable, inclusive, bankable, and competitive.” (Eleventh Five
Year Plan (2007-2012), Planning Commission, Government of India 2008:394).

A central question in the field of global studies is how does the development planning of

emerging economies address social inequality?1 Emerging economies, particularly in Asia, have

achieved spectacular economic success in the last few decades (Harris 2005; Nederveen Pieterse

2008b; Prestowitz 2005).2 For years now, growth rates in the global South (particularly in India

and China) have far exceeded those of the North (Nederveen Pieterse 2008b). There is a

widespread optimism that in this “Global-Asian Era,” the new economic dynamism in Asia, led

by India and China, would alter the international political economy dominated by the

“transatlantic West,” thereby reshaping the world (Kaplinsky and Dessner 2006:197). Sustained

growth in the past few decades has led to significant improvements in living conditions and a

decline in extreme poverty in the world.3 However, this growth has also brought with it

numerous challenges—mega-urbanization, new rural and urban poverty, and inequality—that

threaten to derail the progress of growth and poverty reduction (Commission on Growth and

Development 2008; Davis 2004; 2006; Dicken 2003; Mittleman 2006; Nederveen Pieterse

2008b; 2009; Sassen 1999). For example, in India although there has been a decline in urban

poverty (largely attributed to the increasing rate of urbanization), the absolute number of the

urban poor has increased in recent years. Moreover, the incidence of decline in urban poverty has
1
Some scholars prefer to use the term “emerging societies” to emphasize a sociologically rich understanding of the
internal debates within the emerging economies that focus not only on the economic dynamism, but also the social
and political processes that shape it and are shaped by it (Nederveen Pieterse and Boike Rehbin, 2009b). This study
supports this endeavor.
2
Investment bankers have coined the term BRIC (Brazil, Russia, India, and China) to refer to a special category of
countries which have sustained high growth rates. See Harris (2005) and Prestowitz (2005).
3
However, some scholars are critical of these dominant claims on poverty reduction. For example, see Wade (2004).

1
not accelerated with the GDP growth (Government of India 2009). Therefore, it is imperative to

understand the developmental trajectory of emerging economies. As Nederveen Pieterse (2009b)

puts it:

How the development path of emerging economies relates to social inequality; what is the
relationship between economic vitality in emerging economies and social inequality? Are social
inequality and multi-speed economies built into the pattern of accumulation such that if inequality
recedes accumulation declines, or is the development path geared towards reducing inequality?
Where do the emerging economies lay their growing weight—with growth without equity or
growth with equity? (P. 4)
However, the uneven and unequal nature of growth in emerging economies has not unnoticed

and has recently prompted a reexamination of existing growth policies. As a result of this,

“inclusive growth” has emerged as a new development paradigm in many countries that seeks to

focus not only on the pace, but also on the quality and pattern of growth.4 Recently, countries

such as India and China have made inclusive growth as the center piece of their development

planning (Fewsmith 2004; Planning Commission, Government of India 2006; 2011; State

Council of China 2006).

In planning for inclusive growth, urban development has emerged as a key problematic

that seeks to balance high growth and reduction in poverty and inequality. Cities are extremely

important for growth. As highlighted by the urban studies literature in the West, due to the

agglomerative nature of global capitalism, cities (“world/global cities”) are assuming a more

central role in the world economy (Abu-Lughod 1989; Arrighi 1994; Braudel 1986; Friedmann

[1986] 1995; King 1990; Renntich 2006; Sassen 1991; 2001).5 Moreover, the shift of global

trade toward Asia has led to the spectacular rise of cities in the Asian world and with that a

4
At this point, it is worth mentioning that there is more to development than growth and poverty. Questions of
equality, dignity, and justice are vital for development. In this context, refer to Nederveen Pieterse (2002) for a
critique of the contemporary poverty-centric approach of development.
5
In 2009, cities accounted for 70 per cent of the world’s GDP (World Bank 2009). In India, 62 per cent of the GDP
is generated in towns and cities (Government of India, 2009: xv).

2
renewed interest in urban development in this region (Amin and Thrift 2002; Roy 2009). While

the recent financial crisis has somewhat dented the reputation of New York, London, and Tokyo,

cities such as Singapore and Dubai have emerged as new centers of global finance (Roy and Ong

2011). Increasing importance of cities in the Asian world has reconfigured national growth

strategies, thereby altering the dynamics between national growth and urban development. To

seek global prominence, Asian states are systematically orchestrating growth by “reinventing”

their cities through extensive centralized political and economic investment.6 The role models for

these Asian cities are no longer cities in the West, but other “successful” cities in Asia. In this

context, Ong (2011:5) highlights that there has emerged an “inter-Asian horizon of metropolitan

and global aspirations” based on distinctive practices of urban modeling and inter-referencing

within Asian cities.

In the above contest, the “urban” has emerged as a key subject of development planning.

Driven by “urbanization for growth” strategies promoted by dominant multilateral institutions

such as the World Bank and the Asian Development Bank, predominantly rural countries such as

India and China are introducing ambitious urban renewal programs that focus on improving

urban infrastructure, quality of life, and governance, primarily aimed to facilitate fast growth

(World Bank 2009b).7 In this excessively growth-centered environment, growth discourses

inundate the popular media and the elite boardrooms of planners and business groups. These

discourses tend to normalize growth, masking its inequities, unevenness, and contestations.

Given this context, there is a need to strengthen the inclusive growth debate through a critical

6
In the Indian context, see Prime Minister Manmohan Singh’s quote on p. 75.
7
In India, the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) represents one such ambitious urban
renewal scheme launched in December, 2005 for the integrated development of urban infrastructure and services in
63 cities across India. Around Rs. 50,000 crore of reform-linked central assistance is to be provided under this
scheme over a period of seven years. For additional details on JNNURM refer to its website (http://jnnurm.nic.in/).
A recent New York Times article mentioned an ambitious Chinese plan to move 250 million rural residents into
newly constructed towns and cities over the next decade or so. For further details, refer to Ian Johnson, “China’s
Great Uprooting: Moving 250 million into Cities,” New York Times, June 15, 2013.

3
examination of the (rephrasing Ong) “emerging horizon of metropolitan growth aspirations” in

the emerging economies. This is further supported by a shift in the emphasis of development

policy toward the territorial dynamics, rather than national averages in understanding growth and

development (CMEPSP 2009; UNCDF 2012). In this regard, a place-specific analysis of growth

would be extremely productive to shift the focus away from a static, value-neutral, numerically-

driven, and taken-for-granted understanding of growth, to a more dynamic, context-specific, and

contested understanding of what constitutes growth and how growth discourses are produced in

specific contexts.

The Research Agenda

In light of recent development economics that emphasizes the importance of shared, inclusive

growth (Ali and Zhuang 2007; Commission on Growth and Development 2008; MGI 2010;

Planning Commission 2006; 2011; Rodrik 2006; 2008; Stiglitz 1998; State Council of China

2006; UNCDF 2013; World Bank 2009a), this study seeks to analyze:

 Contemporary growth strategies in emerging economies and how they relate to poverty

and inequality.

 Do they reflect a narrow development approach that privileges middle class interests or

are they broad-based and inclusive?

 The study tries to do this through the case study of Mumbai (India’s “global city”) by

examining the developmental visions and contestations of what is popularly referred to as

“Shanghaization” of Mumbai (a recent growth strategy modeled after “successful” Asian

cities, particularly Shanghai), within the dominant city-centric growth strategy in India.8

8
Bombay was officially renamed as Mumbai in 1995 by the right-wing Hindu fundamentalist Shiv Sena-led state
government. Henceforth in the dissertation, while referring to the city, I will alternate between Bombay and
Mumbai, depending on the historical period that is being discussed.

4
Bombay/Mumbai has been India’s premier city and has been characterized as India’s most

modern city (Patel 2004). This view of Bombay/Mumbai has not only been based on its

economic vitality, but also its cultural appeal as India’s most cosmopolitan city based on the

diversity of people, arts, theater, literature, music, and films that it has nurtured over the years.9

However, the city is also notorious for its seamy underbelly of crime and the underworld as well

as its right-wing anti-migrant and anti-Muslim urban movement since the 1960s in the form of

Shiv Sena. However, since the early 1990s, there is one imaginary that has taken center stage and

captured the hearts and minds of people (particularly of the elite in the city)—that of

transforming Mumbai into a “world class city.”

In the post-reform context, the national political and business elite have reinforced

Mumbai’s role as the driving force of India’s economic integration in the world economy.

Simultaneously, since the mid 1990s, urban planning in Mumbai is guided by entrepreneurial

and technocratic visions of transforming the city into a “world class city,” emulating the model

of Shanghai. Recently, the Prime Minister of India expressed a desire to “reinvent” Mumbai as

the “new financial capital of Asia” to strategically integrate the Indian economy with the finance-

driven world economy. This vision draws its inspiration from Shanghai and its success in

complete transforming itself within a short period of time. For example, during 1992 to 2007,

Shanghai experienced the fastest economic growth by any megacity in the world, averaging 12

percent annually!

As a development model, “Shanghaization” symbolizes “fast-growth” based on real-

estate revitalization to make the city internationally competitive. In Mumbai this has take the

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For example, the cosmopolitan ideal is reflected in a variety of cultural spheres. Bombay/Mumbai has been the
birthplace of modern Indian painting and progressive modern theater in both English and native languages. It is also
the home of the radical Dalit literature, produced primarily by the historically most oppressed castes. It also houses,
Bollywood, India’s premier film industry.

5
form of gentrifying former industrial districts, redeveloping slums, and regulating public space in

an effort to spur foreign investment. These redevelopment practices have resulted in the

displacement of the low-income residents (mainly industrial workers, slum dwellers, and street

vendors) from the central parts of the city to the urban periphery. However, these transformations

have also engendered various poor people’s movements in Mumbai that have made demands for

housing, livelihood, and good governance.

There is substantial literature on Mumbai documenting certain aspects of contemporary

transformation in Mumbai: deindustrialization, informalization of work, and economic and

spatial restructuring (Banerjee-Guha 2002; Bhowmik and More 2001; Deshpande and

Deshpande 2003; D’monte 2002; Ghorpade 2005); poverty and declining living standards for the

poor (Swaminathan 2003); the growing middle classes (Fernandes 2000; Nijman 2006); and the

privatization of basic services, especially in the area of health and housing (Mohan 2005). There

are also studies that have analyzed contemporary transformation in Mumbai in relation to

globalization (Banerjee-Guha 2002; Patel 2003; 2004). There are also studies that provide a

descriptive account of Shanghaization and its immediate politics (Mahadevia 2008b; Mahadevia

and Narayan 2005).

However, this study differs from the above studies in several ways:

~None of the above studies have systematically analyzed Shanghaization as an urban strategy of

growth and development in a broader context of inclusive growth in India.

~Further, even those that focus on Shanghaization have not analyzed the contextual specificities

within which the Shanghai model emerged as a dominant discourse of development in China and

India.

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~In addition to this, these studies ignore the agential and contested aspects of urban development

in Mumbai.10

This study tries to fill the above gaps by analyzing the deeper contingencies of urban

development in Mumbai by focusing on the processes, actors, visions, and practices that

constitute and contest urban growth strategies such as Shanghaization. In doing this, the study

problematizes the taken-for-granted assumptions of growth in India and calls for broad-based

inclusive development that goes beyond economic growth to focus on the quality and welfare

implications of this growth. Finally, it critiques the prevalent economic hegemony in

development thinking by incorporating ground-up, broad-based alternatives of development that

are equitable and sustainable.

Cities and Globalization

There is a large literature available on the theme of cities and globalization. The study is guided

by a deeper, historically informed understanding of globalization as a longue durée process

based on cross border exchange of capital, goods, and people (Arrighi 1994; Hobson 2004;

Hopkins 2002; Nederveen Pieterse 2006). Based on this approach, it is found that cities have

historically constituted as key nodes that sustained wider networks of production, exchange, and

culture (Abu-Lughod 1989; Arrighi 1994; Braudel 1986; King 1976; 1990; Rennstich 2006).

Historically, much of these exchanges took place either in the context of empires or in an inter-

state system (Sassen 2001). However, since 1960s, the increased mobility of capital and the

financialization of the world economy based on advances in global communication technologies

have further accentuated the strategic role of cities in the world economy beyond the boundaries

of the nation state (Sassen 1991; 2001). Moreover, since 1980s, we have witnessed a increasing

influence of neoliberal policies that have added onto this “globalization package” certain other
10
A few notable exceptions include Anjaria (2009) and Harris (2008).

7
features, namely, deregulation, marketization, financialization and securitization, and the lean

government (Nederveen Pieterse 2004:1). As a result of these changes, there has been a

structural transformation in governance, policy making, and accumulation, leading to a rescaling

of the state and devolution of power to the subnational levels (Brenner 1999). The rescaling of

the state has also accompanied an increasing role of global institutions and private actors in

urban development. As a result of these changes, there is a growing interest in theorizing the link

between contemporary globalization and urbanization, especially in terms of how global and

local forces interact in shaping the city. In the following section, I discuss four such

perspectives/approaches that inform this study, namely, the capitalist city, the global city, the

neoliberal city, and the contested city.

The capitalist city and the “created” environment

In the 1970s and the early 1980s, there was a “paradigm shift” in urban studies in the US led by

new critical approaches that questioned the dominant functionalist paradigm of the ecological

approach of the Chicago School (Gottdiener and Feagin 1988; Walton 1993).11 This “new urban

sociology” (Zukin 1980) or urban political economy viewed urbanism as a “particular

geographical form of spatial patterning of relationships taken by a particular mode of production

and the process of capitalist accumulation” (King 1990:72). Rather than seeing urbanism as an

inevitable or natural process, it was understood as a “created” environment influenced by the

processes of capitalist accumulation.

Harvey (1989b) uses the term “space time compression” and “spatial fix” to describe the

apparent contradictory logic of capitalist accumulation. On the one hand, contemporary

globalization has led to the elimination of geographical barriers to capitalist accumulation, while

11
For example, see Castells (1983) and Harvey (1973). Even though this new critical approach was labeled as “new
urban sociology,” most of the researchers were from diverse disciplines such as urban planning, political science,
and geography (Gottdiener and Feagin 1988).

8
on the other hand, this geographical expansion of capitalism is itself premised on the production

of relatively stable and immobile geographical landscapes such as the built environments,

transportation infrastructure, production and business complexes, and communication networks.

However, the new urban sociological research had an intra-national focus and there was

not much cross-national analysis or a broader discussion at the level of the world economy.

Moreover, most of this research was grounded in cities of Europe and North America and there

was less focus on cities in Asia and Africa. Nonetheless, the key contribution of new urban

sociology was that it provided the critical tools to understand the conflictual nature of urbanism.

Later, influenced by the world systems theory (Wallerstein 1984), scholars began to connect

localized processes of urbanization to structural economic changes in the world economy. It was

increasingly recognized that urbanization could not be understood solely through the political

economy of regions or within the boundaries of nation states and that there was a need for an

“analytic disarticulation of cities and nations” (Davis 2005: 97). Inspired by the dependency

school’s approach of exploring the “global context of national development,” urban sociologists

began to understand cities on the basis of capitalist development on the global scale (Davis

2005). Thus, urbanism in the “periphery” was understood in relation to the capitalist processes in

the “core.” The “development” of cities in the South and their function, organization, and form

was understood in terms of their incorporation into the world-economy (King 1990).

The capitalist city approach sensitizes us to the role of power and ideology in shaping the

urban environment and therefore, it promotes a critical understanding of urban development.

However, as critics have argued, new urban sociology tends to be too economistic and simplistic

in its analysis (Walton 1993). By privileging economic perspectives, new urban sociology often

ignored history and culture as critical variables in explaining urbanism (King 1990).

9
The global city and the geography of centrality and marginality

Building upon the “world city theory” popularized mainly through the writings of Friedmann

([1986] 1995), Saskia Sassen (1991; 2001) proposed a “global city” model based on an empirical

analysis of New York, London, and Tokyo. The “global city” model argues that along with the

geographical spread of economic activities, there is a need for an amalgamation or centralization

of these dispersed activities. This has resulted in the emergence of a centralized corporate

structure in order to coordinate the operations of a firm (Sassen 1991; 2000a). Due to their

relative densities, cities enable such agglomeration of activities and, therefore, acquire a new

strategic role in the functioning of the world economy (Sassen 1991).

A “global city” is “a place where certain kinds of work can get done” and the “things” it

makes are highly specialized services and financial goods (Sassen 2001: 5). By defining the role

of global cities in such a manner, Sassen helps us to rethink the dichotomy of manufacturing and

services by focusing on the “practice of global control” (emphasis added) where global cities

“produce” high-level business services. However, this global control is not possible through a

single city, but based on coordinated network of cities that produce a “geography of centrality,”

bringing together major international financial and business centers such as New York, London,

Tokyo, Paris, and Frankfurt. But on the other hand, dominant manufacturing centers and port

cities become peripheral in this process, leading to a simultaneous “geography of marginality”

(Sassen 2000a). This geography of centrality and marginality is also reflected within cities in

form of increasing informalization that accompanies the growth of a specialized service sector.

Over the years, the “global city” has become a hegemonic analytic in the academia that

articulates the dynamics between cities and globalization. Even outside the academic realm, the

10
“world/global city” talk has become influential in urban policy circles. In cities of the global

South, the “world/global city” is increasingly used as a frame of reference for growth and

development. The “global city” approach has also generated a lot of criticism from scholars from

the South. These scholars have been particularly critical of the universal claims of such theories

and their unwitting perpetuation of power hierarchies. Robinson (2002) argues that in urban

studies cities outside the West are assessed with a “pre-given standard of (world) city-ness” (p.

531). Further, it is argued that the urban hierarchies constructed by most world/global city

theorists are not merely analytical tools, but also “status yardsticks” that “measure cities in terms

of their global economic linkages, to locate their place in a hierarchy of nested cities, and to

assess their potential to join the super league” (Yeoh 1999:608). Smith (2002) argues that the

concept of “world/global city” provide a static picture of the urban world and does not

sufficiently explain the dynamism of place construction. The world/global city literature is also

criticized on grounds that it ignores local historical contexts and “overstates the power of actors

and institutions operating on a global level and underestimates local agency and contingency”

(Shatkin 2007:1). Thus, the “world/global city” approach ends up reifying cities as abstract

economic spaces.

The neoliberal city: “urbanization of neoliberalism”

It has been argued that the development of neoliberalism has been highly uneven across different

social-spatial scales (global, regional, national, or urban), rendering it polycentric and multiscalar

in character (Leitner et al. 2007). However, it is most manifest, visible, and open to contestation

at the urban scale (Brenner and Theodore 2002:367). Thus, cities are at the forefront of

neoliberalization (Brenner and Theodore 2002).

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 The emerging “neoliberal city” is characterized by the following features. First, an

entrepreneurial city that focuses on competition with other cities for investments, innovations,

and “creative classes.” Second, a city in which municipal governance dedicated for social

development is replaced by professional quasi-public agencies promoting economic

development, privatization of urban services, and competition among public agencies. Finally, a

city whose residents are expected to behave responsibly, entrepreneurially, and prudently and

who are responsible for their own successes and failures (Leitner et al. 2007:4)

Neoliberal urbanism is also characterized by a change in the nature of urban governance

from managerialism of the 1960s to entrepreneurialism in the 1970s and 1980s (Harvey 1989a).

Led by powerful business interests, cities are increasingly taking an entrepreneurial approach to

economic development prioritizing innovations and public-private partnerships to attract

investments and jobs. In this context, cities resort to several neoliberal strategies such as place-

marketing, enterprise and empowerment zones, local tax abatements, urban development

corporations, public-private partnerships, local boosterism, property redevelopment among

several others (Brenner and Theodore 2002:368).

Thus the primary goal of neoliberal policy experiments is to “mobilize city space as an

arena for both market-oriented economic growth and for elite consumption practices” (Brenner

and Theodore: 368). However, it is important to understand the agency that drives this

entrepreneurial activity. In this regard, it is argued that the power to organize space is conflict-

ridden and involves a wide variety of social actors coming together to form broader coalitions

facilitated by the government. These coalitions usually consists of local chambers of commerce,

local financers, industrialists, business leaders, real estate and property developers, educational

12
and religious institutions, local labor organizations, political parties, social movements, and local

state agencies (Harvey 1989a; Molotch 1976).

In a democratic environment, emerging growth strategies need to be perceived as serving

the greater common good. Therefore, the task for these growth coalitions is not merely to create

the material conditions for growth, but also discursively generate a consensus for growth. In

order to do this, pro-growth lobbies engage in civic boosterism through their business journals

and daily newspapers. Therefore, it is through the “power of machine language” that shapes

everyday life that emerging growth is normalized (Jonas and Wilson 1999:8).

The contested city: embeddedness and alternatives

It is argued that the manner in which global economic forces localize and get realized in various

national and urban contexts depend on the specific economic and socio-spatial contexts. Thus,

there is a distinction between the neoliberal ideology (market forces operate as immutable laws)

and “actually existing neoliberalism” because neoliberal projects are contextually embedded

(nationally, regionally, and locally) within “inherited institutional frameworks, policy regimes,

regulatory practices, and political struggles” (Brenner and Theodore 2002:350). Therefore, the

process of incorporation of global forces is always contested, generating possibilities of

alternative claim-making and citizenship (Sassen 2000b). As Leitner et al. (2007) argue,

“contestation is integral to the emergence of neoliberal regimes and remains closely articulated

with neoliberalism.”

Leitner et al. (2007) conceptualize contestation in a broad manner. Contestation is not

merely conceived as imaginaries and practices that resist or respond to neoliberalism, but also

involves those that existed prior to the embedding of neoliberalization and which lie outside the

13
scope of the neoliberal framework. As a result of this, they are resilient to neoliberalism and can

potentially rework it (Leitner et al. 2007:5). As Leitner et al. argue:

[T]here exist non-neoliberal social and spatial imaginaries, alternative forms of subject
formulation, and newly emerging practices of contestation that include alternative economic and
social practices and innovative alliances across multiple axes of social difference” (Leitner et al.
2007:22).
Therefore, the emerging urban politics is much more complex than the binary opposition of an

“urban glamour zone” and an “urban war zone” (Hamel et al. 2000:8). It is a result of

contradicting visions of “whose city is it.” The day to day urban struggles constantly involve

both negotiation and conflict and very specific demands and victories, but nonetheless they do

contribute to the overall nature of development of the city. The emergent urban politics may not

always take the form of contestation, but can also be collaborative in nature (for example, public-

private partnership). In this context, it is observed that there are three different kinds of struggles

emerging in global cities: first, are less institutionalized and spontaneous movements dealing

with the costs (poverty, income inequality) of gentrification, displacement, and pollution;

second, those that are based on institutionalized cooperation with the state in the form of public-

private partnerships in dealing with urban repair in the context of urban decay and marginality

(community-based organizations); third, are the episodic, spontaneous, and disruptive new poor

people’s movements that deal with the erosion of the welfare state that challenge the legitimacy

of local policies of exclusion (Hamel et al. 2000:9-14).

However, urban politics may not always take the form of organized social movements

striving for “social transformation” or “emancipation” (Bayat 1997:57). But as Bayat (1997)

argues, the everyday informal politics of diverse groups of “floating” population such as

migrants, refugees, unemployed, squatters, street vendors, and other marginalized groups may

take the form of the “encroachment of the ordinary.” This kind of politics is not long-lasting or

14
collectively organized, but mostly spontaneous and individualistic, driven primarily by the

necessity to survive and live a dignified life.

Based on this broader view of contestation, we need to explore contextually specific

interactions between the emerging market-oriented restructuring projects (within the inherited

historical and institutional landscape of the city) and their contestations at multiple socio-

political scales. It is not only important to understand top-down neoliberal urban restructuring,

but also the “bottom-up” and “sideways” contestation and accommodation between neoliberal

and non-neoliberal imaginaries and practices that collectively shape the future of the city.

Methodology

The city and the text: critical urban discourse analysis

This study uses discourse analysis as a tool to critique dominant urban growth discourses in

Mumbai. Discourse analysis has been an important theme in international development studies

(Apthorpe and Gasper 1996; Grillo and Stirrat 1997; Nederveen Pieterse 2011) and in critical

development studies (Munck & O’Hearn 1999).12 As a tool of criticism, discourse analysis is

particularly useful in “critiquing hegemonic discourses and exposing its silences, omissions and

double talk” based on its critical appraisal of development policy, official texts, and development

thinking (Nederveen Pieterse 2011: 239).13 In the field of international development studies,

discourse analysis has remained an influential component of the post-development approach

(Escobar 1995; Sachs 1992). Although its merits as an interpretive methodology have been

widely recognized, as an ideology, post-development has been criticized for its “development

12
Given the constraint of space, I do not provide a comprehensive review of discourse analysis, but only restrict
myself to discourse analysis in the interdisciplinary fields of development and urban studies. However, it should be
noted that discourse analysis informs multiple disciplines such as sociology, anthropology, linguistics, psychology,
geography among other, and the use of discourse analysis differs in each of them in terms of their assumptions,
analysis, and methodologies.
13
For example, see Rew (1997) and Tucker (1999).

15
agnosticism” (Nederveen Pieterse 2011:238) and its inability to alternative policy perspectives

(Corbridge 1998; Nederveen Pieterse 2010).

Recently, discourse analysis has gained widespread acceptance in the field of urban

policy research (Hajer 1993; Hastings 1999; Fairclough 1985; 1992; 1995; Jacobs 1999; 2006;

Lees 2004).14 It is acknowledged that along with actual planning decisions, it is equally

important to analyze the power and ideological conflicts that shape the deliberation of policy

implementation and to recognize the important role of language in the policy arena (Jacobs

2006). A closer examination of language in the form of utterances and texts in the policy context

provides a more nuanced understanding of the policy process.

Social reality is mediated through discourse and there is an ongoing struggle over its

meaning (See Laclau and Mouffe 1985). In this discursive struggle, there is a broad array of

discourses competing to establish their version of the social world. When discourses become

hegemonic, the social practices they embody become “common sense” masking their political

contingency (Gramsci 1971; Laclau and Mouffe 1985). Therefore, discursive and non-discursive

worlds are not antithetical to each other, but dialectically constitute each other (Fairclough

1992). As shown ably by Michael de Certeau (1984: 125), language is not merely expressive, but

also productive as discourses “open a field” for social practices. In the same context, Fairclough

et al. (2004) explain, “people not only act and organize in particular ways, they also represent

their ways of acting and organizing, and produce imaginary projections of new or alternative

ways, in particular discourses” (p. 2).15 Therefore, the manner in which actions are represented in

language is also important.

14
For a critical appraisal of different approaches as well as studies using discourse analysis in urban policy research,
see Jacobs (2006). Also, see Urban Studies (1999) for an initial discussion on discourse analysis.
15
Cited in Jacobs (2006:40).

16
 However, discourse analysis is not free from criticisms. One particularly important

criticism leveled against discourse analysis is worth noting here. Discourse analysis is criticized

for privileging individual agency and subjectivity over structural factors (Jessop 1991; Badcock).

In a similar vein, Nederveen Pieterse (2011) argues that in order for discourse analysis to be

more effective and avoid the trap of “discursivism,” it needs to go beyond the discourse and link

the discourse to political economy and take into account the wider political and economic

context. Guided by these criticisms, this study is influenced by Norman Fairclough’s “critical

discourse analysis” (CDA) (1989; 1992; 1995) which is sensitive to the context of power and

political economy and connects discourses to broader political and economic contexts. Unlike

the discourse theory of Laclau and Mouffe which contends that the social world is wholly

constituted by the discourse, the CDA distinguishes between the discursive and non-discursive

worlds, which mutually constitute each other through a dialectical relationship. Therefore,

according to CDA, discourse is a “way of talking about and acting upon the world which both

constructs and is constructed by a set of social practices” (Candlin and Maley 1997:202, cited in

Rear N.d). As Fairclough puts it, “discourse is a practice not just of representing the world, but

of signifying the world, constituting and constructing the world in meaning (Fairclough

1992:64).

However, this process of representing and constructing the world is a contested one,

where different groups compete to establish a particular version of social “reality” in order to

pursue their objectives. And the methodological assumption that guides CDA is that is that

“these conflicts are revealed in texts and speech as well as in the actions of individuals, interest-

groups and government agencies” (Fairclough 1999:203).

17
 According to Lee (2004), methodologically, discourse analysis generally involves

highlighting of two things: “first, the interpretive context, that is the social setting within which

discourse is located; second, the rhetorical organization of the discourse, that is the

argumentative schema that organize a text and establish its authority” (p. 104). Based on the

analysis of spoken or written texts, Fairclough (1992) proposed a three-dimensional framework

of discourse analysis involving the text analysis, discursive practice, and social practice which

connects the individual discursive event (“language use”) to wider aspects of social practice.16

Jacobs (2006:42) summarizes the three dimensions as follows:

1. Text analysis—the actual analysis of the text, its structure, vocabulary and grammar.

2. Discursive practice—the analysis of the processes in which texts are produced and the

context in which policy statements are made and how they relate to other debates and

literature.

3. Social practice—a study of discourse in relation to wider structures and ideology.

Personal research narrative

Having lived in Mumbai for several years as a child and intermittently as an adult, I am familiar

with the changing ethos of the city. My initial interest in the city was in studying the postcolonial

transformation of the textile mill-district in Mumbai, Girangaon (the village of the mills). The

textile industry was the sweat and blood of Mumbai for more than a hundred years. As a child, I

was enamored by the stories narrated by people who worked in the mills. Bombay for me then

symbolized a city of the working classes. Even though I was too young to understand some of

the dramatic struggles waged by the mill workers in the turbulent 1980s, I do have visual

memories of how the social and physical landscape of the city was shaped by the mills: be it the

16
Although, there are competing definitions of discourse and discourse, Van Dijk (1997:3) provides an interesting
way to understand the difference between “discourse” and “discourse analysis” where he defines “discourse” simply
as “language use” and “discourse analysis” as “the study of talk and text in context” (Cited in Jacobs 2006).

18
towering mills that dotted the skylines of Mumbai, the series of wholesale cloth stores in the

mill-district, or the cultural festivities of the mill-workers and their families (especially the most

popular Ganesh festival). However, over a period of time, I realized that the mill-district was one

(arguably one of the most important) among several important elements of transformation taking

place in Mumbai. Moreover, as I studied existing urban studies literature, I came to realize that

there was merit in understanding the transformations in Mumbai at a much broader level.

Mumbai of the 1990s and 2000s had become noticeably different than the one in the 1980s and

earlier. In the post-reform period, the city was introduced to foreign products, cable network,

malls, and “world class city” desires. A section of the city-elite were now talking about a

complete “make-over” of the city, of transforming it into a “world class city” to the likes of

Shanghai. It is in this context that I reformulated my research idea. I was now more interested in

understanding the key processes and actors involved in producing this discourse of urban growth

and transformation and how this discourse was gaining legitimacy in the policy circles. I thought

this was a fundamental question for analysis as language is power and is a critical tool in

transforming the social world.

My first systematic attempt of research was a preliminary study of two months in the

summer of 2008. During this period, I collected newspapers articles and reports from various

documentation centers and libraries in Mumbai. Along with this, I also conducted interviews

with a few activists and academics in the city. As a result of this preliminary fieldwork, as well

as my earlier visits to the city, I established contacts with representatives of several organizations

in the city. I was also able to identify key stakeholders that shaped urban development in

Mumbai. On returning to the US after my preliminary fieldwork, I wrote and defended my

19
dissertation proposal and later spent a year in Mumbai (December 2008 to December 2009)

conducting extensive qualitative research.

Research methods

At the operational level, the study was guided by three specific questions:

1. To analyze the genealogy of the discourse of Shanghaization as an urban growth strategy

in Mumbai by focusing on the processes, actors, visions, and practices that shaped it and

were shaped by it.17

2. To assess how diverse stakeholders in Mumbai (representing the state, the market, and

the civil society), mediate, make sense of, and contest the dominant discourses and

practices of growth and development.

3. To explore if these contestations enable alternative visions of growth and development in

Mumbai.

In order to gather data to answer the above questions, I employed multiple research

methods that involved archival research, in-depth interviews, and ethnographic observation. I

drew on multiple secondary sources including academic literature, government reports,

newspaper articles, and newsletters of various organizations in the city. I also visited several

governmental and non-governmental organizations and documentation centers in Mumbai.

I conducted about 40 in-depth interviews with representatives of diverse stakeholders in

Mumbai that included poor peoples’ movements, trade unions, civic groups, government

17
My understanding of the term “discourse” is influenced by the political economy tradition of discourse analysis
(discussed in detail later) which views discourse analysis as “a tool for uncovering certain hegemonic thinking and
talking about how things should be done that serve certain vested interests” (Lees 2004:102). Methodologically, this
involves a close scrutiny of rhetoric and the narrative structure of texts and to understand how issues are framed. In
terms of its definition, I find Candlin and Maley’s (1997) definition of discourse particularly useful. They define
discourse as a “way of talking about and acting upon the world which both constructs and is constructed by a set of
social practices” (cited in Rear N.d). Therefore, it is important to see how action is represented in language.

20
agencies, non-government organizations (NGOs), community-based organizations (CBOs),

business think-tanks, as well as several social activists, social workers, urban planners, municipal

officials, politicians, and developers. I narrowed down the list of people to interview on the basis

of my reading of available literature on Mumbai as well as the theoretical leads guiding the

study. An important criterion of choosing the respondents was their “perceived” influence in

shaping the affairs of the city. This was based on my subjective judgment based on my reading

of contemporary literature on Mumbai and the frequency with which these people were quoted in

newspapers, reports, and during informal conversations with people. I also relied on the “snow-

ball” method to find potential respondents. During my preliminary research in summer, I made

contacts with people, who directed me to other prospective respondents. The questions were

tailor-made for each organization, but also involved a few common questions that aimed to

gather information about the objectives and activities of the organization, as well as the

particular challenges it faced in the context of contemporary urban development.

Finally, I selectively engaged in ethnographic observation by “immersing” myself in

multiple sites including talks, workshops, and meetings organized by several organizations and

social movements. I also visited sites that have been at the forefront of urban redevelopment such

as the mill district, slums communities displace by the 2003-04 evictions, recycling grounds, and

resettlement sites of the displaced urban poor, to visually document the ongoing spatial

transformations and displacements and to gain a richer understanding into poor peoples’ daily

struggles against inequality, dispossession, and resistance.

In chapter 1, I situate my study in the wider context of the emerging discourse of

“inclusive growth.” I argue that in the context of inclusive growth, the urban has emerged as a

critical development problematic that seeks to balance high growth and reduction of poverty and

21
inequality and, therefore, justifies attention. Chapter 2 provides a historical context to Mumbai’s

contemporary transformation. Using a longue durée historical perspective, I trace the

development of Bombay/Mumbai as a “colonial port city.” In doing this, I try to explain how

particular historical circumstances of Bombay/Mumbai bear heavily on its contemporary

transformation. The discussion specifically centers on the historically produced inequalities. In

chapter 3, I critically discuss the Shanghai model of development as it emerged in China. I argue

that although the Shanghai model was a remarkable economic success, it was premised on

unequal and anti-poor growth. Given this fact and the different socio-political realities of the two

cities, I argue that it is not a good model for Mumbai. Thus, this chapter provides a critical

comparative context to the discussion of Shanghaization of Mumbai. In chapter 4, I focus on the

contingencies that produce Shanghaization as the discourse of growth and transformation in

Mumbai. I also critically analyze this discourse itself and how explain how it emerged as a

dominant city-centric growth strategy in India. In chapter 5, I highlight some contemporary

“development” projects in Mumbai and the displacements engendered by them. In chapter 6, I

analyze competing discourses of urban development emerging from the struggles of the urban

poor, particularly the slum dwellers, street vendors, and former textile mill-workers. I discuss

how these contestations enable alternative visions of development of Mumbai. I also highlight a

few competing claims on Mumbai and the particular challenges they pose to the grand visions of

transformation in Mumbai. Finally, in the conclusion section, I draw some general conclusions

based on the study in the context of inclusive growth.

22
 CHAPTER 1

INCLUSIVE GROWTH AND THE URBAN QUESTION

~On July 11, 2006 Mumbai a series of seven bombs in a span of 11 minutes ripped through the Western
line of the Suburban Railway that left more than 200 people dead and 700 injured. While the front pages
of local newspapers carried stories about the terrible tragedy, the Prime Minister of India, Manmohan
Singh, commented, “No one can come in the path of our progress…[t]he wheels of our economy will
move on.” Defying all predictions, India’s stock market rose by three percentage points on the morning
after the bombings.18

~Just a few months before the bomb blasts, on December 3, 2005, the Prime Minister had launched one of
the most ambitious urban renewal programs in the country aimed at changing the face of infrastructure
and quality of life in Indian cities.19 Months later, the Prime Minister flagged-off the construction of a
mega-infrastructure project in Mumbai—the Mumbai Metro Rail Project—the first metro project financed
through public-private partnership in India. On that occasion, the Prime Minister remarked, “I have often
said that Mumbai is not an ordinary city, its contribution to the creation of wealth in our country, the
symbol of hopes and aspirations of a resurgent India… it is an embodiment of the spirit of India that India
is out to embrace globalization…Mumbai symbolizes India to the external world.”20

~Four years later in 2009, at the fourth anniversary of the launch of the mega urban renewal scheme
(JNNURM), the Prime Minister (who was now in his second stint as the Prime Minister) said, “I wish to
reiterate our government’s commitment to the development of the urban sector. This commitment stems
from the recognition that the balanced development of the urban sector is an integral part of our strategy
of inclusive growth…We will also work to widen and deepen urban renewal policies and reforms…we
need to concentrate on the need for rural-urban integration.”21

The above quotes by the Prime Minister of India point to two key trends in contemporary

globalization—first, the rise of emerging economies in Asia and the emergence of “inclusive

18
Mumbai bombers “will never win,” BBC News, July 12, 2006 http://news.bbc.co.uk/go/pr/fr/-
/2/hi/south_asia/5173646.stm
19
This program is referred to as the Jawaharlal Nehru National Urban Renewal Mission (JNNURM).
20
PM lays foundation stone of phase-I of Mumbai Metro, June 21, 2006,
http://pmindia.nic.in/speech/content4print.asp?id=342
21
PM’s address at the National Conference of the JNNURM, December 3, 2009
http://pmindia.nic.in/lspeech.asp?id=859. Emphasis added.

23
growth” as a hegemonic discourse in development policy (Harris 2005; Nayyar 2006; Nederveen

Pieterse 2008; Prestowitz 2005; Kaplinsky and Dessner 2006; Rodrik and Subramanian 2004);

second, the emergence of the urban as a critical development problematic within the emerging

economies that seeks to balance high growth and reduction of poverty and inequality. This

statement from the Eleventh Five Year Plan of India (2007-2012) bears testimony to the above

fact: “Indian cities will be the locus and engine of economic growth over the next two decades,

and the realization of an ambitious goal of 9—10 per cent growth in GDP depends

fundamentally on making Indian cities much more livable, inclusive, bankable, and competitive”

(Planning Commission, Government of India 2008:394). Further, it is prescribed that there

should be a massive investment for infrastructure development in “prosperous cities,” if India

desires to “continue on its current path” (MGI 2010).

Although, there is substantial literature in global and development studies that has

addressed the dynamics of growth and inequality, there is insufficient attention paid to the urban

question as an important mechanism mediating growth and inequality. My key argument is that

the urban question lies at the heart of the emerging economies and their vision of inclusive

growth and therefore, we need to pay sufficient attention to the emerging urban growth

discourses and how they relate to inequality. In what follows, I trace the emergence of the

inclusive growth discourse in a wider context of reconfiguration of development thinking in

terms of what is called a “post/new Washington consensus.” Based primarily on the experience

of the South, this new development paradigm focuses on broad based growth that balances high

growth with inclusiveness. I later discuss the different articulations of the concept of “inclusive

growth” and how cities are emerging as key actors in this inclusive growth framework. In the

final section, I discuss the Indian case and show how urban development has emerged as a key

24
vector in the larger dynamic of growth and inequality in India. I thereby lay the foundation for

the subsequent critique of India’s city-centric growth strategy in the next few chapters based on

the case of Mumbai.

A “Post-Washington Consensus”: Reimagining Growth and Development

It is argued that the “twenty-first century globalization” is markedly different on two accounts: a

relative decline of American hegemony and neoliberalism and the emergence of new forces

constituted by the emerging economies in the global South. The experience of neoliberal reforms

of privatization, deregulation, and trade liberalization subsumed under what is famously called

by Williamson (1990) as the “Washington consensus,” has not yielded desired results. Despite

some recovery in the 1990s, growth in Latin America has remained limited and unequal; most of

Africa, barring a few exceptions such as Botswana, experienced negative growth rates; even after

decades of reform, former communist countries in Eastern Europe have not seen improvement in

their economic situation since 1990s; moreover, there have been frequent crises in several

regions of the world including Latin America, East Asia, Russia, Turkey and recently, the United

States (Rodrik 2006; Commission on Growth and Development 2008).

The locus of new trade and finance has shifted to the emerging economies in the South

(particularly in Asia) which are growing faster than the advanced economies of the North (Harris

2005; Nederveen Pieterse 2008; Palat 2009; Prestowitz 2005). If we consider Asia, in 2006 total

exports from Developing Asia alone constituted 34.1 per cent of the world’s exports.22 In 2005,

Developing Asia received 21.8 per cent of the total FDI of the world, up from 1.2 per cent in

1980. The percentage share of global GDP of Developing Asia increased from 9 per cent in 1980

to 10.5 per cent in 2005. In terms of the growth rate, Developing Asia has maintained a steady

22
According to the Asian Development Bank, “Developing Asia” refers to its 44 developing member countries and
Brunei Darussalam, an unclassified regional member (ADB 2012).

25
GDP growth rate of 5-6 per cent during 1980-2005. Much of this growth is driven by China and

India. China maintained growth rates of a little more than 10 per cent during 1980-2000,

decreasing slightly to 9.6 per cent in 2000-2005, while India maintained a steady growth rate of

more than 6 per cent during 1980-2005 (Mahadevia 2008a). Although, the recent global

recession has dented their growth slightly, it is still impressive in comparison to the advanced

economies of the world (see Table 1 below).

Table 1. Trends in GDP growth (%)

Developing
China India Major Industrial Economies
Asia
US Eurozone Japan
2007 10.1
2008 6.7
2009 6.0 9.2 8.4
2010 9.1 10.4 8.4 3.0 1.9 4.4
2011 7.2 9.2 6.0 1.7 1.4 -0.7
2012 (projected) 6.9 8.5 7.0 2.0 -0.5 1.9
2013 (projected) 7.3 8.7 7.5 2.3 1 1.5
Source: Compiled from ADB (2012).

Not only has rapid growth in Asia stabilized the world economy, but it has resulted in

dramatic improvements in the living standards in the region and an absolute reduction in the

number of people living in poverty. During 1990−2010, average per capita GDP in Asia and the

Pacific increased from $1,633 to $5,133. In the same period, around 716 million were lifted out

of poverty as the proportion of the population living on or below the $1.25-a-day poverty line

fell from 53.9 per cent in 1990 to 21.5 per cent in 2008. Moreover, seventeen countries reduced

poverty by more than 15 percentage points in the period (ADB 2012:38).

26
 Based on the East Asian “miracle” in the early 1990s, there were calls for a “post

Washington consensus” in development studies (Stiglitz 1998). According to Gore (2002:789),

there was a “paradigmatic shift” in development thinking due to the challenge posed to

Washington consensus by a new “Southern consensus” that converged around Latin American

structuralism and East Asian developmentalism and which was largely at variance with the

Washington consensus ideology. Unlike the Washington consensus which was based on a

narrow goal of economic growth based on standardized prescriptions of macroeconomic

stability, trade liberalization, and privatization, proponents of the post-Washington Consensus go

beyond economic growth to include broader goals of sustainable and equitable development. In

Stiglitz’s (1998) words:

We seek increases in living standards-including improved health and education-not just increases
in measured GDP. We seek sustainable development, which includes preserving natural resources
and maintaining a healthy environment. We seek equitable development, which ensures that all
groups in society, not just those at the top, enjoy the fruits of development. And we seek
democratic development, in which citizens participate in a variety of ways in making the
decisions that affect their lives. (P. 31)
In recent times, the success of emerging economies in Asia has led to even bolder claims about

the end of the Washington consensus. As Rodrik (2006) puts it, “the debate now is not over

whether the Washington consensus is dead or alive, but over what will replace it” (p. 973).

Guided by the insights of the report of the Commission on Growth and Development (2008),

considered as a watershed in contemporary development thinking, Rodrik (2008) proclaimed the

emergence of a “new Washington consensus” that is less prescriptive and more diagnostic and

experimental in its approach toward growth. The report also goes beyond growth strategies to

include health, education, and other social policies. Based on Rodrik’s (2008) assessment of the

27
Commission on Growth and Development report, Table 2 summarizes the differences between

the old and the new Washington Consensus models.

Table 2. Washington Consensus Models: The Old and the New

Old Washington consensus New Washington consensus
Presumptive: strong preconceptions about the Diagnostic: relative agnosticism about what
nature of the problem (government works
regulation, poor governance, too little public
spending)
Laundry list of reforms. Simultaneous, rather Focuses on the most significant economic
than sequencing of reforms bottlenecks and “binding constraints”
Comprehensive reforms: liberalize trade, Policy experimentation: relatively narrowly
privatize public enterprises, deregulate targeted initiatives in order to discover local
prices, bring down inflation through solutions
monetary and fiscal retrenchment
Universal recipes—“model” institutional Suspicious of universal fixes. Influenced by
arrangements, “best practices,” rules of China’s experimental gradualism since 1978
thumb (spectacular episode of economic growth and
poverty reduction)
Failed to generate much growth in those Each country must devise its own mix of
countries in Latin America and Africa remedies
Source: Compiled from Rodrik (2008).

Even in theorizing of growth and development, there is a shift toward non-neoclassical

frameworks that are historically informed and institutionally specific and which take into account

diverse social processes, incorporating insights from multiple disciplines. One such recent

example is De Paula and Dymski’s Reimagining Growth (2005: 4), which states: “democratizing

theory means, at a minimum, developing approaches to conceptual thinking about growth and

development that are ‘open’ – that can respond interactively and inclusively to the concerns and

perspectives of multiple interests, social constituencies, and perspectives.”

28
 It is within this context that the discourse of inclusive growth needs to be understood.

Along with this academic shift, the emergence of inclusive growth as a central development

planning goal in countries such as China, India, and Vietnam is largely influenced by a not-so-

widely discussed aspect of growth in emerging economies—increasing inequality.

Growth and Inequality

Why does inequality matter?

There are several reasons why inequality matters and should, therefore, be an important focus of

development policy along with poverty reduction. First, inequality is important for growth.

Studies have unanimously shown that, unlike poverty, growth has no impact on income

distribution and that there is no virtuous circle between higher growth and lowering of inequality

levels (Dollar and Kay 2002; Easterly 1999; Chen and Ravallion 1997; Deninger and Squire

1996). However, there is a deep connection between inequality and growth. It is observed that

redistribution positively impacts growth (Easterly and Rebelo 1993; Perotti 1996) and that asset

inequality (particularly land distribution) can undermine growth and pro-poor policies (Birdsall

and Londono 1997; Deininger and Squire 1998). Policies that cater to better education,

macroeconomic stability, and infrastructure are not only good not for growth but also for

inequality. Therefore, as highlighted by the human development approach way back in the early

1990s, what matters is not growth, but the quality of growth (Haq 1995; Nederveen Pieterse

2010). Second, inequality also impacts poverty. High initial conditions of inequality slow down

the pace of poverty reduction (Birdsall 2004). This is especially important for developing

countries that are overwhelmed by inequalities produced historically through colonialism and

consistent policy and market failures. Therefore, the context in which inequality rise also matters.

Third, inequality can also undermine the political process, leading to political instability,

particularly in countries with a weak and unrepresentative democratic politics (Birdsall 2004;
29
Nederveen Pieterse 2002).23 Therefore, although growth is crucial for poverty reduction and in

expanding the social sector, in order for it to be sustainable it has to be premised on equity and

equality of opportunity.24

The extent of inequality

There is another sub-plot to the story of the “new Asian dynamism.” While high-growth is

celebrated by the popular media and the government, it has uneven and has accompanied

deepening of rural and urban poverty and inequality in the emerging economies (Davis 2006;

Dicken 2003; Nederveen Pieterse 2008a, 2008b; Sassen 2000a). The biggest challenge faced by

these rapidly growing economies is to ensure that economic growth is sustainable and equitable.

However, the recent experience has shown that inequality has increased globally, nationally, and

regionally between the rural and urban areas.

Global inequality—Inequality is on the global map today, for obvious reasons. Although

there is no historical data to measure the direction of change of global inequality (inequality

between people, regardless of their nationality and where they live) it is found to be extremely

high (Gini coefficient of 62-66) is suspected to be unparalleled in human history (Milanovic

2007).25 If the data is broken down further we find that the top 5 per cent of the highest earners

in the world receive almost one-third (33 per cent) of the world income, whereas, the bottom 5
23
Spurred by increasing “mass incidents” of unrest in China (from 8700 in 1993 to 90,000 in 2010), China now
spends more on its internal security than on its external defense. According to a 2010 report of the Chinese Finance
Ministry, China spent 548.6 billion yuan ($83.5 billion) on internal security, while it spent 533.5 billion yuan ($81.2
billion) on national defense. Further, for 2012, the government plans to spend 624.4 billion yuan on public security,
a 13.8 percent increase from 2010, and 601.2 billion yuan on defense, a 12.7 percent increase (See Jeremy Page,
“Internal Security Tops Military in China Spending,” China Real Time Report, March 5, 2011).
24
In the development literature, equity refers to outcome or results either based on historical circumstances or
through market conditions, whereas equality of opportunity refers to access based on starting points. Addressing the
former is more controversial in policy and is achieved through redistributive mechanisms, while the latter is more
widely accepted and involves creating a merit-based opportunity structure through a provision of universal access to
public services such as education and health.
25
The Gini coefficient is a standard matrix used to measure inequality. It ranges from 0 (perfect equality) to 1
(perfect inequality). However, for convenience it is shown as a percentage by multiplying by 100. Gini coefficient at
or greater than 40 is considered as the threshold for “high inequality.”

30
per cent receive only 0.2 per cent, a ratio of 165:1. Moreover, the top 10 per cent of the people in

the world get half of the world income, while the rest of the 90 per cent receive the remaining 50

per cent (Milanovic 2007:39). Even in the Asian context, as shown below, remarkable success in

growth and poverty reduction has accompanied an increase in inequality since early 1990s.

Inequality in Developing Asia—since the early 1990s to late 2000s, the overall Gini

coefficient of Developing Asia increased from 39 to 46. Although it is lower in comparison to

Sub-Saharan Africa and Latin America, if we take into account the trends in inequality,

Developing Asia does not do too well. We find that during the last decade, most Sub-Saharan

African countries and more than half of Latin American experienced a decline in inequality.

However, in Developing Asia, 11 out of the 28 economies, covering 82 per cent of the region’s

population, experienced increases in inequality. The Gini coefficient for China went up from

32.4 to 43.4 and for India it increased from 32.5 to 37.5 from early 1990s to late 2000s.

Moreover, inequality in China and India has steadily increased during 1990-2000. If we compare

inequality between top 20 per cent quintile and the bottom 20 per cent quintile we find that that

ratio almost doubled in China, while in India it has increased moderately (see Table 3 below).

Table 3. Inequality Trends in China and India

Annualized Annualized
Gini coefficients26 Quintile income28
growth rate27 growth rate
1990s 2000s 1990s 2000s
China (1990-2008) 32.4 43.4 1.6 5.1 9.6 3.6
India (1993-2010) 32.5 37.5 0.7 4.8 5.7 1.1
Source: Compiled from ADB (2012).

26
Based here on per capita expenditures, the Gini coefficient ranges from 0 (perfect equality) to 1 (perfect
inequality). For convenience, here and in following tables, it is multiplied by 100. Gini coefficient at or greater than
40 is considered as the threshold for “high inequality.”
27
The annualized growth of the Gini coefficient refers to growth between the earliest available figure in the 1990s
and the latest available figure in the 2000s.
28
The quintile income (or expenditure) ratio is the ratio of the total income (or expenditure) of the top (richest) 20%
of the population to that of the bottom (poorest) 20%.

31
 Regional inequality—In terms of regional inequality, we find that the gap between urban

and rural incomes in Developing Asia has increased. In China, the gap has increased remarkably

since 1990s to late 2000s, whereas in India too there has been a moderate, but a steady increase

(see Table 4 below).

Table 4. Urban-rural income gap 1990-201029

1990s Mid-1990s 2000s Mid-2000s 2010
China 1.74 1.80 2.08 2.27 2.37
India 1.25 1.25 1.25 1.25 1.33
Source: Compiled from ADB (2012).

When we look at the pattern of urban and rural inequality in China and India since early

1990s to late 2000s, we find that there has been a similar increase in urban and rural inequality

(about 10 percentage points). However, inequality in rural areas is higher than urban areas. In the

case of India, we find that since early 1990s inequality has been higher and increased faster in

urban areas than rural areas. This is a clear indicator that the recent rapid growth has not been

shared (see table 5). This alarming increase in inequality amidst unprecedented growth and

poverty reduction in Asia point to two important facts: first, rapid growth in itself does not

guarantee equity; second, as we shall see in the next section, inequality has direct implications

for broad based growth.

29
Although inequality is usually discussed in terms of inequality of incomes, the ADB estimates on India are based
on the distribution of consumption as there are no official data on the distribution of household incomes in India.

32
 Table 5. Pattern of inequality in China and India (Gini coefficient)
Urban Rural
China 1990 25.59 30.57
1993 28.47 32.13
1996 29.09 33.62
1999 31.55 35.39
2002 33.46 38.02
2005 34.8 35.85
2008 35.15 39.4

India 1993 34.37 28.56

2004 37.59 30.46
2009/10 39.35 29.95
Source: Compiled from ADB (2012).

The Inclusive Growth Discourse

In the context of increasing inequality inclusive growth has emerged as the new mantra of

development policy. The term has become popular among diverse actors that include

government leaders, economists, planners, academic scholars, and in business circles. Unlike

earlier development thinking, the consensus in development thinking is that trade-offs between

growth and inequality are not inevitable. This fact is highlighted by a recent survey of Asian

policy makers revealed that over 65 per cent of respondents agreed that inequality in their

countries were very high and a majority believed that success in poverty reduction does not

justify increase in inequality (ADB 2012).On the contrary, it is now believed that inequality is a

serious impediment for inclusive and sustained growth (UNCDF 2012). Therefore, it is now

believed that inequality warrants equal attention as poverty. This new change in thinking in

policy is reflected in recent development policies across Asia, where countries have explicitly

made goals to make growth more inclusive. In India, the guiding objective of the Eleventh Five

33
Year Plan (2007-2012) is “faster and more inclusive growth” and prioritizes “a growth process

which yields broad-based benefits and ensures equality of opportunity for all” (Planning

Commission, Government of India 2008a:2). The current Twelfth Five Year Plan of India (2012-

2017) which is currently being drafted continues to focus on “faster, sustainable, and more

inclusive growth” (Planning Commission, Government of India 2011).

Similarly, in China, the new leadership in 2002 underwent a rethinking in development

thinking that focuses on balanced development and building a “harmonious society.” The new

approach of “scientific development” (kexue fazhanguan) or “comprehensive, coordinated, and

sustainable development” that was outlined by President Hu Jintao in 2003, sought to correct the

earlier uneven economic growth that overly emphasized a GDP-centric economic growth that

neglected social welfare (Fewsmith 2004). This new approach has been further crystallized in

China’s Eleventh Five Year Plan (2006-10) (State Council of China 2006).

Although the discourse of inclusive growth has gained greater traction in recent years,

scholars argue that it is in fact a revisionist Keynesian version of “redistribution with growth”

that was popular in the 1970s and which fell out of favor with the onset of neoliberalism

(Nederveen Pieterse 2010). It became evident in the 1960s that economic development did not

necessarily lead to employment generation, reduction of poverty and inequality, and provision of

basic needs. This led to alternative redistributive and basic needs framework of development that

moved away from simple economic growth to broader questions of human development and

social equity (Haq 1995). It was in this context that the World Bank adopted the approach of

“redistribution with growth” and rather than arguing that there are trade-offs between growth and

equity, they were seen as complementing each other. More specifically, the International Labor

Organization’s (ILO) basic needs approach in the 1970s gave equal importance to growth and

34
redistribution and argued for a more balanced approach to development that catered to basic

needs, participation, and employment generation (Brohman 1996:205). However, with the rise of

neoliberalism in the early 1980s support for this approach gradually eroded.

The recent inclusive growth discourse marks a return of the “redistribution with growth”

approach, however, albeit in a different context. In the following section, I discuss three

contemporary approaches of the concept that have significantly informed development policy:

the Commission on Growth and Development (2008), the Asian Development Bank, and the

World Bank.

Growth Report: Strategies for Sustained Growth and Inclusive Development (henceforth

the GR) (Commission on Growth and Development 2008)—Chaired by Nobel Laureate Michael

Spence, the task of this independent commission was to understand how developing countries

can achieve fast, sustained, and equitable growth. The GR specifically targets policy makers in

the developing world and is a particularly important starting point for the discussion of inclusive

growth.

The GR begins with a notion that growth is a necessary, if not sufficient, condition for

broader development. According to the GR inclusiveness is an essential ingredient of any

successful and sustainable growth strategy. As a concept, inclusiveness “encompasses equity,

equality of opportunity, and protection in market and employment transitions.” By “equity,” the

GR refers to outcomes created by the market. In this context, policy plays a critical role in

constraining these outcomes through appropriate redistributive mechanisms, spending programs,

and funding of service provision as markets do not play an equalizing role. By “equality of

opportunity,” the GR refers to access to various opportunities. Thus, systematic inequality of

opportunity can prove to be detrimental to the growth process as it can lead to political conflicts

35
and therefore should not involve any trade-offs. Equality of opportunity can be addressed

through universal access to public services such as education and health and a meritorious

selection system in both the government and private sector.

Based on the above notion of inclusiveness, the GR makes particular recommendations that

can bring about an inclusive growth:

~Maintaining high rates of public investment in infrastructure, education, and health, achieved
through national savings (20–25 percent or higher) rather than borrowings.
~A balanced approach during the rural to urban transition that involves increased investments in the
agriculture sector in a predominantly rural workforce such as Indian and China.
~Protections and safety nets for people during job transitions and protecting rights of labor.
~Not to resist urbanization, but to make it more orderly and manageable
~Addressing the upper end of income distribution through taxation and appropriate spending
programs
The Asian Development Bank—the second approach of inclusive growth that has

emerged within the Asian context is that of the Asian Development Bank (ADB). ADB’s

strategy of inclusive growth is explained in a key paper, “Inclusive Growth: Toward a

Prosperous Asia: Policy Implications” (Ali and Zhuang 2007). ADB’s strategy of inclusive

growth is somewhat narrow compared to Commission on Growth and Development as it more

market-focused and business friendly. Further it gives more importance to opportunity, rather

than outcomes of inequality. In ADB’s strategy, inclusive growth is more about creating “growth

with equal opportunities” (Ali and Zhuang 2007:10). The two main pillars of ADB’s inclusive

growth strategy are: a) sustainable growth that creates and enlarges opportunities and (b)

broadening access to these opportunities to ensure that members of society can participate in and

benefit from growth. However, the ADB strategy is less redistributive in its approach and steers

away from targeting poverty directly to focus on identifying market and government failures that

36
constrain inclusive growth. Further, this strategy there is a far lesser role of the government,

whose responsibility is to develop and maintain an enabling environment for business.

The World Bank—the third approach of inclusive growth is that of the World Bank

(2009a). The World Bank approach of inclusive growth focuses on the pace and pattern of

growth. Along with sustaining rapid pace of growth which is crucial for poverty reduction, it also

focuses on its sustainability in the long run based on broad-based sectors and including large part

of the country’s labor force. Similar to ADB, the World Bank approach too is more market-

heavy and emphasizes that government’s role was to remove constraints to growth and creating a

level playing field for investment. Even the idea of equality of opportunity is discussed in terms

of access to markets, resources, and unbiased regulatory environment for businesses and

individuals. Further, discouraging income distributive schemes, it proposes that inclusive growth

should focus on long-term productive employment.

To sum up, one can summarize the main features of inclusive growth based on the three

approaches discussed above:

1. Growth is a necessary, but not a sufficient condition for human development.

2. Growth premised on inequality is unsustainable.

3. Growth is vital for poverty reduction. However, sustainable growth reduces poverty more

effectively. For growth to be sustainable it must be pro-poor.

4. Therefore, inclusive growth is not just about the pace but also the pattern of growth.

5. Increasing public investments in infrastructure, education, and health is crucial for

creating an inclusive growth.

6. Governments are key actors in facilitating sustained and inclusive growth and can ensure

that benefits of growth are widely shared.

37
 7. There is a need for providing safety nets to counter market imbalances.

8. There is a need for a long-term growth perspective that is focused on generating

productive employment rather than direct redistribution of income.

Making Urbanization Work

As discussed earlier, the urban has become a key problematic in inclusive growth with regard to

balancing growth and poverty reduction. There is a growing sense of urgency with regard to

urbanization in the developing world as highlighted by this quote from Urbanization and

Growth, a report published by the Commission on Growth and Development (2009:xvi)

Rapid and sustained growth entails rapid and sustained urbanization. But, if mishandled, the
growth of cities poses problems that can derail growth. Developing countries must accomplish in
a few decades what today’s industrialized countries achieved over a century or more” (p:xvi).
Driven by this sense of urgency, the writing on the wall is that we should “make urbanization

work” for growth and poverty reduction by, first, harnessing its potential for economic growth;

second, by managing the negative effects of economic success of cities—congestion, regional

inequality, and high prices of land and housing (Commission on Growth and Development 2009;

World Bank 2009a). The second challenge is particularly important for inclusive growth in terms

of ensuring that the benefits of growth are widely shared.

In light of the above thinking the new approach in development policy recognizes that

urbanization is not only inevitable, but is a necessary condition for economic growth and poverty

reduction (World Bank 2009a). Therefore, the idea is not to resist urbanization, but to make it

more orderly and manageable (Commission on Growth and Development 2008). This approach

is largely influenced by the fact that in the last 25 years countries that have registered a sustained

high growth of seven per cent or more have all done so through manufacturing and services

based in urban areas (Commission on Growth and Development 2008). Therefore, given the past

38
record, there can be no growth without urbanization and industrialization. Growth occurs due to

a structural shift in the economy from agriculture to urban activities. Urbanization is therefore a

“geographical corollary of industrialization” characterized by a shift of workers from their rural

farms to factories in cities (Committee on Growth and Development 2008:58). The reason why

growth gravitates in cities is because of what economists call “agglomeration economics.”

Clustering of activities together provides economies of scale and scope and easy flow of

information which are crucial for capital accumulation. Therefore, with advancement in

technology and globalization and financialization of markets, “global cities” have become

centers of this agglomerative growth (Sassen 1991; 2001). For example, in 2005, the largest 100

cities in the world accounted for 25 per cent of global GDP, while the top 30 cities together

accounted for around 16 per cent of world GDP (PricewaterhouseCoopers 2007).

However, the process of urbanization is rarely smooth, as infrastructure and public

services often fail to meet the needs of an increasing urban population. Further, economic

success of cities in predominantly rural societies such as India and China has led to glaring

income and regional disparities, which in the long-run is detrimental to growth. Therefore, along

with growth, it is imperative to manage the extent of inequality.

Urbanization is a particularly important challenge for the developing world. In 2008, for

the first time in human history, the urban population of the world surpassed the rural. In the next

two decades, it is projected that another two billion people would move to the cities and 90 per

cent of this urban population growth is expected to occur in the developing world. Due to the

emergence of the new geography of trade the locus of urban restructuring has shifted to the large

and expanding metropolises of Asia, Latin America, and parts of Africa; which are becoming the

“production hearths of the new globalism” (Smith 2002: 436). In this context, multilateral aid

39
agencies such as the World Bank and the International Monetary Fund (IMF) have increasingly

focused their attention on cities as “engines of growth” and have channeled their efforts into

improving the infrastructure in cities in order to facilitate growth (World Bank 1994).

In 2010, the World Bank announced a “new global urban strategy” for cities in the

developing world that focuses on “harnessing urbanization for growth and poverty reduction

(World Bank 2009a). At the launch of this new urban strategy, the then President of the World

Bank Robert Zoellick announced that “urbanization is a vital phase of development, and if

managed well, it can be a key driver of long-term economic growth in a country. Climate

change, jobs, poverty, education, health, infrastructure—these are all development challenges

closely intertwined with cities.” The new World Bank approach of “managed urbanization”

involves the following features: more intervention from the national state in cities in critical

policy areas such as land and housing markets; updating planning regulations to absorb new

residents; fostering agglomeration benefits to enhance growth and poverty reduction; and a focus

on secondary cities which are urbanizing very rapidly. Specifically in terms of urban economic

growth the Bank recommends increasing focus on city management, finance, and governance;

pro-poor policies to target urban poverty and slum upgradation; a progressive urban land and

housing market; and a safe and sustainable environment (World Bank 2009a).

Growth and Urbanization in India

India has witnessed a remarkable growth in the last few decades making it one of the fastest

growing economies in the world. For the first three decades following independence in 1947,

India’s growth rate remained rather sluggish at around 3-4 per cent per annum (Kohli 2006;

Government of India 2009) which came to be referred to as the “Hindu rate of growth.”

However, there was a marked acceleration in India’s growth rate which increased to 5.6 per cent

40
per annum during the period 1980-2004 (Nayyar 2006). The growth rate further accelerated in

the 2000s. During the Tenth Plan period (2002-03 to 2006-07), India achieved an average growth

rate of 7.8 per cent per annum. The financial crisis dented India’s growth in the next plan period

(2007-08 to 2011-12), declining to 6.8 per cent for the year 2008-09. The economy recovered to

register 8 and 8.6 per cent in the next two years (Ahluwalia 2011). However, in last two years the

growth has slowed down the cause of which is attributed to strong inflationary trends and a

slowdown in the global economy. In 2011-12 it decline to 6.2 per cent and even further to 5.0 in

2012-13. Nonetheless, if you look at the combined annual growth rate for the decade ending in

2012-13 it remained an impressive 7.9 per cent (Government of India 2013:1).

There is a debate about the timing of India’s high growth “take-off.” On the one hand,

some scholars emphasize that the widespread economic reforms introduced in 1991 contributed

to India’s subsequent high growth (Ahluwalia 2002; Srinivasan and Tendulkar 2003; Panagriya

2004). On the other hand, there are other scholars who argue that there a “surge” in India’s

growth actually occurred a decade prior to the formal inauguration of reforms in 1991, where the

growth rate actually doubled (De Long 2002; Kohli 2006; Rodrik and Subramanian 2004;

Virmani 2004). According to these scholars, the real structural break from the “Hindu rate of

growth” actually occurred in 1980 and India’s growth rate in the decade 1980-81 to 1990-91

increased to 5.5 per cent per annum from 3.5 per cent per annum during the earlier three decades

(1950-51 to 1979-80) (Nayyar 2006). Some even argue that the India’s growth performance

cannot be attributed to economic liberalization at all. Nayyar (2006), using a long-term historical

perspective that takes into account the “long-twentieth century,” argues that the turning point in

India’s economic growth actually took place in 1951, when India’s growth improved

significantly from the past and it was respectable compared to the performance of other countries

41
at that time. Nayyar (2006) attributes this turn around in performance in the 1950s to the birth of

political democracy and the mediating role played by the state between economic and social

development. Therefore, changes introduced in the 1950s were far more significant in

comparison to changes in the 1990s as 1950s marked a change in both the economic and political

landscape of the country. Nayyar (2006) does admit that the changes introduced in 1990s were

also significant as it marked a shift in the development approach of the country from

redistribution and concerns of equity to pursuit of growth. However, according to him the initial

conditions for growth were laid in the three decades preceding reforms due to the importance

given to higher education, science and technology, other institutional capacities.

However, as pointed out earlier, some scholars argue that the momentum of India’s

growth was created a decade prior to 1991 (De Long 2002; Kohli 2006; Rodrik and Subramanian

2004; Virmani 2004). In this context, it is argued that it was at that time that a nascent “growth

first” strategy was created in India by the then Prime Minister Indira Gandhi which marked a

shift from the earlier Nehruvian socialist model of distributive justice to growth (Kohli 2006;

Rodrik and Subramanian 2004). According to Rodrik and Subramanian (2004:4), growth first

“unleashed the animal spirits of the Indian private sector in the early 1980s due to an attitudinal

shift in the national government that favored private business marking a shift in the rhetoric of

Garibi Hatao (eradicate poverty) to growth. There are several factors cited for this shift toward a

pro-growth alliance of state and business. According to Kohli (2006:1255), the combined effect

of failure of anti-poverty programs; ineffective socialism that prevented growth; success of the

green revolution in the 1960s led by private producers; and a poorly performing public sector,

created an atmosphere in which the private sector seemed like a natural ally for growth.

However, the nature of these reforms did not confirm to the path prescribed by the “Washington

42
consensus.” Rodrik and Subramanian (2004) make a distinction between a “pro-market” and a

“pro-business” model. Unlike, the pro-market reforms which was premised on the free market

and competition that supported new entrants and consumers, the pro-business reforms introduced

in India were closer to the East Asian model of development that involved a highly

interventionist state that relied on indigenous businesses in promoting economic growth and

which selectively linking their economies to the world (Rodrik and Subramanian 2004; Kohli

2006). This new growth strategy provided several benefits to big businesses such as tax benefits,

removing earlier licensing restrictions by diluting the Monopolies and Restrictive Trade

Practices Act (MRTP), introducing a special legislation that discouraged strikes (Kohli 2006).

As a result of the new growth strategy by Indira Gandhi (and later her son Rajiv Gandhi),

the 1980s saw a substantial improvement in rates of investment and growth rate (especially in

Industry) as well as growth of private sector in the Indian economy.30 India adopted a wider set

of reforms in 1991 that included further delicensing of the private sector, removal of MRTP

restrictions, tax concessions to big business, and labor reforms (Kohli 2006:1363).31 Due to

external factors such as the second petroleum price hike in 1981 that increased India’s import

costs significantly, India entered into a loan agreement with the IMF for almost $ 5 billion in

1981 to avoid a foreign exchange crunch. As a result of this, India also had to obey certain IMF

structural adjustment prescriptions such as reducing social and public spending to cut the

budgetary deficit. However, India’s opening up of economy remains fairly modest, compared to

this the internal deregulation has been faster (Kohli 2006).

The Indian growth story has been one of high GDP growth, but primarily driven by the

growth in the service sector. Not all sectors of the economy have grown at the same pace as is

30
Along with the established big business such as Tata and Birla, the pro-business strategy also enabled newer
companies such as Reliance to grow powerful.
31
For more details on the 1991 reforms see Jenkins (1999).

43
reflected in the relatively low agricultural growth rate, low-quality employment, poor education,

inadequate healthcare services, rural-urban divide, social inequalities, and regional disparities

(Kumar 2009). The Indian government too has officially recognized that growth has not been

equitable and has left out certain states, regions, and people (Government of India 2009). The

percentage of the population below the official poverty line has come down from 36 per cent in

1993–94 to 28 per cent in 2004–05. However, it is still high and its rate of decline has not

accelerated along with the growth in GDP. Poverty among certain marginalized groups, for

example the Scheduled Tribes (STs) has remained unaffected. Illiteracy still is still a big

problem, with almost 304 million people, making India the country with the highest number of

illiterate people in the world. Further, growth rate in agriculture has slowed down since the late

1990s, leading to growing rural-urban divide and severe distress in rural areas in some regions

(Planning Commission, Government of India 2008a:1). The most glaring proof of increasing

inequality in India is the alarming increase in farmers’ suicides in India (Vaidyanathan 2006).

According to national statistics, there were 270,940 farm suicides in India since 1995 is

270,940.32 Inequality in urban areas too has increased since mid-2000s and remained higher than

rural areas during 1950-2000 (Weisskopf 2011). Growth has benefitted city-dwellers more than

their rural counterparts. Further, studies have also found that the pro-reform growth has had a

pro-rich bias which is more striking in the urban areas than the rural areas (Sarkar and Mehta

2010). The post-reform growth has also been anti-poor, as highlighted by a study which found

that the per capita consumption by the urban poor increased only half as much as the per capita

national average rate of growth of consumer expenditure (Sen and Himanshu 2004). After taking

stock of India’s growth experience, I will now focus on its urban component, which is becoming

increasingly important to sustain the growth momentum

32
P. Sainath, “Farm suicides rise in Maharashtra, State still leads the list,” The Hindu, July 3, 2012.

44
The urban context of growth in India

It is argued that cities are going to be extremely crucial for India’s future growth. Although,

India’s share of urban population remains small due to the relatively slow pace of urbanization

(28 per cent of the total population), the urban share of India’s growth has steadily increased. For

example, the contribution of the urban sector to India’s GDP has increased from 29 per cent in

1950–51 to 47 per cent in 1980–81. Currently, the urban sector contributes to 62–63 per cent of

India’s GDP and this is expected to increase to 75 per cent by 2021 (Planning Commission,

Government of India 2008b:394). With the increasing share of urban growth, India’s pace of

urbanization is also set to increase. It is projected that India’s urban population will increase

from 340 million in 2008 to 590 million in 2030 (40 per cent of India’s total population). Most

urban population is concentrated in India’s large cities. Cities with population over 100,000

account for 68.9 per cent of the urban population and this share has been growing (Planning

Commission, Government of India 2008b:394).

However, this urban-led growth has not been inclusive. Urban poverty remains high in

India. Although the share of the urban poor in the urban population has fallen, there has been an

increase in the absolute number of urban poor. India-Urban Poverty Report 2009—a report

brought out by the Ministry of Housing and Urban Poverty Alleviation of India, supported by the

United Nations Development Program (UNDP) and the first of its kind in India—highlights

some interesting findings which are worth looking at length:

~25 per cent of the people in urban areas (over 80 million people) live in poverty and about 61.80
million people were living in slums.
~There is an “urbanization of poverty” in India reflected by the fact that most States in India
reported higher incidence of poverty in urban areas than rural areas, although at the national level
rural poverty is higher.

45
 ~The incidence of decline of urban poverty has not accelerated with GDP growth. The report
explicitly states that “a substantial portion of the benefits provided by public agencies are
cornered by middle and upper income households” while 54.71 per cent of urban slums do not
even have access to toilets.
~Therefore, the report warns that “urban poverty will become a major challenge for policymakers
in our country as the urban population in the country is growing, so is urban poverty.” The report
points out that urban poverty is related to several other problems such as housing and shelter,
water, sanitation, health, education, social security and livelihoods, and also to the special needs
of vulnerable groups like women, children, and the aged.
~There has been an increase in migration in India and that poverty incidence was higher among
rural to urban migrants. This shows that economic reforms in India have not been able to create
much employment opportunities in small and medium towns and in rural areas.
Despite these pressing urban problems, the policy focus on urban areas has been relatively

modest. Urban development remains a state subject, but is heavily determined by central

intervention. Planning in India has always centered on the rural sector due to political

considerations, and in the initial three decades after independence the approach toward the urban

sector remained ad-hoc and piecemeal (Government of India 2009; Sharma and Shaban 2006).

This has mainly contributed to the haphazard growth of Indian cities. It was only during the

Seventh Five Year Plan (1985-90) that for the first time the process of urbanization was viewed

as part of larger economic development. To strengthen this view, the First National Commission

on Urbanization was set up in 1986, which recognized the role played by cities in economic

development. According to the Commission, cities such as Mumbai, “have been generators of

national wealth and, if they were to collapse, the economy would receive a grievous body

blow…the Commission feels that it is a matter of top most national priority to not only save the

national cities but to help them revive their economies.”

It is not a matter of coincidence that increasing attention on urban development happened

at around the same time when the “growth first” strategy was adopted by the Indian government

46
in the early 1980s. This view of “cities in economic development” was further reiterated in the

economic reforms in the 1990s. In 1992, India introduced political reforms of decentralized

planning and devolution of power under the 74th Constitutional Amendment Act. These reforms

were initiated to create a more participative and decentralized planning process in which cities

would have the necessary autonomy for planning and governance. As part of political

decentralization, ward committees were to be established in municipalities with a population of

more than 300,000. It was also recommended to set up Metropolitan Planning Committees and

District Planning Committees. However, only a few large municipal bodies benefited with this as

most local bodies lacked the necessary capabilities to generate own funds (Sengupta 2006).

As pointed out earlier, the introduction of economic reforms in the 1990s and increasing

role of market-driven development reinforced the role of large cities where most of the economic

activity has concentrated, leading to the neglect of small and medium cities. For example, eight

largest million-plus cities in India account for over one-third of total bank deposits, over 50 per

cent of bank credit, and one-third of the FDI (Sharma and Shaban 2006). To illustrate this

imbalanced urban development further, let us take the example of Mumbai, the subject of this

study. Over one-third of the total urban population of Maharashtra State is concentrated in the

Mumbai region alone. Further, half of the “net share in domestic product” of the state comes

from two industrial belts of which Mumbai is one (Sharma and Shabhan 2006).

In recent times, development planning in India has given importance to inclusive urban

development. The Eleventh Five Year plan recognizes that rapid economic growth will

inevitably lead to an increase in urbanization based on large economies of agglomeration

provided by cities. In this context, the biggest obstacle for rapid growth is inadequate urban

infrastructure. However, in creating new urban infrastructure, the plan puts emphasis on equity

47
and inclusiveness. The plan talks about creating a distributive model of urbanization that would

ensure that migration flows do not concentrate in any particular city or cities (Planning

Commission, Government of India 2011b:400).

To improve urban infrastructure and the quality of life the Indian government launched

one of the most ambitious urban renewal programs in the country in 2005 called the Jawaharlal

Nehru National Urban Renewal Mission (JNNURM) for the integrated development of urban

infrastructure and services in 63 cities across India. Around Rs. 50,000 crore of reform-linked

central assistance was to be provided under this scheme over a period of seven years. However,

Kundu (2011:12) criticizes this mission for perpetuating “exclusionary urbanization” which he

describes as “the indecision or purposive ambiguity in the Plan and policy linked documents

concerning urban development [that] has deprived the small and medium towns of the resources

badly required for providing critical infrastructure and services” and expresses a need for a more

spatially distributed model of urban development (Kundu 2011). The finance generation for

funding infrastructure is based on generating revenue through external borrowing, public-private

partnerships, and through financial instruments such as bonds. However, small and medium

towns face a severe handicap in this regard. Kundu and Samanta (2011:62-63) highlight that only

58 per cent of the urban population has been covered under the JNNURM and that too within

more developed states and metropolitan cities. Further, within the JNNURM “there is greater

bias on improving the efficiency in the functioning of the overall city economy and meeting the

infrastructural deficiencies at the macro-level rather than addressing the issues of distributional

inadequacy and improving the access of the poor to these (Cited in Mahadevia 2011:57).

Recently the approach of inclusive growth in India has been questioned on grounds of

lacking a clear vision and strategy (Oommen 2011; Suryanarayana 2008). The draft Twelfth Five

48
Year Plan acknowledges that “to achieve inclusiveness…requires multiple interventions, and

success depends not only on introducing new policies and government programs, but on

institutional and attitudinal changes” (Planning Commission, Government of India 2011:5,

emphasis added). However, there is no systematic reform strategy offered, other than a few

staple government programs. In this regard, Oommen (2011) points out that India’s vision of

inclusive growth treats growth and inclusiveness as separate. In this regard, Oommen (2011:159)

states that “inclusiveness is not a mitigating act, but a strategy of participation in the social

production (growth) process and settlement of claims on the product on a fair basis.”

Having highlighted the crucial relationship between inclusive growth and urbanization, in

the next chapter I analyze the development of Bombay as a “colonial port city.” I focus on key

historical processes that inform Mumbai’s contemporary unequal urban context. As highlighted

earlier, high initial conditions of inequality slows down the pace of poverty reduction, therefore,

our contemporary analysis of urban development needs to be informed by the historical

processes that produce inequalities (Birdsall 2004).

49
 CHAPTER 2

AN UNEQUAL CITY: THE MAKING OF BOMBAY/MUMBAI

~I will not claim to possess the prophetic insight to foresee what is in store for Bombay. But as it
has adopted the happy motto of Urbs prima in Indis, it may be hoped that this will prove of good
augury, and that among other privileges Bombay will own that of priority among the Indian cities
for longevity in undecaying prosperity (da Cunha [1900] 2004:6).

~Urban landscapes come to refract various layers of sedimentation—of past uses and
organization—as well as to embody a range of possible meanings and actions falling outside the
shifting levels of specification brought to bear on these landscapes by the prevailing and….often
fragmentary apparatuses of control (Simone 2004:14).

Any contemporary attempts of redevelopment of Mumbai (as discussed in the subsequent

chapters) reflect, as well as confront, the seemingly insurmountable challenges posed by the

existing inequalities in the city. These inequalities are not just found within the city, but are also

seen regionally in terms of how cities emerged historically as privileged sites of concentrated

economic activity and investment in India. Therefore, for a deeper understanding of

contemporary urban redevelopment in Mumbai, we need to examine the long-term historical

factors that shaped the city. The new urban experiments are not introduced tabula rasa in the

city, but jostle with inherited institutional frameworks, patterns of socio-spatial development, and

power geometries.

Cities and Longue Durée Globalization

One of the key features of the contemporary phase of globalization is the re-emergence of cities

as central nodes in the world economy.33 Therefore, it is increasingly recognized that

urbanization can no longer be understood solely on the basis of the political economy of regions

33
The emphasis on the term “re-emergence” is to highlight the fact that if one takes into account a longer historical
approach of understanding globalization, cities have remained key sites that articulated cross-cultural exchanges.

50
or within the boundaries of nation states and there is a need for an “analytic disarticulation of

cities and nations” (Davis 2005:97). The world systems theory provides a key analytical frame to

understand how processes of urbanization were connected to structural changes in the world

economy (Braudel 1986; Wallerstein 1994; 2004). Influenced by such an approach, the “world

city” (Friedmann ([1986] 1995) and the “global city” (Sassen 1991; 2001) have emerged as key

concepts informing the discussion of cities and contemporary globalization. However, the

dominant world/global city paradigm has ignored the long-term historical context within which

cities articulated the relationship between the global and the local and therefore exaggerate the

historical uniqueness of contemporary urban transformations.

Scholars advocating a longue durée globalization approach have documented that cities,

as key “nodes,” were engaged in wider circuits of production, exchange, and culture throughout

history (Abu-Lughod 1989; Arigghi 1994; Braudel 1986; Brenner 2001; Gills and Thompson

2006; King 1990). According to Brenner (2001:127), the longue durée historical analysis

resuscitates “standard interpretations of contemporary urban restructuring in the broad

geohistorical context of earlier rounds of globally induced transformations within each city.”

Doing this enables us to understand how certain locally specific factors, processes, and

developments have enabled cities to acquire certain world city functions in the contemporary

context. Therefore, rather than understanding global forces as macro structural background

conditions, the long-term historical perspective incorporates a “path dependent” analysis in

which earlier historical events provide a causal context for subsequent development (Brenner

2001:127-8).

Employing such a long-term globalization perspective, this chapter tries to historicize the

contemporary self-conscious project of globalizing Mumbai. I will do this through a path-

51
dependent analysis of the development of the city that takes into account the local specificity of

the place. For this I will use two analytical frames: Bombay/Mumbai as a “port city” and as a

“colonial city.” The first analytical frame emphasizes the dimension of human interconnectivity

primarily through trade and the evolution of port cities as key nodes in these trade networks

(Rennstich 2006). Although contemporary globalization makes the world more interconnected,

the interconnected world is also segmented in many ways. Therefore, the second frame of

“colonial city” stresses on the unequal nature of power and highlights how contemporary

inequalities in Mumbai were historically produced through colonial urban development which

primarily served the interests of the colonial elite (King 1976).

Port cities and maritime trade networks

Rennstich’s (2006) longue durée approach understands globalization as an “evolutionary process

in the making for an extended period of human history rather than a unique occurrence that

started in the latter part of the twentieth century” (p.185). Each new long wave of global change

builds upon past patterns of change and is carried forward through an “evolutionary logic” driven

by human agency through the innovative use of resources, thereby strengthening the “global

layers of interactions” (Rennstich 2006:184-85). In the evolution of the global system from land

to maritime trade, port-centered world cities began to play an increasingly important role as

“nodes” that externalized socio-economic and political networks. However, this evolutionary

logic of change does not have a linear dynamic in terms of a constantly increasing level of global

interaction. This historical evolution is marked by periods of “punctuation” brought about by

political and military obstruction of trade that alters certain path-dependent tendencies resulting

in the system becoming internally oriented until a new phase of externally-oriented evolutionary

dynamic sets in. According to this model, it was around 900 CE that the modern era of

52
globalization began, driven by the expansion of maritime trade by Sung China.34 This

externalizing tendency was punctuated at around 1850 with the introduction of a relatively

internal-oriented industrial system. With the growth of digital technologies in recent years, there

is a re-emergence of an externally-oriented global system, the momentum for which was set in

the late twentieth century through a transformation in the communication technologies through

the invention of the telephone, typewriters, and electrical telegraph (Rennstich 2006:197).

The world city system also evolved by adapting to military and political “blockages” that

disrupted existing trade networks, giving rise to new connections and nodes and also to new

systems. Rennstich identifies five such blockages in the evolution of the world system. The first

two blockages led to a change in trade from land-based Silk Road system to a maritime-based

Spice Route system, leading to importance of port cities such as Rome and Alexandria. The next

two blockages led to a shift from the preindustrial Silk Route to an industrial Atlantic system,

leading to the increasing importance of cities such as Canton, Cairo, Genoa, Venice, and later

Lisbon, Seville, Amsterdam, and London. Finally, the fifth blockage marked a transition to an

information-based system based on digital communication, leading to the importance of cities

such as New York, San Francisco, London, Tokyo, and Seoul (Rennstich 2006:189).35 Thus,

Rennstich (2006) finds that broadly there have been three distinct network systems in the modern

global system: the commercial maritime system, the industrial production system, and the

34
Rennstich (2006) argues that period is crucial as it laid out the “preconditions” for the development of the modern
era of globalization characterized by more global networks based on innovations in communication (printing,
oceanic travel), military technology (e.g. gunpowder) and trade (e.g. media of exchange). This expansion of global
networks was led by Sung China through a commercial maritime system which was only later developed more fully
by the European empires (pp. 190-91).
35
The first blockage appeared when Parthia blocked the Silk Roads in 25 BCE, leading to Romans taking the Sea
route. During the second blockage, Persia blocked Byzantium in 550 CE, leading to an alternative land-based route.
The third blockage was due to the Northern tribes in China at around 800-1100 CE during which the Sung dynasty
expanded the earlier maritime. During the fourth blockage, the Muslim powers blocked Europe in 1400-1500 CE
leading to Europeans finding the Cape route and crossing the Atlantic. Finally, the fifth blockage occurred around
1850 CE when Britain was blocked by other colonial powers leading to independent communication networks by
the UK and the US (Rennstich 2006: Table 11.2, p. 189).

53
emerging digital commercial system. Both the commercial maritime and digital system displayed

more external network relations, whereas the industrial phase was more internally oriented. In

terms of the path-dependent analysis of the development of the modern global system, Rennstich

(2006) describes a “three-step” path-dependent evolution of the global system in which the

Phoenician maritime commercial system contributed to the growth of a global maritime external

commercial system which is now currently being transformed into an external network system

based on digital communication. According to Rennstich (2006), the Phoenician network system

(1100 BCE-850 BCE) centered on current regions of Lebanon and Syria, was the first truly

transcontinental system based on maritime nodes of world cities in three different continents.

This led to the emergence of cities such as Byblos, Tyre, and Arward with the larger Assyrian

Empire. Later these maritime links were widened by maritime powers of Portugal, the

Netherlands, and England. Through the voyage of Vasco da Gama in 1497-99, the Portuguese

were able to link the Asian maritime trade with the Atlantic. During the seventeenth century the

Dutch, along with the trade with the East, were engaged in an Atlantic triangular trade between

Europe, Africa, and the Americas, which was later contested and extended by England after 1650

through trade in mass-consumed goods, as a result of which London emerged as the major

financial node in the world economy. The emerging digital system marks a return to an

externally oriented network system replacing the internally-oriented industrial system in place

since mid-nineteenth century. It is precisely its digital nature and the possibilities it opens up that

differentiate it from the previous external network system. This new system which is based on

the use of digital technologies powered by the internet, enables much deeper and integration and

a much wider impact in terms of facilitating organization and institutional changes. The United

States due to its wider reach of digital infrastructure is a central node in this new information

54
system with other countries linked to the US. It is in this context that the current re-emergence of

cities (“global cities”) as important nodes that articulate transnational flows of goods, capital,

and people is to be understood.

The colonial city and unequal urban development

The above discussion on nodes and networks helps us in understanding the historical evolution

of contemporary “global cities,” thereby problematizing the supposed novelty of some of the

discussion on contemporary urbanization. However, the main drawback of such network-based

analysis is that it does not adequately focus on the role of power and ideology in shaping global

change. Even though Rennstich (2006) acknowledges the role of human agency in driving global

systemic change, the agency is assumed to be power-neutral. In this context, the analytic of the

“colonial city” is more suitable in understanding the historical role of power in shaping

contemporary inequalities in postcolonial cities such as Bombay/Mumbai.

According to (King 1976:7), a “colonial city” is “that urban area in the colonial society

most typically characterized by the physical segregation of its ethnic, social, and cultural

component groups, which resulted from the processes of colonialism.” Therefore, King

(1976:18, emphasis added) prefers to use the term “urban development” rather than “urban

growth” to underscore the importance of understanding urban change as a planned and directed

process. King (1976:24) argues that colonial planning represents an attempt of colonial powers

to experiment many of the planning theories in the colonial societies before they were adopted

by their own governments in the metropolitan society. King further asserts that it was in the

particular context of colonial India, between the eighteenth and twentieth century, that the

“modern,” industrial phase of colonial urbanization was introduced. According to King (1976),

culture, economic-technological order and the power structure are the three basic components of

55
colonialism. Therefore, in the specific context of British colonialism, King (1976) understood the

impact of colonialism on urban development in the colonial society as being typically Western

(culturally British), capitalist-industrial (economic-technological order) and colonial (power

structure). Castells (1972) used the term “dependent urbanization” to characterize the

relationship between the colonial city and the metropolitan economy. The urbanization of the

colonial society was dependent upon the industrialization of the metropolitan society or as

Simone (2004:139) puts it, it was in context of an “enforced engagement with the European

world.” This engagement disrupted traditional market structures and the colonial city, segregated

from its hinterland, was employed in the service of the metropolitan economy. This dominance-

dependence relationship is also seen at the city level where there was a clear demarcation

between the native and the European parts of the city, where the European quarter was dependent

on the labor of the native quarter. This segregation between the two sectors is observed in

architectural landscapes of postcolonial cities and the term “dual city” is used to describe this

legacy (Abu-Lughod 1965). Even in terms of provision of services, amenities such as roads,

recreational space, water, electricity lines, sewers, housing, shopping and hotels, were all

concentrated in the European sector. In contrast to this, there was severe neglect and

underinvestment in the native quarters of the colonial city (King 1976:282).

Scholars have used the term “unintended city” to describe the invisible, nonetheless vital,

dependence of the urban elites on the poor.36 Simone (2004) argues that the historical legacy of

this dependency can be observed in postcolonial contexts characterized by the vestiges of the

colonial state and the urban elite, whose values are culturally similar to that of the metropolitan

past. Simone (2004:280) further argues that in the contemporary context, this transfer of

36
The term “unintended city,” originally used by Jai Sen (1976), has been used by Ashis Nandy (1998:2) to describe
the world of the urban poor as a city “that was never a part of the formal ‘master plan’ but always implicit in it.”

56
metropolitan values continues through various “development models,” whereby, “cultural

categories are assumed to be universal,” giving rise to “new modes of dependence” through the

transfer of development “models” and “techniques.”

Colonialism not only shaped a particular nature of urban development, but also led to

larger structural and organizational changes in the systems of production, governance, and

knowledge production. As Simone (2001) observes in the case of Africa, the colonial project of

urbanization involved a kind of “remaking” of precolonial cultures in a by and large rural

continent and “cities would act instrumentally on African bodies and social formations” (p.18).

Simone further argues that this urbanization set the framework within which Africans began to

relate with each other within cities, as well as how they interacted with the outside world. He

states: “the present emphases on decentralization, local management, the exigencies of poverty

alleviation, and regionally articulated local economic development are all in significant ways a

reformulation of instruments used to evolve urban life according to the conditions that would

ensure a very specific engagement with nonlocal worlds” (Simone 2001:19). Much of what

constitutes as informal economies in most of the postcolonial cities in the South are a product of

colonial economies and the constant migration of people to cities. Cities were seen a “places of

refuge” (Simone 2004:20) to the multitude of people displaced from rural areas as a result of the

colonial economy.

However, it is argued that the colonial structure remained fragmented and there were

limits to the control it had over the urban environment. In Simone’s (2004:143) words,

“throughout the colonial project, control was always tentative, constrained, and contested.” This

fragmentary structure provided opportunities for ordinary urban residents to make claims on the

cities. It is in this space of the “unintended city” that alternative practices were enacted by

57
identifying existing loop holes and underregulated spaces in a context of extreme scarcity of

material resources and basic infrastructure. Therefore, as Simone argues the colonial city also

provided the space for “a constant renegotiation of alternative spaces of livelihoods, relations and

practices…a project of making something out of the city other than what was expected in

capitalist production…allowing people to urbanize relationships derived from ruralized

solidarity” (Simone 2001:20).37

The Making of Bombay/Mumbai: Connections and Disconnections

A colonial port city

Bombay like some of the other big cities of India, such as Kolkata and Chennai, is a colonial

city. However, unlike some of the other cities of the subcontinent such as Delhi, Agra, Lahore,

Varanasi, Hyderabad, or Ahmedabad it has a relatively short history of urban settlement (Patel

2003, emphasis added).38 Even though Thana, the region north of Bombay, is noted in some

accounts of Marco Polo, the Portuguese who occupied several islands in the region after 1532

did not consider Bombay of much strategic importance, unlike Goa or Calicut (Kooiman 1985).39

Precolonial trade—Despite Bombay’s relatively recent urban origins, Bombay’s growth

as a port city during the British expansion in the nineteenth century has to be understood in a
37
In the context of Bombay, Chandavarkar (1994) has highlighted how these rural solidarities helped the textile
workers of Bombay in their struggle for survival in the city. He also points out that these links with their rural bases
also allowed the workers to wage militant struggles in the city.
38
Kolkata and Chennai are the new official names for Calcutta and Madras. The word Bombay was a corrupted
Portuguese usage of the island’s indigenous name derived from Mumbadevi a patron goddess of the Kolis (the
indigenous people of the region). Although Bombay has widely been understood as a “colonial port city,” some
scholars are not comfortable using this category. Chandavarkar (2004) contends that “even though Bombay was in
part a product of its imperial connection and owes it origin and early growth to the colonial settlement, its
commercial and industrial development was shaped increasingly and in important ways by its place within the
internal economy” (p.29, own italics). In this internal economy the commodity markets were linked to wider
relations of production and exchange in the hinterland. The textile mills of Bombay depended increasingly on the
penetration of the domestic market. Thus, the growth of Bombay does not owe solely to the colonial logic of
development, but on the dialectics of global forces and regional/local processes, an argument made by several
scholars with regard to other Indian cities (King 2004).
39
The earliest archaeological evidence suggests that the region around Bombay had precolonial trade connections
with Persia and Rome. It is also speculated that Ptolemaeus’s Heptanesia (Seven Islands) may have been identified
as the seven islands of Bombay. However, this period preceding the European expansion was considered to be of
minor importance in its growth (Kooiman 1985).

58
much earlier historical context of adaptation and expansion of maritime networks of trade and

cultural exchange in the Indian Ocean region. Recently, scholars have argued that today’s

emerging “Asian connections” need to be understood in a much longer history going as far back

as the thirteenth century precolonial maritime networks in the regions extending from the Red

Sea to the South China sea (Duara 2010:965).40 The later European colonial trade and power

expanded and built upon these older precolonial networks of mobile merchant communities of

Asia constituted by the Chinese, Indian, and (Baghdadi) Jews, involved in long-distance credit

networks.41 Chaudhuri (1985) argues, “India” in the precolonial period provided a vital junction

point to three different networks of trade and civilization: “the first linking its West coast to

Arabia and Levant; the second its North-West to Central Asia and Iran; and the third it’s South-

East to South-East Asia.”42 Washbrook (1997) argues that until the sixteenth century, Europeans

played a marginal role in this Asian world dominated by the Ottomans, the Mughals, the Ming

and the Ch’ing (p.426).

European expansion--From the sixteenth century, beginning with the voyage of Vasco da

Gama in 1497-99 and the subsequent linking of the Asian maritime trade with the Atlantic by the

Portuguese (and its later expansion by the British through trade in mass-consumed goods), the

European powers began to dominate these precolonial trade networks through imperialism

(Rennstich 2006). Duara (2010:964) argues that the British Empire in the nineteenth century

“had the effect of intensifying some of the old relationships and generating new linkages

between cities (and hinterlands) of Aden, Bombay, Calcutta, Singapore, Hong Kong, and

Shanghai as entrepôts and financial centers for Asian trade” (Duara 2010:964).

40
Sen (2010) extends these Asian precolonial networks even further back in history to the first century to trading
networks consisting of both overland and maritime routes. According to Sen (2010) by the first century the major
ports and urban centers of Asia were linked with each other (p.992).
41
For more on precolonial Asian networks refer to the seminal study on the subject by K. N. Chaudhuri (1990).
42
Cited in Washbrook (1997:426).

59
 Bombay was one of the twenty-five islands along the Konkan coast of western India (da

Cunha [1900] 2004). Six other islands were united together with the island of Bombay through

land reclamations to form a larger entity called Bombay. Bombay was transferred by the

Portuguese to the British in 1661 as part of a dowry of Princess Katherine.43 Even by the late

eighteenth century, Bombay was essentially a marine post with very few linkages with its

hinterland. However, Bombay possessed several promising geographical advantages that led to

its emergence as India’s leading port city in the nineteenth century. It possessed a safe natural

harbor that suited the maritime interests of the British East India Company (EIC) (Koiiman

1985). It was under the British Empire that Bombay emerged as an urban center.

As discussed earlier, King (1976:18) has argued that colonial urbanism has to be

understood in terms of urban development as opposed to urban growth. This fact is especially

relevant in the case of Bombay. Even though it possessed a natural geographical advantage as a

port, Bombay’s rise to prominence as a port city was not inevitable. Apart from harsh living

conditions on the island itself, Bombay was also inaccessible to its hinterland as it was

surrounded by the mountainous topography of the Western Ghats, preventing formation of land-

routes. Thus Bombay’s emergence as a port city has not only to do with its global linkages in the

world economy, but also with its local linkages with its own hinterland. In this context, Kooiman

(1985: 212) argues, that Bombay’s history confirmed the general trend that port cities only grew

after their surrounding countryside was commercialized. As a result of Bombay’s inaccessibility,

much of the trade along the western coast was restricted in the Gulf of Khambat, north of

Bombay, in places such as Khambat, Bharuch, Daman, and Diu, and more importantly Surat,

which was the major port along the western coast in the seventeenth and early eighteenth

43
Even at the time of the transfer, Bombay was of minor importance and was considered “notoriously unhealthy”
and thinly populated. It seems, Charles II was more “embarrassed than pleased by this part of the dowry” and
therefore handed it to the East India Company at an annual rent of ₤ 10 in gold (Kooiman 1985).

60
century. Surat had been a major trading site of the Mughal Empire connected with the Persian

Gulf, the Red Sea, and regions beyond Cape Comorin. In the seventeenth century, Surat

possessed the largest merchant fleet in the Indian Ocean. Moreover, Surat was also an important

connection point for pilgrims going to Mecca (Kooiman 1985:21). The Mughal Emperor allowed

certain European companies to set up their own factories. The British EIC set up a factory in

Surat in 1612 after obtaining a license from the Mughal Emperor and since then much of its trade

in the seventeenth century was centered in Surat. The Dutch and the French Companies too

followed later (Kosambi 1993:211-12).

However, toward the middle of the eighteenth century, Surat’s importance as a port had

declined and it was later replaced by Bombay as the leading port along the west coast. However,

historians argue that Bombay’s rise as a port city after Surat’s decline was not a given,

considering its inaccessibility with its hinterland. Thus, although the shift from Surat to Bombay

occurred in 1687, it was not until the mid-eighteenth century that Bombay became commercially

bigger than Surat (Kosambi 1993:212). Surat’s decline and Bombay’s subsequent rise have to be

understood in the broader world-historical changes at that time.

Das Gupta (1979) argues that the decline of Surat was affected by the declining influence

of three empires: the Mughal Empire in India, the Safavid Empire in Iran, and the Ottoman

Empire in West Asia. This historical juncture acted as a key “blockage” (to use Rennstich’s

[2006] phrase) that led the decline of Surat and reconfiguration of the trading networks in the

region. The weakening of the Saffavid and Ottoman empires disrupted Surat’s trade with West

Asia and the decline of the Mughal Empire affected Surat’s long-distance trade with Agra,

Lahore, and Banaras. Thus, as argued by Farooqui (2006:5), the decline was Surat was a “part of

a general crisis in western Indian trade” leading to Surat’s declining trade with Europe (Farooqui

61
2006:5). Along with these changes, there were also local strategic reasons for the British EIC to

consider a move from Surat to an alternative coastal site along the western coast. The company

was becoming weary of competition from rival European mercantile companies, moreover, it

was also looking for a more secure location especially after its wars with the Dutch in the 1650s

and in that context Bombay’s inaccessibility proved to be a big advantage (Kosambi 1993:212).

It was only after 1784 that Bombay began to grow due to the export of cotton to China in

return for Chinese tea. However, it was argued that the cotton exports could not keep up with the

increasing import of Chinese tea. This difference had to be compensated with the opium trade

within the triangular trade between India, Britain, and China since the eighteenth century. While

the role of cotton is well discussed in relation to Bombay’s transformation, the role of the opium

trade for capital accumulation is fairly under-researched.44

The opium trade and the emergence of the indigenous capitalist class—Opium was of

immense importance for the Indian economy, the Indian Empire and, ultimately for the global

economy of the nineteenth century. Because of its high profits margins, opium was one of the

primary export products of colonial India until in the end of the nineteenth century. This trade

was sustained by increasing consumption of Opium by China and other parts of the Southeast

(Richards 2002). The importance of opium for the colonial economy can be gauged from the fact

that from the early period of the EIC until the end of British Empire opium earned of the highest

revenues along with revenues from land and salt monopoly (Richards 2002: 153). The incomes

from opium steadily increased from about Rs 17.2 million per year in the 1830s, to Rs 50.3

million in the 1850s, and were at the highest at about Rs 93.5 million in the 1880s (Richards

2002:155).

44
For more on the opium trade, see Farooqui (2006), Richards (2002), and Siddiqui (1982).

62
 It is argued that it was the opium trade that led to the emergence of an indigenous

capitalist class in India engaged in the opium enterprise around the port (Farooqui 2006). The

opium trade not only linked Bombay to the world economy, especially China, but also to other

regions along the west coast of India, including Rajasthan, Sind, and Malwa. The British

government had a monopoly over the opium trade which was mainly concentrated in Bengal.

Opium was grown in the eastern Gangetic plain, processed in Bihar and Bengal and auctioned

and exported from Bengal. However, the control of the EIC in western India was relatively weak

throughout the eighteenth century, partly due to the Maratha power in the region. This enabled

the Indo-Portuguese traders to expand the trade of opium produced in western and central India.

Through the patronage of local rulers these traders were able to thwart the monopolistic control

of the British over the opium in the western and central India (Farooqui 2006). Thus, Farooqui

(2006:18) argues that “modern Bombay has its genesis in the poppy fields in Bihar.”

Realizing its inability to control the illegal opium trade in the western and central regions,

in 1846 the government allowed private and mainly Indian enterprise (mainly Marwari and Parsi

merchants) in opium along with the Western coast.45 Thus, along with the Gangetic opium,

opium from Malwa in central India was directed to be shipped to the world market from

Bombay. In the mid-nineteenth century, syndicates consisting of wealthy native merchants

(especially the Parsis) operating in the Opium trade purchased Opium auctioned by the

government and transported them through ships to Canton China (Siddiqui 1985; Richards

2002). These entrepreneurial communities later reinvested their profits from opium trade in the

emerging textile industry in Bombay from the mid-nineteenth century.

45
The Parsis in Bombay were one of the first Indians to develop trade networks with China during the colonial
period, prominent among them were people like Jamsetjee Jejeebhoy. See Siddiqui (1982) and Farooqui (2006).

63
 Cotton textiles—Earlier Bombay’s economy was centered on export of cotton to China to

settle EIC’s unfavorable balance of trade with China. However, in the middle of nineteenth

century the indigenous entrepreneurs started manufacturing cotton textiles in Bombay. This was

aided by road and rail development projects between 1830 and 1860 that linked Bombay to its

hinterland. The development of spinning and weaving mills led to the migration of mill workers,

particularly from the coastal areas of Konkan in the south. The first textile mill was established

in 1856 and by the end of 1875, Bombay had 27 mills and by 1900 this number grew to 82. By

the end of the nineteenth century, Bombay had established itself as an important commercial

center in India. “It handled about two-fifths of the total value of India’s foreign trade, 70 percent

of the value of the coastal trade and the bulk of the re-export trade to the Persian Gulf and to the

Arab and East African ports” (Chandavarkar 1994:25). The growth of cotton mills also led to

growth in various ancillary small-scale industries. Along with this Bombay also had emerged by

the end of the nineteenth century as a major financial center in India (Kidambi 2007).

All this economic activity attracted a lot of people to the city and Bombay’s population

grew by leaps and bounds. The city’s population more than doubled from 232,032 in 1833 to

more than half of million in 1849. Bombay’s population continued to increase in the latter part of

the nineteenth century due to an increase in migration caused by the speculative boom triggered

by the American Civil War in the early 1860s. In 1891, Bombay’s population was about 800,000

out of which only a quarter were born in the city (Kidambi 2007:22). The interwar period is

considered to be a crucial period in the growth of the city. It is argued that the loosening of the

colonial tie during the interwar period led to increasing fortunes of the textile industry and the

growth of its domestic market (Patel 2003). The textile industry became the largest employer in

the city with its employment rising from 147,000 in 1921 to 136,000 in 1931 (Kooiman 1985).

64
 As argued earlier (see foot note 29 on page 62), although Bombay’s initial growth was

due to its imperial connection, its commercial and industrial development was shaped in

important ways through its internal economy wherein the commodity markets were linked to

wider relations of production and exchange in the hinterland (Chandavarkar 1994:29). The

textile mills of Bombay depended increasingly on the domestic market. The labor for these mills

was recruited from the migrants from different regions. However, interestingly, these migrants

maintained close ties with their villages and contributed to the rural economy through their

remittances (ibid: 29). These continued links with their host villages played an important part in

the sustenance of the workers in the city and in their labor struggles. Gradually, there emerged a

unique working class culture and the area where mills existed came to be known as Girangaon,

or the “village of mills.” The workers who came to work in the textile mills were largely rural

migrants who migrated from the hinterland of Maharashtra, mainly the Konkan region on the

west coast (especially Ratnagiri) and the Deccan Ghat or plateau region in central India (mainly

Pune, Satara, Sangli, Nashik). It is also argued that all those who migrated were essentially small

land-owners and not landless rural poor. Thus migration and the possibility of earning quick

money further strengthened their rural power base (Chandavarkar 1994). In order to sustain

themselves in the city and to meet the material needs like employment, credit and housing they

had to rely on societal networks based on ties of caste, region and kinship. Thus, it was essential

for them to maintain their rural links. Therefore, the rural migrants did not assimilate in the city

by completely losing their rural identity. As a result of this, these rural links led to the formation

of working class institutions in the city such as tamasha (working class theater), krida mandals

(sports clubs), vyayam shalas (gymnasiums), gramastha mandals (village organizations),

65
khanavalis (dining houses), path pedis (credit societies), that only catered to their cultural needs,

also existential needs such housing, food, and finance .46

Uneven urban development

Due to the specific colonial economic, military, strategic, and political considerations, the

involvement of the colonial state in matters of Bombay’s urban development was often artificial

and uneven (Farooqui 2006). This unevenness has been most visible in the built environment of

Bombay, ever since its emergence as an industrial city in the mid-nineteenth century. Reflecting

the growing importance of Bombay as a port, the southernmost tip of the island facing the

harbor—the Fort area—became the nucleus of European settlement in the city. Just north of the

Fort separated by an esplanade was the native settlement. The Fort area itself was segregated

with the native Indians concentrated in the northern sections and the European population

concentrated in the south. The Europeans and the natives were not merely separated physically,

but also socio-economically differentiated. The Fort symbolized the sphere of western capitalism

where the main CBD was located, whereas the native quarter contained the indigenous bazaar

economy reflecting caste-based residential patterns (Dossal 1991; Kidambi 2007). However, as

the Fort area became overcrowded the colonial elite began to move to the south-western tip of

the island which over a period of time became the upscale neighborhood of Malabar Hill which

became an exclusive conclave of the Europeans. However, several wealthy Parsi families too

settled in that area (Farooqui 2006).

46
This aspect of working class culture assumes significant importance in the context of contemporary urban
development in Mumbai. The redevelopment of the mill-district has met with strong resistance from the former mill
workers who still reside in the tenements in the defunct mill premises. As discussed in chapter 6, the former mill
workers struggle is not only for housing and livelihoods, but also to preserve this unique predominantly Marathi
working class culture in the city.

66
 It is found that colonial urban planning primarily benefitted an elite minority in the city.

There were massive investments in grand architectural projects at the expense of critical issues

such as housing, transportation, health, and public services, concerning the majority of the city

residents (Hazareesingh 2001). Thus, “the economy of Bombay was reasonably affluent in the

early twentieth century: only its people remained poor” (Hazareesingh 2001:255). The

systematic anti-poor bias of the colonial officials was especially evident at the time of the

bubonic plague that hit the city in 1896. Having very little knowledge about the etiology of the

disease, the colonial plague policy was driven by class-biased assumptions about the disease

related to sanitation and hygiene leading to draconian acts that regularized forced eviction and

demolition of overcrowded tenements of poor people in the city. The plague also provided an

opportunity for the colonial state to pursue larger urban renewal strategies in the early twentieth

century under the City of Bombay Improvement Trust (BIT) formed in 1898. The task of the

Trust was to create an “orderly city” and for this it was expected “not only to carry out urgent

sanitary improvements, but also to enhance its image as a center of imperial and commercial

power.” However, these technocratic visions of restructuring urban space could not achieve

much success because of sustained local opposition involving diverse groups ranging from

property owners to particular caste and religious groups and communities (Kidambi 2007:78-81).

By 1909, the Trust had evicted over 50,000 people from their demolished one-room tenements,

however, only 2,844 new “sanitary” tenements (Hazareesingh 2001:240).

The uneven development was also reflected in terms of access to basic services in the

city. Despite the mid-nineteenth century population boom, there was no proportionate rise in the

civic facilities provided by the colonial state. The city constantly grappled with “abysmal

drainage and sewage disposal system, high morbidity and mortality rates, poor roads and

67
transport facilities, and insufficient and over-crowded housing” (Dossal 1991:30). Figure 6,

gives an overall picture of contemporary urban inequality in Mumbai. It compares access to

various services between the urban poor (using slum population as proxy) and the non-poor

population.

Figure 6. Urban Inequality in Mumbai

Criteria Urban poor (slum population) Non-slum population
(57 per cent) (43 per cent)

Access to toilet 47 per cent have access 100 per cent

81 people per toilet seat
20 per cent defecate in the open

Access to piped water 18 per cent 92 per cent

Water Supply 90 liters per capita daily (lpcs) 200 lpcs
(standard is 135 lpcs)
Health 10,147 people/bed in municipal 487 people/bed in private
hospitals (35 per cent of the urban hospitals
poor use municipal hospitals)
Water consumption 35-60 liters per person/day 300-400 liters per
(standard is 135 liters per person/day47
person/day)

Water costs 30 times more than the prescribed The rich not only pay less
rate for water but there is $ 123
million worth of pending
water bills of state
authorities, builders,
shopping malls, and
hotels.48

Education 31 per cent likely to complete 47 per cent likely to

high school complete high school

Source: Mumbai Human Development Report (2009).

47
MCGM supplies 800,000 liters of water every day to beverage and bottling plants in the city.
48
“Mumbait Thakit Paanibile 749 crores!” Lokasatta, December 14, 2009, p.2

68
Postcolonial Bombay/Mumbai

In the post-independence period after 1947, much of the profits from the textile industry were

reinvested in capital intensive industries such as engineering, pharmaceuticals, petrochemicals,

food processing, and fertilizers (Patel 2003). This growth also fuelled a radical working class

movement in Bombay. From 1960s, Bombay experienced major industrial restructuring which

deeply impacted the textile industry. There was a growth of new capital-intensive industries and

this was visible in the form of greater productive capital than employment in the organized

sector. From 1961 to 1981 the productive capital grew from Rs. 6 billion to Rs. 700 billion (van

Wersch 1992:18). The decline of the textile industry was further hastened by the textile strike in

1982-83, at the end of which almost 100,000 workers were retrenched and a considerable amount

of units were shut down. In 1976, 27 per cent of the city’s organized workforce was employed in

the textile industry, this figure dropped to 12.5 per cent by 1991.49 Most workers who lost their

jobs have joined the informal economy.

Industrial restructuring led to a growth in the small-scale power loom sector supported by

the state. The spurt in the growth of capital intensive power looms resulted in a loss of market

share of the labor intensive mills. While the overall production of cotton cloth (produced in the

cotton mills) remained stagnant during 1970-1987, the production of blended cloth kept growing

from the 1970s. Even during the strike, the production of synthetic, man-made fiber grew as it

was produced in the decentralized power loom sector that remained unaffected by the strike (van

Wersch 1992). Along with declining share of production, the technological backwardness of

textile mills further aggravated the situation. The obsolescence of machinery used in spinning,

weaving, and processing has been identified as one of the main causes of “sickness” in the

industry. However, this technological backwardness is not new. The mill owners’ refusal to
49
Bakshi (1986), cited in Patel (2004:335).

69
modernize the mills facilitated their eventual closure. Thus, the textile strike proved to be a

blessing-in-disguise for the mill owners as they could shut down the mills and reinvest the profits

in more lucrative sectors of the new economy.

Some scholars argue that what happened in Bombay cannot be called deindustrialization,

but spatial reorganization combined with an increasing expansion of the boundaries of the city

(Patel 2003).50 Due to this process of spatial reorganization, the central parts of the city ceased to

be the dominant regions of manufacturing as production was dispersed to the suburbs and other

satellite centers (outside Greater Mumbai, but within the Mumbai Metropolitan Region) such as

Thane, Kalyan, and Navi Mumbai. Because of this, the central parts of the city (including the

mill district in Mumbai) have now become the epicenter of the new economy in Mumbai based

on service industries including finance, tourism, retailing, and entertainment.

By early 1990s, this shift in the Mumbai’s economy toward jobs related to producer

services becomes more visible as seen in the following quote from Harris (1995):

By 1994, Bombay accounted for 61 per cent jobs in India’s oil sector, 41 per cent in domestic air
traffic. Its airport handled 75 per cent of the country’s imports and 64 per cent of exports.
Employment in financial and business services had increased by 43 per cent between the 1970s
and 1980s. Bombay collected 25 percent of India’s income tax revenues and 60 per cent of
custom revenues. Its banks controlled 12 percent of national deposits and a quarter of the
country’s outstanding credits. The number of issues listed on the Bombay’s stock exchange grew
from 203 in 1991-2 to 694 in 1993-4, and the amount of fresh capital in old and new companies
increased from Rs 54 billion to 213 billion between these years.51
According to the Draft Regional Plan of the Mumbai Metropolitan Regional Development

Authority (MMRDA) published in 1995, the employment in manufacturing industries in Greater

50
In this context Patel (2003:11) argues that even though much of formal sector production shifted to informal and
small-scale sector, older capital-intensive high-value production through subsidiaries of multinational companies
continued due to a demand from domestic consumption in Mumbai. This was largely achieved due to large
resources of skilled labor in the city.
51
Cited in Patel (2003:17).

70
Mumbai has declined from 36 per cent in 1980 to 28.5 per cent in 1990, whereas employment in

trade, finance, and service-based industries increased from 52.1 per cent to 64.3 per cent during

the same period (MMRDA 1985). The formal inauguration of the structural adjustment policy in

1991 (popularly referred to as liberalization) has further accelerated the process of urban

restructuring in the city.52

In the post-liberalization years, urban planning in Mumbai is self-consciously geared

toward “managing city space” in order to render it a “global” or “world class” status and to

convert the city into a significant financial and service center at the cost of industrial decline in

several areas (Banerjee-Guha 2002). Informally, this is also referred to as the “Shanghaization”

of Mumbai, alluding to Shanghai as the preferred model of development for Mumbai

(Mahadevia and Narayan 2005). In chapter 4, I provide a detailed analysis of the genealogy of

the Shanghaization discourse in Mumbai. However, it is important there is a need to have a

comparative context to the discussion on Shanghaization to understand why the urban elite in

Mumbai seek to emulate this model of urban growth and whether it is an effective model for

Mumbai. Therefore, in the next chapter 3, I critically analyze the Shanghai model of

development as it emerged in China.

52
Structural adjustment primarily implies changing importance and role of different elements and sectors of the
economy in the process of development. It takes place either on the basis of the interplay of market forces of
demand and supply, internally and internationally, or is brought about on the basis of conscious and deliberate
policy measures adopted mainly on the macroeconomic front (Papola 1994). In the contemporary world economy,
structural adjustment has acquired a narrower meaning. In the developing world, particularly since 1980s, structural
adjustment is said to be engineered by international financial institutions as a solution to the economic crisis faced
by the developing countries.

71
Figure 1. South and South East Asia Figure 2. Maharashtra State, India
Source: Google Maps (2013) Source: Google Maps (2013)

Figure 3. Map of Mumbai

Source: Compare Infobase Pvt. Ltd.

72
 CHAPTER 3

THE SHANGHAI MODEL OF DEVELOPMENT

~Today, Asian cities are fertile sites, not for following an established pathway or master
blueprint, but for a plethora of situated experiments that reinvent what urban norms can
count as global (Ong 2011:2).

Worlding Cities

The dynamism of cities of the global South has led to a rethinking of the dominant theoretical

accounts of cities and globalization.53 There is strong emerging scholarship based on the

experiences of cities of the South that have questioned many of the assumptions of western and

structurally deterministic understanding of urban change (King 2000; Robinson 2002; Roy

2009b; Roy and Ong 2011; Shatkin 2007; Short and Kim 1999). Roy and Ong (2011) in

particular go the farthest in their critique of existing “global generalizations” (both global

capitalist and postcolonialist perspectives) that privilege singular and predetermined logics of

global change. What is advocated, therefore, is a more “open-ended” analysis, where “worlding”

of cities is understood as an emergent process, as “the art of being global,” in which global

claims are understood to be always “in formation” with uncertain outcomes (Ong 2011:22-23).54

In the process, certain global forms are recontextualized and adapted to specific contexts.

Therefore, as a global form, the neoliberal is articulated as a situation-specific “art of being

global” (Ong 2011:24). According to Roy (2011b), “worlding” in the global South can no longer

be understood simply as “globalization imposed by the West on the rest.” The emerging models

53
The wide-ranging issues covered include emerging urban modernity (Rao 2005); new contestatory politics
(Chatterjee 2004; Sassen 2004); alternative urban theory (Marcuse and van Kempen 2000; Robinson 2002; Roy
2009b; Roy and Ong 2011; Shatkin 2007; Simone 2001).
54
As against the dominant “global/world class city” approach, “worlding” of cities is understood not merely in
terms of networks of finance and informational capital. It highlights other ways of “reaching out to the world” that
happens either as a matter of day-to-day survival or through organized networks of social relations that are equally
important in the world economy. For more on this see Roy (2009); Roy and Ong (2011), and Simone (2001).

73
of “homegrown neoliberalization” are based on new worlding practices such as inter-referencing

involving “South-South coordinates and emergent South-based global referents” (Roy 2011b:10,

emphasis added). Ong (2011:17) defines inter-referencing as “practices of citation, allusion,

aspiration, comparison, and competition” vis-à-vis a “more successful city.” In the case of

Mumbai, inter-referencing takes the form of “elite dreaming” where Asian cities such as

Singapore and Shanghai are invoked as an aspiration, justifying a range of urban experiments

related to real-estate development, clearing of slums, and suppressing local resistance (Ong

2011:17).

Mumbai’s Shanghai Dreams

In recent years, Shanghai has increasingly shaped the perceptions of how China is viewed within

as well as outside the country. It is viewed as a symbol of a “rising China." Nowhere in the world

have people been so obsessed with Shanghai than in Mumbai, the business capital of India,

where intellectuals, planners, as well as common residents are preoccupied with the question of

transforming Mumbai into Shanghai. In this context, Huang (2008a) argues, “it would seem

preposterous to even ask the question, “What is wrong with Shanghai?” Shanghai’s role in the

economic growth in China is almost obvious, taken-for-granted, and uncontested. Scholars from

Thomas Friedman to the World Bank economists are enamored by the “Shanghai model.” At a

conference in 2007, the World Bank hailed Shanghai as the poster-child of its FDI-led

globalization and based on the “Shanghai miracle” argued that urbanization was the only means

to reduce poverty in the South (Huang 2008c). Outside China, in cities such as Mumbai, much of

this Shanghai-fixation is based on, what Huang aptly refers to as, “numerical equivalents of

tourist pictures of Shanghai” that include the Shanghai/Pudong skyline (Shanghai’s redeveloped

financial district) and the city’s high-speed Maglev train (Huang 2008c). However, these

74
discourses of urban transformation in Mumbai and elsewhere take place without any detailed

knowledge about the actual economic realities in Shanghai.

The focus of the recent national and urban policy in India has been to technically

restructure Mumbai’s city space in order to make it “world class” and to transform the city into

an “international financial center” (Banerjee-Guha 2002). This is referred to as Shanghaization in

the local press, in reference to Shanghai as the preferred developmental model (Mahadevia and

Narayan 2005). The Shanghai rhetoric was first articulated by the Prime Minister of India, Mr.

Manmohan Singh, in October 2004 in a state election speech when he said:

When we talk of a resurgent Asia, people think of the great changes that have come about in
Shanghai. I share this aspiration to transform Mumbai in the next five years in such a manner that
people would forget about Shanghai and Mumbai will become a talking point…I have a dream
that we can do it. I believe we can become number one through modernization, expansion, and
development and make Mumbai the number one city in our country.55
Mr. Singh reiterated the Shanghai rhetoric at yet another speech in 2006 at a conference co-

hosted by the Wall Street Journal:

I am convinced that a historic opportunity for the revamping of Mumbai presents itself before us
today. Mumbai can emerge as a new financial capital of Asia, and be the bridge between Asia and
the West in the world of finance….I do believe that Mumbai can learn from Shanghai’s
experience in reinventing itself; in rebuilding itself; in rediscovering itself. I urge every
Mumbaikar to transform this city from being a Gateway to India to becoming a Gateway to
Asia!56
Soon after the 2004 elections, the state government unveiled a 6.5 billion USD plan to transform

Mumbai into a “world class city” like Shanghai. The central government too offered to invest

around 2 billion USD over a period of five years in this effort. Some of the recommendations of

55
Siddharth Srivastava, “Mumbai struggles to catch up with Shanghai,” Asia Times, March 16, 2005. Retrieved
March 9, 2011 (http://www.atimes.com/atimes/South_Asia/GC16Df02.html).
56
This is an excerpt from the key note address delivered by the Prime Minister on May 18,2006 at the 16 th Asian
Corporate Conference in Mumbai titled, “Driving global business: India’s new priorities, Asia’s new realities.” This
conference was organized by the Asia Society along with The Wall Street Journal and The Confederation of Indian
Industry (CII). Retrieved March 27, 2012 (http://www.asiasociety.org/conference06/).

75
the plan included key infrastructure projects, redevelopment of “encroached” land, and

beautification of the international airport in the city. 57 Soon after this plan was announced, within

two months, 90,000 homes of slum dwellers were demolished (Mahadevia and Narayan 2005). I

will discuss these displacements in more detail in chapter 5.

Yasheng Huang (2008a) argues that the political elite in Shanghai viewed Shanghai as

the symbol of a rising China reaching out to the world. Much in the same manner, the political

elite in India too view Mumbai as an embodiment of India’s integration in the world economy as

highlighted by the following quote from a speech of the Prime Minister at the launch of the

Phase I of the Mumbai Metro Rail in 2006:

I have often said that Mumbai is not an ordinary city, its contribution to the creation of wealth in
our country, the symbol of hopes and aspirations of a resurgent India… it is an embodiment of
the spirit of India that India is out to embrace globalization…Mumbai symbolizes India to the
external world (emphasis added). 58
It is clear from the above quotes that Mumbai’s transformation is intricately tied with sustaining

the momentum of economic growth in India. Moreover, the “Shanghai Model” is not just a local

urban imaginary, but (as we shall see in more detail in the next chapter) is slowly emerging as an

urban, export-led national strategy of economic development in India. But before going into the

specific discussion on the Shanghai model in China, I will first discuss what makes this

association of Mumbai and Shanghai plausible by comparing these two cities. In this regard,

Mumbai and Shanghai have some interesting points of convergences. Analyzing these

convergences may shed further light on Shanghai’s developmental appeal for Mumbai.

57
Siddharth Srivastava (ibid).
58
PM lays foundation stone of phase-I of Mumbai Metro, June 21, 2006. Retrieved March 27, 2012
(http://pmindia.nic.in/speech/content4print.asp?id=342).

76
Parallels between Shanghai and Bombay/Mumbai

Port cities

The “Asian urban connection” stretches far back in history to the thirteenth century precolonial

maritime trade routes extending from the Red Sea to the South China sea and constituted by

mobile merchant communities of Asia constituted by the Chinese, Indian, and (Baghdadi) Jews

involved in long-distance credit networks (Duara 2010: 965). Sen (2010) pushes the period of

Asian precolonial networks even further back to the first century trading networks consisting of

both overland and maritime routes. According to Sen (2010:992), it was by the first century that

the major ports and urban centers of Asia were linked with each other.59 The Europeans

(particularly Britain) came to dominate the long-distance Asian sea trade world only in the

seventeenth century. Before this, until the sixteenth century, the sea trade was dominated by the

Ottomans, the Mughals, the Ming and the Ch’ing (Washbrook 1997:426). By the nineteenth

century European powers substantially expanded and rebuilt the earlier precolonial trade

networks.

British imperialism in the nineteenth century created new linkages between cities (and

hinterlands) of Aden, Bombay, Calcutta, Singapore, Hong Kong, and Shanghai as entrepôts and

financial centers for Asian trade. These linkages were deepened through the spice trade that

linked the maritime trade of Asia with the Atlantic (Duara 2010:964). It was during this period

that Shanghai and Bombay emerged as thriving port cities and later industrial centers. However,

the foundations of these maritime trade networks were laid much earlier in the precolonial period

Sung China and the Mughal period.

Both Shanghai and Bombay historically were fishing hamlets which evolved as premier

port cities in the mid nineteenth century. As port cities, they served the function of “gateway

59
For more on precolonial Asian networks refer to the seminal study on the subject by K. N. Chaudhuri (1990).

77
cities” in the context of the colonial trade and both have remained, for most part, their respective

country’s preeminent cities. The initial impetus of growth in both the cities had occurred

primarily due to British-led colonialism, or quasi-colonial “treaty-port system” in the case of

Shanghai (Wasserstrom 2003:56). At the end of the First Opium War, Shanghai was one of the

five treaty ports established by the British under the Treaty of Nanjing in 1843. A section of the

city was opened to British trade and settlement. What initially began as a British settlement came

to be occupied over a period of time by the Americans and the French through what was referred

to as “concessions” or exclaves, each having its own set of extraterritorial laws (Abbas 2000).

Gradually, within the area of international settlement there emerged what Abbas (2000) calls

“cosmopolitanism of extraterritoriality,” which was most manifest in the built space of the city

with its “Tudor-style villas, Spanish-style townhouses, Russian-style churches, and German-style

mansions, along with the internationalism of the buildings on the Bund” (p.774). The “Bund,” a

water-front area within the international settlement in the north of the walled city, became a

financial hub of East Asia at the end of the nineteenth and beginning of the twentieth century.

Until 1940s, it housed most of the financial institutions in China.60 These developments,

however, led to extreme inequalities in the city, especially between the Western

“Shanghailanders” and the “native residents,” the local Chinese people. Until 1930s, the

“Shanghailanders” viewed the international settlement as an “free floating republic” where only

foreigners were viewed as citizens with rights, while the “native residents” were considered as

“guests” (Wasserstrom 2003:55; 2009). In this regard, Abbas (2000) argues that Shanghai was a

“nonviable city,” linked to the rest of the world, but delinked from the rest of China (p.776).

60
The word “Bund,” refers to a levee or a dam and is said to have derived from a Hindi/Urdu word “Bandh,” having
Persian roots.

78
 As discussed in the earlier chapter, Bombay’s initial development too came about due to

the British imperial interests in the colonial division of labor. Bombay replaced Calcutta as the

main commercial node for the British in the mid-eighteenth century due its geographic proximity

to Europe and its excellent natural harbor. Due to a shortage of cotton caused by the American

Civil War and the opening of the Suez Canal in 1869, Bombay expanded economically. The first

textile mill was established in 1856 and by the end of 1875, Bombay had 27 mills and by 1900

this number grew to 82. By the end of the nineteenth century, Bombay had established itself as

an important commercial center in India. It was during this initial period of expansion that much

of the wide-scale urban development projects were introduced in the city (Dossal 1991). Just like

Shanghai, British imperial metropolitanism manifested itself in the built-form of the city as seen

in its numerous Victorian buildings, churches, theatres, and cricket clubs. Like Shanghai,

Bombay too was a “dual city” that displayed simultaneously extreme wealth and poverty

(Pacione 2006).

The victory of the Chinese Communist Party (CCP) in 1949 ended Shanghai’s

“bridgehead” function that characterized it since the mid-nineteenth century. From then on with

more centralized command over local government, Shanghai was viewed as a “locomotive” for

state-led industrialization. The role of the city changed from being a center of trade, finance, and

distribution of foreign products to an industrial city (Wu 2003). Shanghai’s

“grotesque cosmopolitanism” nurtured by its reputation as being the most “open” city in the

world, free from the bureaucratic state, did not fit well with the Communist agenda of nation-

building. Therefore, there was a conscious effort made to erase Shanghai’s urban memory

(Abbas 2000:775-76). Further, under the leadership of Mao Zedong, cities ceased to be viewed

as exclusive sites of modernity. The cosmopolitan culture embodied by Shanghai was regarded

79
by the new leaders as being “bourgeois and decadent” (Abbas 2000:776). Driven by the new

ideological zeal of nation-building, Shanghai lost its claim as China’s preeminent city as a result

of neglect and underinvestment in the city. This led to a capital flight from Shanghai with most

of the financial investors and institutions in Shanghai moving to the British colony of Hong

Kong, fueling Hong Kong’s industrial development from the 1950s onwards.

Mumbai’s too has moved in a similar historical trajectory of the colonial, the national,

and the global phases (Chakravorty 2000; Grant and Nijman 2002; Nijman 2007). The national

phase of Mumbai that lasted from independence in 1947 until 1980s was characterized by a

relative insulation of Mumbai from the global economy and a weakening of foreign presence in

the city (Nijman 2007). However, the post-colonial context of Mumbai’s development did not

affect its preeminent status as adversely as it did for Shanghai. Mumbai continued to remain the

financial capital of the country and the most globally connected cities in India. However, in more

recent times it has had to compete with cities such as Bangalore and Hyderabad for investments

in the emerging sectors of the economy led by information technology.

Immigrant cities

Both Shanghai and Bombay/Mumbai are also immigrant cities whose growth as industrial

centers has attracted considerable international (particularly in Shanghai) and regional migration.

What is interesting to note is that in both these cities immigrant merchant families played a very

important role in their initial development. In the case of Shanghai, merchant families from

nearby Ningbo (in Zhenjiang province) became an integral part of the coastal trading system and

later commercial activity in Shanghai. Having the advantage of being the first treaty port in

1849, Shanghai surpassed Guangzhou (Canton) as China’s premier trading city by 1853 (Wu and

Yusuf 2004:27-28). The industrial development from mid- to late-nineteenth century attracted a

80
lot of foreign presence in Shanghai. During its “golden days” in the 1920s, Shanghai attracted a

lot of migrants from other parts of Shanghai (Wu 2007:115). Rapid growth in the 1980s further

attracted more migrants to the city to meet the increasing labor demands facilitated by a

relaxation of migration policies. It is estimated that there are around 3 million temporary

migrants working in Shanghai who (given their temporary status) have little access to education,

housing, and other basic services in the city (Wu 2007:126). Similarly, Bombay’s initial growth

through the opium trade and later textile industry was led by merchant communities who

migrated from Surat, the earlier premier port city of Western India. Further, the development of

spinning and weaving mills led to the migration of mill workers, particularly from the coastal

areas of Konkan in the south of Bombay. In 1891 Bombay’s population was about 800,000 out

of which only a quarter were born in the city (Kidambi 2007:22). Following Independence and

the partition of India and Pakistan, Bombay’s population grew rapidly between 1941 and 1951,

especially in the suburbs (Pacione 2006: 231). With over half of the population being of non-

Maharashtrian ethnicity, Mumbai has emerged as India’s most cosmopolitan city represented by

immigrants from western, northern, as well as southern parts of India.

Financial centers

Both Shanghai and Bombay/Mumbai have emerged as key financial centers in their respective

countries due to historical and geographical factors. In the twenty-first century Shanghai is

competing with Hong Kong and Beijing as the preeminent Chinese city in terms of finance and

industry. Compared to both the cities, Shanghai is more favorably disposed in terms of overall

lower living and business expenses as well a great location with potential to emerge as a regional

financial center due to the recent reorientation of the Chinese economy. Shanghai is situated in

the Yangzte River Basin and along with Hangzhou and Wuxi forms one of the most important

81
urban regions in China. The Yangstze Basin is predicted to grow economically due to rural

industrialization and rapid development of transport and communication infrastructure in the

region (Wu and Yusuf 2004). Since 1990, Shanghai has received considerable federal

investments and under Deng Xiaoping’s leadership the Pudong New Area district emerged at the

new financial district of Shanghai. Between 1990 and 2000, 22 billion USD were invested in the

development of Pudong and by 1999 it accounted for one-fifth of the metropolitan GDP of

Shanghai (Wu and Yusuf 2004:33-34). Moreover, with the introduction of the Pudong

international airport in 1999, Shanghai has also emerged as a regional passenger hub. Further, in

2010 Shanghai became the busiest container port the world after it overtook Singapore. In 2010,

the Shanghai port handled close to 30 million TEUs (20-foot equivalent units), more than that of

Singapore’s 23.56 million TEUs.61

Mumbai too has made significant strides toward becoming an important financial center

in the region and is already the financial capital of India. Located in the city are two stock

exchanges—the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), head

offices of the two financial regulating agencies—the Reserve Bank of India (RBI) and the

Securities and Exchange Board of India (SEBI), head offices of several banks (foreign and

national), and two major ports. Mumbai contributes one-third of the total direct taxes collected in

India, 40 per cent of the national fiscal receipts, one in every three checks issued in the country

are cleared in Mumbai, the Jawaharlal Nehru Port in Mumbai handles 58 per cent of the

country’s container traffic, and the per capita income of Mumbai is 39 per cent higher than the

61
“Shanghai Port is World’s Busiest.” The Economic Times, December 24, 2011. Retrieved May 6, 2012
(http://articles.economictimes.indiatimes.com/2011-12-24/news/30554773_1_container-traffic-teus-port-operator).

82
national average.62 The city also has the largest international airport and is thus an important

transport junction point in India. Along with this, Mumbai is also an important center for

entertainment and tourism. Mumbai is home to Bollywood, one of the world’s largest film

industry (with an average of 140 film releases a year) which further contributes to the growth of

other service industries such as the travel, tourism, and hotel trade (Patel 2004).With recent

deindustrialization and growth in services, the city is projected to emerge as an important

financial center for Asia and the world. However, unlike Shanghai, the external sector plays a

relatively small role in Mumbai’s economy (Harris 1995; Grant and Nijman 2002). However, the

liberalization of the Indian economy in the 1990s has expanded financial activity in the region

through the deregulation of real estate market. The creation of the new commercial center at

Bandra-Kurla in the northern suburbs of the city has also provided an alternative location to the

heavily congested CBD in the South. However, despite emerging as their countries’ premier

financial centers by creating the physical infrastructure and having offices of international

financial institutions, it is argued that Shanghai’s and Mumbai’s claims to become regional and

global financial centers would need to be backed by deeper reforms in their financial markets,

which have been rather slow (Harris 1995; Wu and Yusuf 2004).

Understanding the Shanghai Model of Development

Fast growth

From 1990-2000, Shanghai experienced a phenomenal increase in its GDP growth rate, the

largest in the region. As a result of this some even consider it as a “new Chinese miracle” (Zhang

2006). Shanghai’s growth during 1990-2002 was higher than the national average. During 1990-

2002, Shanghai’s growth rate increased by 479%, whereas that of China’s increased by 346%

62
These figures are quoted in Malini Bhupta, “Old player in a new economy,” India Today, August 14, 2006.
Retrieved May 5, 2012 (http://indiatoday.intoday.in/story/mumbai-reaching-its-limits-needs-to-remodel-itself-
kamal-nath/1/180756.html).

83
(Segbers 2007:16). Further, Shanghai’s per capita GDP was five times higher than the national

average (Zhang 2006). The GDP growth rate of Shanghai increased from 4 per cent in 1990 to

around 11 per cent in 2002. The biggest leap in the growth rate was observed during the year

1991-1992, where it doubled from almost 7 percent to almost 15 per cent, an increase of 8

percentage points in a single year. Ever since, it has either remained steady or declined

marginally (Zuo and Huang 2005).

This rapid economic growth in Shanghai was also marked by drastic economic

restructuring in Shanghai in order to reconnect it to the global economy. There was a shift from

labor to capital intensive manufacturing and a shift from manufacturing to finance (Zuo and

Huang 2005). Much of Shanghai’s recent GPD growth is attributed to the growing importance of

Shanghai as the gateway of service-based industry. The service sector output in Shanghai grew

ten-fold from 1990-2001 from 2.94 billion USD to 30.61 billion USD. In terms of GDP, its

output increased from one-third to just over half in 2002. Within the service sector, real estate

was the fastest growing segment. The share of the real estate industry within the tertiary sectors

increased from 1.6 per cent in 1990 to 13.6 per cent in 2002. It is argued that this was by and

large a result of the shift from free servicing to pricing and development of the real estate market

(Zuo and Huang 2005:80-81).

There is no doubt that at the aggregate level Shanghai has made rapid progress on the

economic front. However, this rapid growth also raises a lot of questions: First, how do we

explain Shanghai’s rapid economic in the context of a wider discussion of China’s economic

ascendancy? Is this growth neoliberal or as Harvey (2005) explains, “neoliberalism ‘with

Chinese characteristics’” or is the emerging picture much more complex for such neat

definitions? Moreover, in the context of Mumbai, is Shanghai a good developmental model?

84
The “Shanghai miracle”: neoliberalism or political maneuvering?

David Harvey in his highly influential book A Brief History of Neoliberalism (2005), argues that

the Chinese economic reforms introduced by Deng Xiaoping in 1978 represents an attempt (like

the Chilean experiment) to construct a particular kind of market economy fusing neoliberal

elements with authoritarian centralized control. He further equates reforms in China with

authoritarian neoliberal tendencies of the neoconservatives in the US and the UK. Diverging

from Harvey’s views, Giovanni Arrighi (2007) argues that the main basis for the Chinese growth

was not neoliberal reforms, but the investments made in health, education, and a “capacity of self

management” that emerged due to the welfare policies of late-imperial Qing China in the

eighteenth and early nineteenth century. Therefore, unlike self-regulating neoliberal markets, the

“invisible hand of the state” symbolized decentralized governance with minimal bureaucratic

interference by the state.63 However, both these radically different accounts of China’s economic

success are premised on a particular understanding of the state. Alternatively, Ong (2007)

proposes the “neoliberalism as exception” thesis in the context of East Asian development which

steers away from the state-based understanding of neoliberalization. She calls for a more situated

analysis of neoliberal technologies as political exceptions that enable certain sovereign practices

and subjectifying techniques that deviate from the established norms (Ong 2007:12). Therefore,

as a political rationality, neoliberalism is not limited to advanced liberal democracies.

Neoliberalism as exception can be deployed in various political settings: postcolonial,

authoritarianism, or postsocialist (ibid: 14). Ong (2007) further argues that in a

“postdevelopmental” context, the neoliberal states are no longer merely administrators of

watertight national entities, but become regulators of diverse fragmented national spaces and

populations connected or disconnected from global circuits of capital through various “zoning
63
For a more detailed discussion on this see Chu (2011).

85
technologies.” In the context of China, this is evident in the creation of special economic zones

(SEZs) characterized by differential regulating practices.

In the context of late industrializers in East Asia, unlike advanced liberal democracies, it

were the relatively autonomous “Developmental States” that engaged in industrialization and

rapid economic growth and at the same time tried to improve the material and social well-being

of its citizens (Hill and Kim 2000; Leftwich 2002). The model followed by postsocialist China is

closer to the East Asian model where reglobalizing strategies in Shanghai are seen as an

opportunity to transform the role of the state and to legitimize its presence in the economic

sphere (Wu 2003). In this context, Wu (2007) states, “[t]he spatiality of the globalizing city

becomes an important medium and vehicle to achieve the aspiration of the state” in the context

of a new postsocialist power structure and a rescaled state. Thus, in a rather peculiar sense the

whole urban entrepreneurial endeavor in China is organized into a state project. Within this, it

has become important for the Chinese state to coordinate the roles of Shanghai, Beijing and

Hong Kong. Moreover, it is argued that as the state retreats from overwhelming economic

command in the postsocialist context, it is very unlikely that the “market” is going to take a more

dominant role of coordination (Shi and Hamnett 2002).

Huang (2008a) has argued that the very essence of the ‘Shanghai miracle” is completely

political, rather than economic. It was politically constructed in the context of a changing

political structure in China driven by local political forces centered in Shanghai. Two recent

incidents illustrate the important role of national and local politics in the context of China’s

contemporary transformation. In 2006, Chinese President Hu Jintao suspended Shanghai’s

Mayor Chen Liangyu from the Communist Party’s Central Committee and its Politburo under

charges of corruption, criminal involvement, nepotism, and legal violation. One of Liangyu’s

86
colleagues was also accused of misappropriation of 400 million USD worth of city’s pension

funds. This extra-ordinary action by the President assumes great significance in the context of

the changing political structure in China. Liangyu’s dismissal came at a time when the National

Congress of the Communist Party of China’s (CPC) was having its plenary meeting to vote on

the reshuffling of the Politburo, the most important decision making body in China. Also on the

table was the macro-economic agenda to slow down the over-heated growth in infrastructure and

property sector. Both these proposals met with resistance from members of the “Shanghai

clique” which emerged as dominant power brokers in Chinese politics since the 1980s under the

earlier President Jiang Zemin, who served as the Mayor of Shanghai in the 1980s. 64 Therefore,

the indictment against Liangyu was perceived as a show of strength by Mr. Hu Jintao not merely

to the provincial and lower level leaders who defied central government's efforts, but more

specifically it was aimed against the “Shanghai clique.”65

In another recent incident in April 2012, the Chongqing Communist Party secretary Bo

Xilai was suspended from Politburo’s membership as well as the central committee of CPC

under allegations of illegal business operations. Apparently, the central leadership was not

comfortable with Chongqing party’s proclivity to the “cultural revolution.”

At a broader level, both the above incidents indicate an ongoing political and ideological

struggle over the future path of development in China. The sacking of Liangyu highlights a clash

between two differing ideologies of economic growth in China: on the one hand, the real-estate

led Shanghai model of growth which was viewed by the new leadership as being wasteful and

64
Some prominent members among them include former President Jiang Zemin, former Premier Zhu Rongji, and
the current Vice-President Xi Jinping. Generally more right-leaning, the “Shanghai Clique” is critical of the extreme
left and is more opposed to the reformist policies of the current Chinese administration of President Hun Jintao and
Premier Wen Jiabao.
65
“Shanghaied: Hu Jintao sticks out his elbows and fires Shanghai's party chief.” The Economist, September 2006.
Retrieved April 25, 2012 (http://www.economist.com/node/797102).

87
speculative and on the other hand, an emerging ideology of growth that emphasizes social and

financial stability. In terms of the other incident, scholars have explained the sacking of Xilai as

a fall out of the struggle between the Chongqing model of growth and the mainstream model.

The Chongqing model has emerged as a radical critique of the current mainstream “neoliberal”

developmental model and privileges state-owned enterprises, affordable housing for the poor,

and support for small businesses in the region (Xu 2012). From the above two incidents it is clear

that the current central leadership in China has to engage with diverse competing factions and

ideologies, especially the members of the “Shanghai Clique”. Therefore, any attempt to

understand the Shanghai model of development has to take into account the complexities of

China’s political power structure.

Shanghai and the political power structure in China

Although it is assumed that the political system in China is rigidly hierarchical and authoritative,

in reality the political power is China is found to be much more diffused, complex, and often

competitive, leading to a fragmented political process and blurring of authority (Martin 2010:1).

Largely, political power in China is concentrated in its three main political institutions: the Party

(the CCP), the state government (consisting of ministries and provincial, municipal, and country

governments), and the People’s Liberation Army. Along with these institutions, there are also

other political actors that influence government policies such as the provincial and local officials,

official and semi-official policy research groups and think tanks, and state and private business

interest groups (Martin 2010). Although most political power rests with the central government,

the constitution does grant local government some degree of autonomy to preside over the

administration functions related to the economy, education, science, culture, public health, and

urban and rural development. The relationship between the central government and the

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provincial, municipal, and local governments is differentiated. The provincial leaders are

appointed by the central government and generally care is taken to make sure that they are not

from the same region to avoid entrenched corruption. However, the country and municipal

leaders are from the same region and often the ministries have less control over them. As a result

of this, there is often a problem disciplining local leaders and corruption is generally high among

officials at the country and municipal levels.

Historically, under the socialist regime, the political power structure in China was more

centralized and was characterized by a vertical hierarchy that formed the basis of a command

economy. The key actors within this set up were the central government, its agencies, and

various “state work units” where most of the resources and planning was concentrated. The CCP

was integrated within the government and the state units. However, in the postsocialist period

characterized by wide-spread market-oriented reforms during 1990-2000, there was a

reconfiguration of the central and local power relations with local states gaining more autonomy

through fiscal and political decentralization (Wu 2007). Further, there was a decentralization of

decision-making related to local financing, land use, and developmental policy (Zhang 2006).

Further, post-Tiananmen Square, the new central leadership was more favorably disposed

to Shanghai as most of the influential central leaders had earlier served as key officials in the city

and had entrenched economic and political interests associated with the city. For example, both

President Jiang Zemin (Communist Party secretary and President from 1989-2003) and Premier

Zhu Rongji (1991-2003) had earlier served as mayors of Shanghai in the 1980s (Zhang 2006:42).

However, with Jiang Zemin’s resignation as the Chairman of the Central Military

Commission in September 2004 (his last official post), the current President Hu Jintao has

assumed control over all the three political institutions in China: the party, the state, and the

89
military and has therefore emerged as the most powerful leader. In opposition to the Shanghai

model of development, the new leadership that took over in 2002 has embarked on a new

ideological campaign that focuses on building a “harmonious society” based on balanced

development. The new approach —“scientific development” (kexue fazhanguan) or

“comprehensive, coordinated, and sustainable development” — outlined by President Hu Jintao

in 2003, seeks to correct the earlier overemphasis on GDP-focused economic growth that

neglected social welfare. The new official rhetoric has now shifted from “economic growth” to

“social harmony” incorporating sustainable development and social welfare (Fewsmith 2004:1).

Following this, Prime Minister Wen Jiabao also announced measures to improve the situation of

workers and peasants which included reemployment of laid-off workers, improving industrial

safety, abolishing agricultural tax for farmers, educational subsidies for poor rural children and

payment of unpaid wages of rural migrant workers.

In order to build a consensus, the new approach seems to carefully balance earlier

socialist and postsocialist ideologies. On the one hand, it tries to weed out local corruption and

entrenched political interests through a set of regulations aimed at institutional reform that

encourages voting and meritorious and competitive selection, rather than selection based on

seniority and nepotism. On the other hand, in stressing this fact it uses a language is inherently

neoliberal. For example, during one of the conferences on “human resources” organized jointly

by the CPC Central Committee and the State Council, a decision was made to rename

recruitment terminology from “party administering cadres” to “party administering qualified

personnel.” Party cadres are now viewed as “creators of value” and “outstanding management

personnel and professional and technical workers.” Apparently, these changes were also driven

by the pressures of a market-driven, globalized economy wherein private and international firms

90
are more interested in hiring employees regardless of the traditional cadre-management practices.

However, despite the rhetoric, the fact that the party is still in charge of selecting skilled

personnel and indicates the dominance of the Party and its traditional planning mentality

(Fewsmith 2004:4).

Despite such careful maneuvering, there is still no consensus over the new approach as

highlighted by the recent split in the PSC between two factions: the “populists” and the “elitist.”

The populist group favors more balanced economic development on the principles of a

“harmonious society,” while the “elitist” group favors continued rapid economic development,

catering to capitalist and middle-class interests (Martin 2010:5).66 This bears testimony to the

entrenched nature of this ideology of growth in China. However, there is still a lot of distance

between the official rhetoric and reality as seen in the rise in “unofficial transcripts” of various

informal human rights movement, workers’ unrest, and peasants’ discontent (Mittleman 2006).

Evolution of the Shanghai model

The multiscalar contexts. The emergence of Shanghai model in China has to be

understood in terms of its specific historical juncture by highlighting the particular global,

national, regional, and local contexts within which Shanghai emerged a preeminent engine of

economic growth for China. The end of the Cold War gave rise to new technologies that enabled

increasing capital flows and a new international division of labor giving rise to a new round of

global competition. In this new phase of economic globalization, the newly industrialized

countries (NICs) such as South Korea, Taiwan, Hong Kong, and Singapore advanced on the

basis of their export-oriented development, leading to the “Asian Miracle.” Following the model

of the “Asian Tigers,” China gradually began to adopt economic reforms and an open door

66
Within the CCP, the Politburo and the Politburo Standing Committee (PSC) consist of a two dozen or more of the
most senior officials. However, it is the PSC—a smaller group of political elite—where most of the political power
rests.

91
policy in 1979. In adopting an export-oriented development strategy, China began to concentrate

on its coastal regions. Thus, by 1990, due to its strategic location in the Yangtze River Delta and

historically being the largest financial region in East Asia, Shanghai was chosen as the “dragon-

head” that would link China’s economy with the rest of the world (Wu 2003:1683-84). Driven by

the imperatives of economic globalization, China needed a “global city” that could link China’s

growing export-oriented economy with international trade. Therefore, Shanghai began to receive

strong support from the central state and there was a conscious effort made to “reglobalize”

Shanghai to reclaim some of its lost international status.

At the national level, since late 1970s, there was a sea-change in the development

philosophy and economic landscape in China. The post-Mao leadership gave importance on

economic reform and open-door policy. This change was reflected in 1984 with the 12th National

Party Congress launching the policy of urban industrial development. The reforms also brought

about two significant changes in China that are important in the context of Shanghai:

decentralization of governance from national to local level and the increasing important of

nonstate actors such as private and foreign investors (Wu 2003).

At the regional level, tidu lilun or the “ladder step” policy was adopted by China, which

prioritized the development of the eastern coast and then subsequently the interior parts of China.

There were three economic belts marked out on the basis of perceived comparative advantages of

each region. The eastern region was to specialize in export-oriented industries and foreign trade,

the central region on agriculture and energy sector, and the western region was to focus on

animal husbandry and mineral extraction (Fan 1995). The export-oriented eastern zone enjoyed

several concessions from the central government in terms of preferential tax treatment, improved

urban infrastructure and easy access to international markets, and professional government

92
services (Wei and Lueng 2005). Subsequently, much of China’s economic growth since the

1980s is said to have been led by the three major regions along the eastern coast, which are

considered as the “growth engines” of China (see Figure 4): the Pearl River Delta region

(PRDR), led by Hong Kong/Guangzhou; the Yangtze River Delta Region (YRDR), centered in

Shanghai; and the Beijing-Tianjin-Tangshan region, also known as the BTTR or the Jing-Jin-

Tang region (JJTR) (Zhang 2006).

Figure 4. China’s Three “Growth Engines”

Source: Zhang (2006:30)

Out of these three regions, the YRDR was considered as the most important area. The

YRDR, especially Shanghai, has been the focus of much research since the 1990s, especially

because of its key role in articulating the high-growth led development in China. Hall (2002)

contends that the region as a whole constitutes a paradigm (“the Yangtze paradigm”) of

economic growth and spatial expansion.67 The region has also been the focus of understanding

China’s urban transition (Friedmann 2005) through the influence of foreign direct investment,
67
Cited in Zhang (2006).

93
inviting terms such as “exourbanization” (Sit and Yang 1997, cited in Zhang 2006). The

dominance of these three regions within the Chinese economy can be gauged from the fact that

although the three regions altogether constituted only 1.61 per cent of China’s territory and 10.08

per cent of China’s population, in 2002 they contributed to 33 per cent of China’s total GDP, 75

per cent of its foreign trade, and 72 per cent of its total exports and attracted 80 per cent of FDI

in China. Among the three the YRDR is the largest, as well as the strongest in terms of GDP and

FDI (Zhang 2006:28).

Implementing the model. Shanghai’s rapid development took place because of the

favorable role played by leaders such as Jiang Zemin and Zhu Rhongzi, who dominated the

Chinese political landscape throughout the 1990s. The transformation of Shanghai was already

conceptualized when Jiang Zemin was the mayor of Shanghai. It was Zemin who introduced a

top-down model of development. In 1986, “A comprehensive development program for

Shanghai” was drafted by the municipal government to transform Shanghai into a world class

city in a relatively short time. This new program outlined two key mechanisms to “leap frog”

Shanghai’s development: first, the internationalization of the economy and second, eliminating

all “backward” and “messy market places” of “unorganized, unlicensed, and unsightly” informal

activities, carried out mainly by rural migrants and peasants. In order to implement this, an

independent super municipal agency was created headed by the Mayor. For rapid

implementation of the development program, all urban planning decisions were centralized in

this agency (Huang 2008c:213-14).

Broadly, this new development program implemented in Shanghai marked a shift in the

regional development approach from the traditional “two-track” approach to a “single-track”

approach. The earlier “two-track” approach was based on a differential nature of development of

94
the rural and urban areas. While, market reforms and private sector development was introduced

in the rural areas, there was a continued emphasis of centralized planning in the urban areas. The

new “single-track” approach based on “rural-urban planning integration” made the rural areas

more dependent on the urban areas as it is the urban areas where economic growth began to get

concentrated driven by massive investments in cities, primarily Shanghai. During 1991-2002,

217 billion USD were invested in Shanghai in order to correct the long-term underinvestment in

the city during the Communist planning era. As a result of this political benevolence, Shanghai

was able to register rapid GDP growth and boom in construction during this time. These

investments in the city consisted of a mix of domestic and foreign sources. Domestic sources

included household bank deposits (60 billion USD in 2002) and land user fees. There was also a

significant amount of foreign investments in the city during 1991-2000, amounting to 28 per cent

of the total investments in Shanghai (Zuo and Huang 2005:74-75). Since 1992, Shanghai

attracted over 120 billion USD in total foreign direct investment (FDI) and accounted for 23

percent of China’s total FDI in 2006. More than 50 per cent of the FDI was in manufacturing and

nearly 30 per cent in the real estate (Zuo and Huang 2005: 75-77). In 2004, the annual FDI in

Shanghai was 6.5 billion USD, equal to India’s entire FDI! (Huang 2008c).

Based on the 1986 policy, highly expensive projects were carried out to promote the city

as an “ultra-modern metropolis.” This is reflected in the development of the Pudong New

District which involved the conversion of almost 350 sq km of farmland into a financial and

commercial center in a very short period of time. The Pudong project was primarily a real-estate

led model whereby the government acquired farm lands at very low costs from farmers and

auctioned the land-use rights at current market prices. The money generated from these sales was

to be reinvested in various industrial, welfare, and pension programs. However, the lucrative

95
real-estate developments accompanied by preferential politics led to growing corruption and

crony capitalism. Since July 2006, 8 senior officials in charge of land management have been

arrested in Shanghai.

The real-estate development projects such as Pudong highlight the high-handed approach

of the central government, seemingly seen as an efficient means of “getting things done.”

However, this emphasis on “efficiency” had severe consequences on the urban poor in the city as

the repressive state carried out its “developmental” agenda in a non-democratic manner. Massive

urban renewal projects were carried out to make way for new construction. These projects

involved no public hearings and many marginalized people were evicted swiftly, and most often,

forcefully and violently. For example, during the development of the Pudong District between

1992 and 1997, the government demolished 22.46 million sq miles of building area and 541,400

households were displaced (Huang 2008c:216).

It is noted that Shanghai’s “impressive skylines and the exalted GDP performance” mask

all the troubling realities of Shanghai’s economic growth (Huang 2008a; 2008c). Thus,

Shanghai not only serves as an urban-led model of development, but at a deeper level, it is also a

model that reflects a particular developmental regime that is coastal-based, rural-exploitative,

and thrives on regionally imbalanced development. In the following section, I will provide a

detailed evaluation of the model and also explain why the model still appeals to planners and

government officials, especially in Mumbai.

Evaluating the Shanghai Model of Development

Deep and systematic anti-rural bias of economic policies

Huang (2008c:219) refers to Shanghai as the “consummate urban China” for having drained the

resources of rural entrepreneurs. This top-down nature of policy aimed to increase the pace of

96
urbanization has proved detrimental to the rural hinterland. Huang (2008c) describes this urban-

bias not only as a geographical fact, but an ideology that denotes a strong hand of the state, an

industrial policy mentality, and a bias against low-tech entrepreneurial activities. The rural areas

of Shanghai account for a significant portion of employment (29.7%) in Shanghai. However, if

we look at the fixed asset size of rural Shanghai, it actually declined than the rest of China

between 2001 and 2005, a period when Shanghai’s economy was expanding massively. Thus, we

find that even in the event of an expanding Shanghai, much of the development of the service

industry was based in the urban areas with relatively less opportunities for rural entrepreneurs. In

terms of wages, even though the rural wage incomes were always the highest in the country, the

relative rural income ratio of Shanghai to the rest of the country declined throughout the 1990s.

Thus, even though still the highest, the rural Shanghainese are comparatively poorer than 20

years ago.

Biased liberalization favoring foreign capitalists

The policy of attracting foreign investment in Shanghai proved disastrous for local

entrepreneurs. The logic of generating foreign investment was based on the rationale that it

would lead to more jobs for the local people. However, in reality, the heavily subsidized foreign

investors generated only 10 million jobs in Shanghai as against 100 million jobs generated by the

rural entrepreneurs. Further, as per the new economic policy, the FDI was to be mostly invested

in areas where the technology was not competitive, however, most of the FDIs were made in

areas which had little to do with technology and where there already existed a better local know-

how (such as the field of herbal medicine). Moreover, the privileging of foreign investors also

led to various malpractices in business such as the “round-trip” FDIs, where local entrepreneurs

in order to circumvent the system would redirect their investment from a location outside China

97
so that it appeared to be “foreign.” Finally, Shanghai compared to the other first-generation

Special Economic Zones (SEZs) such as Shenzhen, Zhuhai, Xiamen and Shekou faired much

worse in terms of maintaining a balance between attracting FDIs and nurturing local

entrepreneurial talent (Huang 2008c).

Rising unemployment

The Shanghai model of development was premised on the notion that it will generate

employment. However, it has not lived up to its ideals as the generation of employment based on

the service sector has been negligible. The urban employment increased from 5.20 million in

1990 to 5.73 million in 2002, compared to almost four times increase in the real output. As a

result of this slow growth of employment, the unemployment rate in Shanghai increased almost

four times from 1.5 per cent to 4.8 per cent in the period 1990-2002 (Zuo and Huang 2005).68

Further, the employment in the primary sector dropped from 12.3 per cent to 11 per cent, while

that of the service sector increased from 29.3 per cent to 48 per cent. Thus, even though there

was employment generated in the service sector its contribution was marginal to the overall

employment situation in the city.

Jobless growth

The Shanghai model is a peculiar case of jobless growth. While the six pillar industries of

information technology, automobiles, petrochemicals, steel, assembled equipments, and bio-

medicine grew rapidly (60 per cent of total industrial output by 2002), they accounted for only

30 per cent of industrial employment. On the other hand, industries such as textiles, household

appliances, and other light industries suffered most severe job losses, with almost 60 per cent of

the 1 million or so lay-offs concentrated in the state-owned enterprises (SOEs) during 1990-98.

68
The figures do not include the number of jobs lost in the state-owned enterprises. It is argued that if these numbers
are included the unemployment rate would double (Zuo and Huang 2005)

98
Further, the model is also uneconomic in the sense that it is not based on the idea of fair

competition. The rapid growth of FDI in Shanghai based on preferential policies puts the local

industries and entrepreneurs at a disadvantage (Zuo and Huang 2005: 79).

Anti-poor growth

Huang (2008c) highlights, since 2000 the poorest section has lost absolute income during a

period of the double-digit economic growth in Shanghai. Much of China’s poverty reduction

occurred in the 1980s, before the reforms. In fact, Huang argues that poverty reduction slowed

down dramatically since 1990s.69 Huang (2008b:46) states that “Shanghai is rich, but an average

Shanghainese is not.” Even though Shanghai’s GDP was 5.2 times higher than China’s GDP, if

you disaggregate the GDP data based on an income approach rather than an expenditure

approach you find that the employees did not benefit much from this growth, while most of this

growth went to the government and state-controlled firms. In 2004, employee compensation was

40 per cent of the net regional product, whereas corporate profits were 30 per cent and

government taxes constituted 28.9 per cent of the net regional product (Huang 2998c:182). If we

look at the income differences between the rural and urban areas we find that the ratio of urban

versus rural per capita income grew from 1.8:1 in the early 1980s to 3.23:1 in 2003. The world

average for this period was between 1.5:1 and 2:1 (Guerrero 2007).

The worst affected people from this model are those that are classified as “floating

residents,” which includes low-skilled workers who do not have legitimate household

registration. The current policy related to compensation in Shanghai excludes this category of

tenants and thus there is no compensation given to them in the event of urban renewal. Thus such

“illegal” structures are demolished without any compensation, cash, or resettlement (Li 2005:

69
In this context, Huang (2008c) argues that the government revised its poverty thresholds several times so
statistically more people were shown to come out of poverty (p. 186).

99
162). The people in the rural areas too face exploitation at the behest of the nexus between the

state officials and private developers. The state officials in order to speed-up the urbanization

process transfer rural land from farmers’ collectives at a relatively low price and resell it to

private developers at market price creating resentment among the farmers (Li 2005:163).

The economic reforms have also affected the housing market which is becoming

increasingly privatized. This has led to the “rolling back” of the state in public housing provision

leading to proliferation of gated communities of commercially developed housing estates (known

locally as xinjian zhuzai xiaoqu). These forms of spatial practices are further increasing the gap

between the elites and the urban poor in the city such as the migrant workers, who are now seen

by the rich, gated elite as the moral “other” (Pow 2007).

Ecologically unsustainable

It is argued that the high-growth led development model of China is ecologically unsustainable

and reckless and is putting the country and the world on the brink of environmental catastrophe.

The Pearl River Delta and Yangtze River delta, the two regions which have experienced the

recent export-oriented growth, suffered from extensive contamination from heavy-metal and

persistent organic pollutants. Further, changing lifestyles, increasing middle-class families, and

the growing consumption-driven economy in China is also causing a lot of ecological concerns.

For example, in Beijing alone, 1,000 new cars are added to the roads every day. Seven of the 10

most polluted cities in the world were located in China (Guerrero 2007).

Experimentation or blueprint?

It has been argued that the Chinese model of development led by Shanghai is unique, based on

experimentation and a “high degree of tacitness” involving local knowledge and particular

conditions of China. Therefore, it was not based on any form of a “blue-print” of development.

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However, if we consider the large-scale projects such as the Pudong New District, aimed at

revitalizing cultural lifestyles, this experimental nature of the model is questionable. Especially,

if we focus on what cultural lifestyles are being revitalized and who are the people who benefit

from those. For example, if you take the case of Thames Town, one of the nine new towns in the

suburbs where almost 500,000 people are being resettled, the elitist and west-centric nature of

place-creation is apparent. Each of these nine towns is built in a distinctive style that includes an

Italian town with canals based on Venice and a German town designed by Albert Speer, the son

of Hitler's favorite architect. In one of the articles on Thames Town, the author states that it

features “cobbled streets, half-timbered Tudor houses, Edwardian townhouses, and a covered

market with a clock tower and weather vane on top. Thames Town looks like an English country

town. And that was the whole idea, to re-create Middle England in the Middle Kingdom” (Lim

2006). The same author also states that some critics have denounced the satellite town scheme as

a form of self-colonization of placing fancy foreign settlements above the real needs of its own

people. From this example it is clear that even though scholars would like to convince people of

merits of economic growth based on Chinese particularism, the real picture on the ground tells us

a different story. A story in which development is a code-word for building spectacles such as

the Thames Town or the Pudong District to satiate the thirst of the elites for western ideas and

images at the cost of most of its less fortunate people.

Why is the Model Still Appealing?

If we have seen so far that the Shanghai model of development is anything but comprehensive,

just, equitable, and economically and ecologically sustainable, why is it still appealing to people

within and outside China, especially Mumbai? There can be several explanations for this.

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Shanghai: a symbol of high-modernity and a “resurgent Asia”

At the level of popular imagination, Shanghai (and the model) represents a symbol of a

“resurgent Asia,” especially China. Some argue that the Shanghai makeover was a result of both

a means to restore its past glory (seen as reconstructing Pudong as a “21st century Bund”) and

also a more active process of becoming a “dragon-head” connecting the economy of China with

the rest of the world (Wu 2003). Post 1990s, Shanghai has reemerged as the symbol of Chinese

high-modernity.70 Roy (2011) has argued that such “reference urbanism” is aimed at producing

an “Asian urban capitalism that self-consciously presents itself as Asia, that deploys the motifs

of the Asian century and that references other Asian models.” Therefore, somewhere within the

celebratory and assertive tone of a “rising Asia,” Shanghai emerges as a model that represents a

non-Western example of successful economic growth in the developing world. Further, it is

perceived as an example of the East charting out its own developmental course without having to

depend on Western models. In India, the rising power of China is acknowledged at the level of

foreign policy with the emphasis on the “look east” policy that aims to deepen economic and

cultural ties with China. In the above context, Shanghai symbolizes the new axis of power.

The political dimension

Along with this symbolic dimension, we also need to understand the role of politics in Shanghai.

Shanghai has been a breeding ground for leaders of the CCP and a route for the local leaders to

vest political power at the center, prime examples being President Jiang Zemin to Premier Zhu

Rongji. Thus, what happens in Shanghai is closely monitored at the center. It is argued that it

was the powerful political position of the city that paved the way for the development of the real

70
Discussing the role played by transnational actors, especially the non-Chinese design professionals in the
development of Lujiazui in Pudong district of Shanghai, Olds (1997) highlights how the Shanghainese planners and
politicians wanted the CBD to express the goals and successes of the reform era through gleaming skyscrapers.

102
estate market in Shanghai, where Shanghai was granted much more flexibly to liberalize its real

estate market and attract foreign investment.

The ideology of fast-growth

Outside China, people in India are enamored by the Shanghai model and want to replicate the

model in Mumbai. However, if we analyze the urban planning discourses closely (as I will show

in the next chapter) we find that one of the most crucial features that stand out is the idea of fast-

growth: of completely transforming Mumbai into a world class city in a span of 10 years. This

ideology of fast growth is based on the idea of integrating Mumbai with the global economy. In

this context, the Shanghai’s appeal as a “blue-print” lies in its ability to transform itself in a

relatively short period of time.

GDP growth rates and the tyranny of numbers

I think a significant part of the appeal of the model lies in its spectacular aggregate economic

performance such as GDP growth rates which serve to justify this model. There have been

several critiques of the GDP as aggregate indicator of overall economic or social health of a

nation. They range from ecological economists (Daly 2005) to feminists (Waring 1999) and have

pointed out that the GDP excludes costs related to the environment, as well as ignore the role

played by female household labor in production. Even though these aggregate economic

indicators have become general standards of economic development, we find that historically

these national accounting systems had been constructed for specific political purposes. For

example, the GNP was initially developed in 1941 to measure national income affected by World

War II and to justify spending on the war efforts (Waring 1999:56). Kuznets who vehemently

opposed this measure wrote in 1945: “I repeat that we are not trying to measure welfare, but the

value of production from a business point of view” (cited in Waring 1999:57).

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 More recently in 2008, the Sarkozy government commissioned a report by a committee

headed by Joseph Stiglitz to identify the limits of GDP as an indicator of economic performance

and social progress and to suggest alternative statistical measurements that could be more

inclusive and comprehensive. The report reiterates the point that the GDP is an inadequate

measure to gauge material well-being over time or sustainability based on economic, ecological,

and social dimensions. One of the criticisms of the GDP highlighted by the report is that it only

measures market production, but not material well-being. This can give misleading information

on how well-off people are and therefore lead to wrong policy decisions. Further, the report

argues that measures like GDP do not take into account crucial information such as the unequal

participation in production or consumption or the impact of excessive productivism and

deregulation on the society and the environment. As a result of this, measures such as the GDP

have failed to make us aware of the limits of consumption of essential goods and the fact that the

cost of this overconsumption is borne by the most disadvantaged groups all over the world

(CMEPSP 2009).

Thus, although statistics such as the GDP may not mean much from the viewpoint of

comprehensive development, they are still hegemonic in shaping people’s perceptions regarding

economic growth and development. Along with shaping people’s perceptions, the hegemonic

role of these measures can be observed in monitoring growth, setting priorities in policy making,

measuring the success of policies, and measuring economic and social welfare in general. As a

result (as we will see in the next chapter), despite the fact that the impressive double-digit growth

rates accompanied a lot of costs, such models are uncritically accepted.

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 CHAPTER 4

SHANGHAIZATION OF MUMBAI:

VISIONS OF A “WORLD CLASS” MUMBAI

~I am convinced that a historic opportunity for the revamping of Mumbai presents itself before us
today. Mumbai can emerge as a new financial capital of Asia, and be the bridge between Asia and
the West in the world of finance….I do believe that Mumbai can learn from Shanghai’s
experience in reinventing itself; in rebuilding itself; in rediscovering itself. I urge every
Mumbaikar to transform this city from being a Gateway to India to becoming a Gateway to Asia!
(Manmohan Singh, Prime Minister of India 2006).71

There have been numerous studies that have focused on the contemporary urban restructuring in

Mumbai (Banerjee-Guha 2002; Gandy 2008; Harris 2008; Nijman 2008; Zérah 2007). However,

barring a few (Anjaria 2009; Harris 2008), there has been a relatively less focus on

systematically understanding the contextual, agential, and processual aspects of contemporary

urban transformation in Mumbai. Therefore, it is important to understand the context in which

the urban development discourses emerges, who has the power to formulate these discourses,

and how these discourses are mobilized to facilitate urban change. In doing this, we can get a

clearer insight into the ideological underpinnings of these discourses in terms of whom they

include and exclude and whose interests they serve and disserve.

Therefore, in this chapter, I systematically analyze the material contexts, agency, and

processes surrounding Shanghaization of Mumbai, a term that is broadly used to describe the

imaginaries and strategies of remaking Mumbai as a “world class” city and to transform the city

into an “international financial center.” The chapter highlights how these primarily

71
Prime Minister Dr. Manmohan Singh's address at the 16th Asian Corporate Conference, “Driving global business:
India's new priorities, Asia's new realities,” March 18, 2006, Mumbai. Retrieved March 27, 2012
(http://www.indianembassy.org/prdetail931/--%09--prime-minister-dr.-manmohan-singh%27s-address-at-the-16th-
asian-corporate-conference-driving-global-business-%3A-india%27s-new-priorities,-asia%27s-new-realities).

105
entrepreneurial visions of “world classing” Mumbai were formulated by the state (national and

local) in collaboration with sections of the local elite in the city, which include some of the city’s

prominent business organizations, NGOs, and individuals. In this regard, the chapter focuses not

only on the “products”—the texts produced by these agents, but also on the “processes”—the

negotiations within the emerging networks that materialize these visions. Some of the key

questions that are addressed are: What are the structural factors that enable contemporary

“worlding” of Mumbai? How do these structural factors interact with local actors in shaping the

hegemonic discourses of “worlding?” What are the developmental visions espoused by these

discourses? Are these visions inclusive and broad-based or do they reflect narrow power

interests?

An Agential Understanding of Urban Change

The mainstream literature on urbanization primarily focuses on accumulation and ignores the

political and local-historical contexts of “global cities.” In doing this, it gives more importance to

the power of global actors and institutions, and underestimates local agency and contingency

(Shatkin 2007:1). Unwittingly, cities are reified as abstract economic spaces, devoid of people

and agency. Therefore, there is need for an “actor-centered” urban analysis where diverse local

actors such as developers, emerging consumer classes, local and national governments, and

corporate actors are seen as active participants in urban transformation (Shatkin 2007). In this

regard, the “growth machine” literature in the US has highlighted that power to organize city

space (and to imagine a city) is conflict-ridden and involves a wide variety of social actors that

come together to form broader coalitions with the government playing the facilitating role. This

broader coalition usually consists of local chambers of commerce, local financers, industrialists,

business leaders, real estate and property developers, educational and religious institutions, local

106
labor organizations, political parties, social movements, and local state agencies (Harvey 1989a;

Molotch 1976).

Some scholars have used the term “entrepreneurial city” to highlight the processual

aspects of entrepreneurialism in urban development (Jessop 1998a; Jessop and Sum 2000). The

city is, therefore, no longer is just a location where entrepreneurial activities take place, but city

by itself has become an entity that pursues entrepreneurial advantages (Fu 2003:1675). In this

context, the city, just like the firm, has become an entity through which entrepreneurial strategies

are implemented (Jessop and Sum 2000). Jessop and Sum (2000:2289) propose three criteria that

differentiate an entrepreneurial city from a nonentrepreneurial city. They argue that the

entrepreneurial city could be defined as a city that pursues entrepreneurial strategies in an

entrepreneurial discourse or fashion through a promotion of entrepreneurial images.

Thus, summarizing recent studies on urbanism highlight the following features of

emerging urbanism: interurban competition to attract investments and jobs, a shift in municipal

governance from social development to economic development and entrepreneurialism,

increasing importance of real-estate development in the urban economy as expressed in urban

renewal, “privatization of planning” involving an entrepreneurial stance to economic

development through innovations and public-private partnerships and privatization of urban

services (Brenner and Theodore 2002; Harvey 1989a; Leitner et al. 2007; Molotch 1976; Shatkin

2007; Smith 2002).

Shanghai’s Reglobalization Strategy

As highlighted in the earlier quote of the Indian Prime Minister, the attempt to make Mumbai

“world class” by “reinventing, rebuilding, rediscovering itself” just like Shanghai. Therefore, the

attempt to position Mumbai as the “new financial capital of Asia” can also be seen a way to

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reglobalize the city by strategically reintegrating the Indian economy with the world in a new

finance-driven world economy. In this regard it wants to emulate Shanghai’s recent experience

of reglobalization based on the “dragon’s head strategy.”

In a famous 1992 speech, Deng Xiaoping announced that Yangtse River Delta (within

which Shanghai is located) would serve as the “dragon’s head” and lead China’s modernization

(Wasserstorm 2003:52). This was seen as a post-socialist entrepreneurial attempt to reglobalize

Shanghai in order to connect China with the global economy and to restore its prominent

international status (Wu 2003:1686). The “dragon’s head” reglobalizing strategy involved the

construction of a new financial center in Pudong, the use of market-oriented land development to

overcome the initial capital constraint, and government’s strategic investment in infrastructure

development, and mega urban construction projects (Wu 2003). Shanghai, therefore, underwent

a massive urban renewal program and in a short period of time the Pudong region was

transformed from a rural agricultural zone into China’s leading financial district. The enormity of

investment and urban renewal in Shanghai can be gauged from the fact that it was observed that

at the end of the millennium there were about “23,000 building sites and some 20 percent of the

world's cranes” in Shanghai (Wasserstorm 2003:52). This kind of massive construction in

Shanghai is probably unmatched in the history of megacity development. From 1992 to 2007,

Shanghai has experienced the fastest economic growth by any megacity in the world, averaging

12 percent annually. Thus, as discussed in the previous chapter, Shanghai’s appeal to planners

and city elite in Mumbai also rests on this dramatic manner in which the city transformed itself

in a relatively short period of time.

One of the strategies of converting Shanghai into a “global city” included creating a new

space for the financial center. In order to raise the capital necessary for this, market-oriented land

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development was encouraged. Further, the government also was involved in improving the

infrastructure in the city to increase the competitiveness of the city. Moreover, a new

decentralized fiscal strategy was devised which benefited Shanghai, which in the days of

centralized planning bore much of the fiscal burden. Further, the central government also

provided generous tax rebates and special subsidies to Shanghai. This increase in local revenue,

along with the generous support of the central government enabled Shanghai to carry out most of

its urban development programs in the 1990s (Wu 2003).

Along with economic reform, there was also a concerted effort made by the municipal

government in Shanghai to promote Shanghai as being international and cosmopolitan just like

Shanghai in the past. Metaphors such as Paris of the Orient” were used to link Shanghai’s global,

entrepreneurial past to the Shanghai that would link China with the world economy. The

following excerpt from address of the municipal government at the eve of the 1999 Fortune

Global Forum makes this point clear:

China is a developing country and Shanghai is doing its best to solve the various problems it
encounters in the course of progress. But suppose you have a preoccupied impression of the
developing countries, and are full of mysterious images of early Hollywood’s films, then when
you come to Shanghai for the first time you may be puzzled by the skyscrapers as those in
Manhattan, surprised at the three dimensional road system in the city or amazed at the well-
dressed and happy people, as it is a modern city in the sunshine, greatly different from what
you’ve imagined......Shanghai has modernized museums, grand theatre, and libraries; Shanghai
possesses its own English newspaper, English broadcasting and TV programs; you can
conveniently watch foreign TV programs; Shanghai’s internet channels you to the world; besides
luxurious hotels and restaurants, there are also special bars and eating places of European,
American, Thai or Mexican style (Cited in Wu 2003:1688).
The above quote highlights the fact that in order to attract foreign investment to the city, a new

urban image of Shanghai was being created. It is found that in most of such place promotional

literature there were two recurring themes: first, the “city of work,” which highlights the pro-

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business environment of the city and second, the “city at play” that aims to attract global

investors to the city by highlighting global lifestyles.72

David Harvey (2005:39) argues that in a democratic political context, the neoliberal

project had to be established through a construction of political consent across a broad spectrum

of people. He argues that in this construction of consent, cultural values, fears, and the political

rhetoric of “freedom” were employed to justify neoliberal ideas and to create a “common sense”

(Gramsci 1971; Laclau and Mouffe 1985). This neoliberal common sense was based on a

supportive public opinion created through a circulation of these ideas in corporations,

organizations of civil society, and various intellectuals and their think tanks with the help of the

media. However, Harvey further argues that this process of active construction of consent has

shown a considerable degree of variation and it is important to understand the specific conditions

within which this consent is constructed.

Mumbai’s “Art of being global”: The Genealogy of the Shanghaization Discourse

For a summary of the following discussion see Table 6.

The material contexts of Shanghaization

The Shanghaization discourse as a “city-centric growth strategy” is articulated within a specific

global, national, and local context (Kennedy and Zérah 2008). Certain key trends at the global

level bear heavily on the developments in Mumbai: increasing mobility of capital; new

international division of labor; privatization and the rescaling of the state; and deregulation and

opening of the national economies.

72
Short and Kim (2000) cited in Wu (2003:1689).

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 Table 7. Genealogy of the Shanghaization Discourse
Material Contexts
Global Growth of emerging economies (1970s)
National New Economic Policy (1992)
Political reforms (1992)
Local/urban Decline of manufacturing and increase in
finance and service (1980s-90s)

Real estate boom (1996)

Rise in middle class consumption (post

1990s)
Connections and Consent (Actors/Processes)
1993 McKinsey & Co. SICOM Report

1995 Bombay First (think-tank of BCCI) formed

Visits by Mayor of London and City of

1997
London Corporation
September 2003 Vision Mumbai Report by McKinsey & Co.
Government of Maharashtra Task Force
February 2004
Report
October 2004 PM’s speech—Shanghai
Slum Evictions—90,000 homes of slum
November 2004—March 2005
dwellers demolished
Ministry of Finance Report on Mumbai as a
2007
Financial Center

The growth of emerging economies was related to the economic fortunes of the advanced

economies. After 1970s, in the context of declining industrial productivity and interest rates in

the advanced economies in the North, countries in the South were seen as potential markets for

the American investors. Further, facilitated by the advancement in technologies of transport and

communication, emerging economies also became centers of production and investment due to

the low supply of capital and higher returns to investments (Schwartzman 2004). However,

global capital mobility requires a convergence of markets which further requires fundamental

reforms in the political and economic systems. In India, this process of economic reforms began

111
in the 1980s, but the official policy of liberalization and privatization was announced in 1991.

Further, in 1992, as part of the structural adjustment program to facilitate economic

liberalization, the central government announced a policy of political devolution of authority

through 74th Amendment Act to enlarge the scope of municipal institutions. These reforms have

transformed the institutional framework of urban governance in India and have created the

conditions for increasing private sector involvement in policy-making and implementation.

Along with the above mentioned structural changes, there are local socio-spatial and

cultural factors that have shaped the emerging “world class” discourses in Mumbai. First is the

shift from manufacturing to finance and services. This not only affected the working classes in

the city, but also radically transformed the built-environment in the city. Harvey (1989) argues

that space is constantly reproduced to accommodate increasingly dispersed capital. According to

him, mobility of capital is only made possible by production of relative stable and immobile

geographical landscapes such as the built environments, transportation infrastructure, production

and business complexes, and communication networks. In Mumbai, the decline of manufacturing

“freed-up” huge tracts of lands in the city for redevelopment due to the closing of the textile

mills. Due to political lobbying by mill owners and real estate developers and directives from the

central government, the state government amended earlier protectionist land related legislations

such as the Development Control Rules of 1991. The state government also scrapped the Urban

Land Ceiling Act. These changes facilitated the sale of 600 acres of mill lands and it is estimated

that an additional 25,000 hectares of land would be “freed-up” to attract foreign investors in real

estate development.73 The shift in the urban economy toward finance and services has increased

the demand for office space in the city. This led to steep rise in the real estate prices. In fact, in

73
Krittivas Mukherjee and Devidutta Tripathy. 2007. Maharashtra scraps land law, property prices rise. November
29. Reuters, India. Retrieved March 9, 2011 (http://in.reuters.com/article/2007/11/29/idINIndia-30749620071129).

112
1996, some of the world’s highest real estate prices were reported in Mumbai as a result of

increased speculation. This speculation was a result of the optimistic climate created for foreign

investors and entrepreneurs by the economic reforms in 1991. However, along with foreign

investors, local actors such as realtors and developers in association with local governments and

public agencies played an important role in this speculation (Nijman 2000). The decline of

manufacturing and rising real estate prices led to a relocation of industry outside Mumbai leading

to the decreased competitiveness of the city vis-à-vis other cities such as Bangalore and

Hyderabad. As a result, for the first time, the city experienced negative growth rates in the late

1990s (D’monte 2002). This declining growth provided the immediate context within which

visions of radically transforming the city were imagined by the city’s economic elite who had

high stakes in a “world class” Mumbai.

Economic reforms mostly benefitted the urban middle classes as seen in their rising

incomes (Fernandes 2004; Nijman 2006). In Mumbai, this has led to a social polarization of

classes in terms of “middle classes pulling away from the poor and low-income areas” (Nijman

2006:773). Along with this, there has been a significant increase in middle-class and upper-

middle class credit-based consumption driven by financing, marketing, and advertizing industries

(Nijman 2006). In cultural terms, rising incomes and the spread of a global consumerist culture

has created a demand for better urban services and infrastructure and “middle-class lifestyles,”

promoted by the leisure industry (Falzon 2004; Fernandes 2000, 2004, Nijman 2006). These

growing aspirations of the middle classes is reflected in their readiness in redefining public space

in the city as well as in accepting the rhetoric of a “world class” Mumbai.

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Connections and consent (actors/processes) of Shanghaization

The “global” or “world class” city is no longer merely a heuristic tool to understand the

importance of certain cities in the world economy, but is increasingly used as a benchmark by

certain “wanna-be world cities” (Short and Kim 1999). Mumbai’s “world class” aspirations

began to take shape in the late 1990s, when a set of diverse social actors, guided by the

modernist visions of cities in the West, began deconstructing the innumerable problems that

plagued the city (refer to Table 6 for the following discussion). They began questioning the poor

quality of life, ineffective governance, and the noncompetitive environment in the city. Over a

period of time, there emerged a ”growth coalition” in Mumbai that included city’s industrial and

political elite; professional consultants; multilateral aid agencies such as the World Bank and the

Asian Development Bank; and urban research initiatives such as the Urban Age and the Cities

Alliance.

In 1993, consultancy firm McKinsey & Company published a SICOM (a Government of

Maharashtra owned company) commissioned report for the state, which perhaps for the first time

referred to transforming Bombay into a financial center. Citing Maharashtra’s low ranking in

infrastructure in the 1992 World Competitiveness Report, it recommended several changes in

land and labor legislations to improve state’s infrastructure and create opportunities for

businesses. Thus, Bombay was to act as a source of attracting business in Maharashtra (D’monte

2002). This was an important report as it opened up the discursive space for various private

actors including the local chamber of commerce—the Bombay Chamber of Commerce and

Industry (BCCI) and the real estate companies to weigh in on matters related to city’s

transformation. Post-reforms, these globally mobile actors were keenly following what was

happening to other cities in the West. London was one of the cities that attracted them due to its

114
similarities with Mumbai. Both were port cities, both had experienced recent deindustrialization,

and both had certain strategic geographical advantages (in terms of time zones and location) that

could propel them as leaders in the global financial market. London had successfully transitioned

from an industrial city to a major financial center. A local business partnership called London

First had played a key role in this transformation. Some corporate houses in Mumbai formed a

similar initiative called Bombay First in 1995. Later, Bombay First became a key think-tank of

the BCCI and has emerged as one of the key proponents of the “world class city” discourse in

Mumbai (Harris 2008). For the initial funding for the think-tank, the BCCI approached various

banks (ICICI, HDFC) and corporate houses in Mumbai such as Tata and Mahindra. From the

beginning it was clear that Bombay First wanted to strategically position itself in the fragmented

discursive landscape of the city through conscious image branding. This was reflected in the

choice of its first CEO, Gerson da Cunha, a theater actor, former advertizing professional, and an

activist and trustee of a prominent NGO in Mumbai—Action for Good Governance and

Networking in India (AGNI). da Cunha was instrumental in giving Bombay First a formal

structure and in the constitution of its expert committees.74

However, it was Mr. B.G. Deshmukh, a former municipal commissioner of Mumbai and

Cabinet Secretary (the highest ranking civil servant in the country) who was a key figure in the

formation of Bombay First. After retiring from the civil service, Mr. B. G. Deshmukh joined

Tata Sons (a key promotional wing of the Tatas, one of India’s oldest and largest business

families) as Director of Sales. One of his colleagues, an economic adviser in the same company

who later became a member of the economic committee of Bombay First, describes the earlier

events leading up to the formation of Bombay First, which is worth quoting at length:

74
Sunil Bhandare, personal interview, December 16, 2009.

115
 He (B.G.Deshmukh) saw certain information coming around about London First that used to
appear in the Financial Times. So he used to send us some clippings of that and then he said let us
discuss about it. He said let us think about it. So then we started working on it in the department
of economics at Tata Sales and Services. At that time there was no concept of a Bombay First, it
was just Mumbai’s problems and how Mumbai is going down, because of its industries, because
the textile industry was virtually dead, and many other manufacturing activity gradually started
moving out of the city, which led to the decline and fall of industry in Mumbai. A need was being
felt to have some alternative approach. So then he was able to get like-minded people, including
Jamsheed Kanga, who also was a municipal commissioner of Mumbai at one time but was then
working with the Tata’s after his retirement in the Housing Company. So he and many others
from the Bombay Chambers came together and we had informal discussions and we decided to
meet with some international experts and we called a conference.75
In 1997, Bombay First invited the Mayor of London and key members of the City of London

Corporation to offer recommendations for improving city’s competitiveness. The main task that

lay before the think-tank was to convince the government about the changes that needed to be

done. In this regard, Bombay First began to commission studies that began gathering data on

various aspects of Mumbai such as infrastructure, housing, and governance and simultaneously

began to benchmark these figures against other cities in the West. Mr. Narinder Nair, who took

over as the Chairman of Bombay First in 2002-2003, explains:

We reorganized Bombay First when I took over as a Chairman of Bombay First. So we were
looking at what was ailing in the city, what was wrong, the quality of life was coming down, we
had water problems, sanitation, transport, roads, growth rate had come down to 2.4 percent,
where as the State growth rate was 4.8 and the National growth was 5.5. So we said something is
wrong somewhere, what is wrong? So we went to the government. We met the Chief Minister,
the Chief Secretary, the city Commissioner and told them that the city’s quality of life is not right
and that people are not happy. So we asked them are you aware of what is wrong? They said, ya
(sic), things are not good, this and that, so we asked, are you aware what needs to be done?
Nobody had a clear idea. They said Yes and No. So we said okay, we would come with a
document, and you work with us, on how Bombay could be transformed into a world class city

75
Sunil Bhandare, personal interview, December 16, 2009.

116
 over a ten year period. If we have the document of that sort, the then Chief Minister said that he
would work with us.76
Bombay First later commissioned McKinsey & Company to prepare a report on transforming

Mumbai into a “world class city” in seemingly serendipitous circumstances. In 2003, Sunil

Bhandare, an economic expert at the BCCI (who later became the CEO of Bombay First) met

Mr. Ranjit Pandit a consultant with McKinsey in one of the BCCI meetings. Just two years prior

to that, in a time of economic gloom, McKinsey had prepared a “feel-good” report for the NDA

national government that highlighted that India could achieve an annual growth rate of 10

percent by utilizing its human and financial capital more effectively. Inspired by this report,

Bhandare approached Ranjit Pandit to prepare a similar report for Mumbai; in his words, the

report “lifted the ambitions of growth” for Mumbai.77 Moreover, as McKinsey had also prepared

a document for Maharashtra government 10 years earlier, it was familiar with the institutional set

up of the region. Bombay First also wanted to use the reputation and the international brand

image of McKinsey to strengthen their case. McKinsey prepared this report free of cost for

Bombay First! In September 2003, McKinsey published the report, Vision Mumbai:

Transforming Mumbai into a World-Class City (henceforth the Vision Mumbai report), and

presented it to the then Chief Minister of Maharashtra Mr. Sushil Kumar Shinde. The Chief

Minister, who was keen on implementing the recommendations of the report, announced in his

acceptance speech a Special Task Force. The Vision Mumbai report, is a culmination of the

efforts of Bombay First and gave a concrete shape to its visions of converting Mumbai into a

“world class city” (Bombay First 2003). Following the Vision Mumbai report, the Government

of Maharashtra (GOM) published its own Task Force report in February 2004 which was more

or less a copy of the Vision Mumbai report (Government of Maharashtra 2004). Both these

76
Narinder Nayar, personal interview, December 17, 2009.
77
Sunil Bhandare, personal interview, December 16, 2009.

117
reports have attracted considerable attention from a cross-section of the city including the media,

academic community, activists, and policy makers.

Over the years, Bombay First has been able to successfully network internationally and

build alliances with like-minded think-tanks, professional consultants, international municipal

agencies, and multilateral aid agencies by way of organizing workshops and conferences. In May

2005, Bombay First organized an international conference on urban renewal, “Learnings from

Mumbai,” that had delegates from Australia, Thailand, the US, and the UK (Harris 2008).

Recently Bombay First and London First have jointly organized a series of conferences to deal

with issues of security in the city after the terrorist bombings in 2008. In January 2009, a

conference entitled “Lessons from 9/11, 7/7 and 26/11 for safer cities” was held in London

which included the Commissioner of London, the former Secretary of the US Department for

Homeland Security, Chairman of the committee related to 7/7 London bombings, a member of

the US 9/11 Commission, and the former Senior Adviser to US Department for Homeland

Security. In November 2009, a two-day conference entitled “Megamorphosis: Resurgence of

Mumbai” was organized in Mumbai. At this conference, papers were presented on issues related

to economic growth, housing, education, health care, and infrastructure. All the papers presented

at the conference were prepared by international consulting firms such as KPMG,

PricewaterhouseCoopers, and Delloite and by corporate think tanks such as Bombay First and

Janagraha of Bangalore.

This international networking of Bombay First has helped it tremendously in leveraging

its position vis-à-vis the local and state government and to create the necessary institutional

mechanisms that would enable them to carry out their agenda of urban planning. The two key

channels that were established as a result of their lobbying are the Citizens’ Action Group (CAG)

118
and the Empowered Committee (EC). The CAG is supposed to be a representative advisory body

consisting of diverse members of the civil society. However, its actual membership consists

mostly of representatives of selective government and business friendly NGOs and

organizations. The EC is a much more powerful decision-making body and is even more

selective and is represented by a few prominent people from Mumbai’s corporate sector and a

few government officials. As an urban planner in Mumbai puts it:

What is happening in the empowered committee [is] a mutually beneficial arrangement. The
industry representatives through Bombay First find a good forum (apart from what is on the
agenda) to talk to senior bureaucrats, get established, generally see what is happening. And if they
have any personal thing that needs to be settled then see how that could be settled. Senior
bureaucrats are also happy to be in the good books of senior Industrialists. It works very well and
actually one of the bureaucrats who were championing the whole process of this report [the
Vision Mumbai report] has moved to Tata Realty.”78
In fact, there is an increasing trend of mid-career bureaucrats leaving their prestigious

administrative jobs to join the corporate sector.79 And most of these bureaucrats are joining

various public-private partnership (PPP) initiatives, especially in infrastructure, which require

close collaboration between the government and private companies. In fact the private sector is

actively recruiting these mid-career bureaucrats in order to “facilitate” their working with the

government. One of the corporate executives working in a consultancy firm involved in a PPP in

infrastructure observes:

Former bureaucrats are like our crutches in the corridors of the government and accelerate
processes since they come with a vast knowledge of how the official machinery functions and are
armed with a network of acquaintances in the government.80

78
Vidyadhar Date, personal interview, December 12, 2009.
79
Makarand Gadgil. 2007. IAS loses sheen, corporate catch talent. Business Standard, February 13. I thank
Simpreet Singh for providing additional information.
80
Sreelalatha Menon. 2007. Mid-career mandarins head for India Inc. Business Standard, September 19.

119
Recently Bombay First has been instrumental in shaping the 50 year long concept plan of

Mumbai. Interestingly, since the last two to three years, Singapore is emerging as the long-term

model of development for Mumbai. In the Megamorphosis conference of 2009, one of the

keynote speakers was Mr. Lee Kuan Yew, the longest serving Prime Minister of Singapore and

the architect behind transformation of Singapore. And in 2010, a Singapore-based consultants

Surbana International was selected to prepare the concept plan. Explaining this entire selection

process, Narinder Nayar says:

When Lee Kuan Yew, took over as the Prime Minister in the 1960s, Singapore was in a bad
shape. He said where do I want my city to be in a span of 50 years? So they prepared a concept
plan, based on which they have worked out their ideas. So we were invited to Singapore to see
what they have done. So based on their model, a concept plan should be prepared. Finally the idea
was accepted by the government. We were a part of the process of preparing the plan.
International tenders were invited. 39 companies had responded, national and international, they
were ready to prepare the plan. 14 companies were then shortlisted. Out of the 14, nine eventually
came to make their presentations. For 2 days, senior bureaucrats sat along with Malabar, in one of
the government’s guest house. For two days from 9 in the morning to 7 in the evening looking at
the various proposals Planning is a new subject for people in Bombay, so we asked Singapore
government to send two planners to help us select. So Singapore experts came and they helped us
and out of nine, finally four, were chosen and asked to submit detailed proposals, financial
proposal and out of the four one has been selected.81
The task of Surbana International was to formulate a plan to transform Mumbai into a world

class metropolis by 2052. It presented its plan to the government in March 2011. Some of its key

recommendations were: to decongest the city and improve the quality of life by building planned

urban conglomerates in the suburbs of Mumbai, increasing the FSI (up to 15 in some areas), and

to reclaim land from the sea.82

81
Narinder Nayar, personal interview, December 17, 2009.
82
Chittaranjan Tembhekar and Ashley D’Mello. 2011. Future city: taller, wider and faster, The Times of India,
March 5.

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Interrogating Emerging Developmental Visions of Mumbai

Along with material practices, discourses play a very important role in any power struggle. It is

the everyday exchanges that opinions are formed and perceptions shaped. Rather, than viewing

social practices as being antithetical to each other, they reinforce each other. Michael de Certeau

has highlighted how discourses “open a field” for social practices (Certeau 1984:125). Therefore,

language is not merely expressive, but also productive. Studies have shown that language plays

an important role in shaping urban transformation.83 In the following section, I critically analyze

recent discourses of urban transformation in Mumbai and in doing this I will try to highlight the

ideological biases that shape their visions of “worlding” Mumbai.

“Vision Mumbai” (1993-2007)

The MMRDA 1996-2011 Draft Plan, published in 1995, asserts that Mumbai can emerge as an

“international city” based on “growth of financial and business services, and hi-tech, export-

oriented industries.” In order to do so, the plan recommends “increased investment by private

sector in infrastructure and other developments, appropriate structural changes in the Region’s

economy, and adoption of land use policies that respond to market potential” (MMRDA

1995:i).84 This implies removal of all regulatory, political, and infrastructural barriers that hinder

the process of attaining “international city” status. In many ways, the plan replaces the objectives

of earlier 1973 plan that emphasized dispersal and decentralization of industry and a much wider

vision of providing infrastructure and employment to larger sections of the city. The new plan

emphasizes on centralization, financial investment, and a consolidation of trade, services, and

industry as per the agglomeration logic (Banerjee-Guha 2002).

83
For example, Caldeira (2000) shows how the fear and talk of crime organizes and shapes the urban landscape and
public space in São Paulo.
84
The MMRDA, the region’s premier implementing agency, was founded in 1973 and since then every 10-15 years
it has formulated a draft plan for regional development. It first draft was published in 1973 and the second in 1995.

121
 The Vision Mumbai report of 2003 has the goal of “transforming Mumbai into a world

class city with a vibrant economy and a globally comparable quality of life for its citizens.” The

report claims that through its comprehensive vision, Mumbai can transform itself into a “world

class city” within a 10-15 year time-frame (Bombay First 2003:vii, emphasis added). Some of its

main recommendations are: increasing land availability by 50-70 per cent; constructing one

million low-income housing units for slum-dwellers; creating “islands of excellence” (up-scale

residential and commercial spaces); and redevelop the city block-by-block (2003:20-23).

In 2005, during the budget speech India’s Finance Minister Mr. P. Chidambaram

announced the plan of converting Mumbai into an “international finance center” and of making

financial services the next growth engine for India. To that effect, a committee (Percy

Committee) was appointed to recommend relevant reforms. Along with the usual financial sector

reforms such as full capital account convertibility, abolition of securities transaction tax and

stamp duties, and streamlining public debt, the committee also recommended construction of

premium infrastructure in the city citing similar efforts of other financial centers such as London

and Dubai. The committee specifically recommended the building of new roads, expressways,

and water-borne transportation. Along with infrastructure, the committee also recommended

creating more office space in the city by scrapping old laws that regulated land ceilings such as

ULCRA. According to the committee, almost 40 per cent of the demand for commercial office

space came from the financial services sector and that the city can absorb almost 10-15 million

square feet of additional office space.85 However, the recommendations of the committee were

contested by various regulatory authorities. A clear division of opinion emerged between the

bankers and the regulating authorities such as Securities and Exchange Board of India (SEBI)

and the Reserve Bank of India (RBI) over issues related to regulation of financial instruments
85
“Mumbai: An International Financial Center—Special Report.” Business Standard, April 4, 2009, p.4.

122
and the issue of control resulting from full capital convertibility. For the bankers without full

convertibility it was impossible for Mumbai to emerge as an international financial sector, while

the regulating agencies such as the RBI was wary of malpractices resulting from deregulation

and preferred partial regulation without relinquishing its control over the financial markets.86

In 2007, the Ministry of Finance published the Report of the High Powered Expert

Committee on Making Mumbai an International Financial Centre. The report envisions a

creation of an International Financial Center in Mumbai as a route to faster deregulation,

liberalization, and globalization of the Indian financial system. It envisions that Mumbai will

play a very important role in bringing about a “financial revolution” in India (Government of

India 2007: xiv-xv). The report argues that India should “move up in the value chain” from low-

value knowledge/business processing (BPO and KPO) to a high-end producer and exporter of

international financial services (IFS). It argues that financial services tend to get concentrated in

a small number of “imaginative people” such as lawyers, accountants, financial and tax experts.

These people have extended networks with clients all over the world, but their nature of job

demands that they have “intensive interaction”, “inter-personal information flows,” and

“complex negotiations” (Government of India 2007:xv). An IFC is most suited for such

economies of agglomeration.

Fast-growth

To instill a sense of urgency for Mumbai’s rapid transformation both the reports employ a

strategy of fear that describes Mumbai as a city heading towards a catastrophe. The

contemporary moment is described as a “tipping point” in the history of Mumbai that warrants

immediate implementation of the recommendations of the reports. The Vision Mumbai report

states that “Mumbai is currently at a critical juncture. It must implement the eight initiatives

86
Ibid.

123
outlined...and it must do it now. Otherwise it is in grave danger of collapsing completely”

(2003:2, emphasis added).The GOM report too uses a similar language: “Mumbai hovers

perpetually on the brink of collapse…In this moment of promise and peril…if it neglects to

change course, it risks entering the graveyard of failed cities…Mumbai stands in urgent need of

a game plan” (2004:2, emphasis added).87

The reports endorse fast growth policies that are expected to yield instant results. Thus,

reform must come in “leaps,” “step jumps,” and “quick wins” through a “fast track” and not

through “incremental changes.” Some of the examples of “quick wins” that the GOM Report

argues will help build credibility for change are: beautification of Marine Drive (one of the most

upscale localities in Mumbai), the “Mumbai Chakachak” clean-up project, and improving the

airport ambience.88

Elitist/middle class bias

Both the reports have a distinct elitist and west-centric bias and cater to the affluent sections of

the city that are connected to the emerging consumerist, high-wired economy. For example,

some of the 23 “quick wins” listed by the Vision Mumbai report are: developing the downtown

area (e.g., creating the “Rock and Roll Hall of Fame”); building world class multi-purpose

indoor stadium, conventional center, and housing project; improving airport ambience; creating a

world class commercial district with restaurants and cafes (2003:10&28). Further, the world

class “standards or benchmarks” are based on “quantitative aspirations” derived from a survey of

ten cities, mostly in the West. Thus, growth and development is seen through a modernist lens

87
On this account, it is interesting to note that the Vision Mumbai report was published in September 2003, while
the GOM Report in February 2004. Thus, even though the latter claims that a lot of time was spent deliberating on
the far reaching recommendations of the former report, the GOM Report was signed in just over four months!
88
Chakachak literally translated means clean, swanky, or polished.

124
that insists on “catching up” and bridging the “gaps” between current (underdeveloped) and

world class (Western) standards.

The elitist bias of the emerging growth visions is also seen in the hegemonic “one vision

for the city” that clearly differentiates between “city of slums” and “city of homes” (thus slums

are not considered as homes) and “low-value-added labor” and “high-value-talent” (thus low-

value is devoid of any talent).89

This elitist bias is further revealed in the discussion of new urban infrastructure in the city

that essentially centers on premium infrastructure. In order to create such an IFC, the Ministry of

Finance report calls for an “enabling” environment from the state. This includes broader reforms

in the financial system in India and improving Mumbai’s infrastructure and political and

administrative governance. These reforms, the report argues, would help to attract a “globile”

(globally mobile) financial workforce. In this context, the report states:

The individuals that Mumbai must attract (and who matter most) to be globally competitive in
providing IFS-are affluent, mobile and multi-culturally inclined in terms of their habits, tastes,
and preferences. They demand world class facilities to live, work, and play, as well as world
standards of infrastructure and urban governance. They have ample choice in terms of where they
(and their families) choose to be located and how their time is allocated. Whether they choose to
locate in Mumbai will be influenced by the attractions of Mumbai as a global city in which they
can live, work and play in a manner similar to what they can do in other GFCs (Government of
India 2007:xxix, emphasis added).
In order to ensure that these “VIPs” consider Mumbai as their destination, the report further

provides additional recommendations related to infrastructure, a cosmopolitan culture, lifestyle

facilities, and governance (Government of India 2007: xxix-xxx). In terms of improving

Mumbai’s infrastructure it calls for high-speed roads/urban expressways; good quality airports

and air connections; high-quality residential, commercial, shopping, and recreational space that

89
See GOM Report (2004: 4) which contrasts between the Indian and world class standards.

125
meets “global standards for construction, finish, and maintenance.” It recommends that the

government becomes more “expatriate friendly” by providing user-friendly visas and exhibits a

“gentle, tolerant, open, and welcoming culture.” In terms of lifestyle, facilities concerning human

welfare need to be “brought up to world standards and run on world class lines.” These lifestyles

of human “welfare,” include, along with hospitals and educational facilities, “recreational

facilities” such as sports stadium, gymnasiums, parks, clubs, hotels, bars, racecourses, casinos

and “cultural institutions that cater to global tastes” such as libraries, art galleries, and museums.

Finally, the report emphasizes that the quality of governance, personal security, and law

enforcement needs to improve dramatically from “third-world to first-world standards.” This in

its own words, Mumbai needs to become a “first-world city that can attract the brightest minds of

the world by being an attractive place to live, work, and play” (Government of India 2007: xxxi)

Urban entrepreneurialism and quality of life

One of the frequent development tropes used to justify Mumbai’s transformation agenda is that

of the “poor as an entrepreneur.” This has further gained currency in recent times through

notable films on Mumbai, such as the “Slumdog Millionaire.” This idea of the “poor as an

entrepreneur” is rooted in an ideology of consumption that reduces the identity of the poor to

merely a cog in the accumulation machine, rather than a right-bearing human being. This point is

clearly highlighted through the following example from a presentation of the Chairman of the

Bombay First, made at an event sponsored by Cities Alliance and the World Bank in Washington

in 2010. The Chairman begins his presentation by this quote:

What do you call a city that’s a magnet for the corporate world, a financial rival to the top cities,
a city built on hopes, dreams, and aspirations, a creation of human energy and ingenuity…a city
that’s always open for business?90

90
Narinder Nair, “Public Private Partnership Success Story for Regeneration of a Metropolis,” Bombay First,
Washington, April 26, 2010.

126
Later in the same presentation, the Chairman lists among other people the following that “keep

Mumbai running” (note the machine analogy in the first two):

• The coolie…the human baggage trolley

• The taxi driver…who needs GPS with him around?
• The fisherwoman…expert in the fine art of negotiation
• The dabbawalla [lunch box-carrier]…makes sure city workers get their lunch on time (he
also cites that this service has earned a six sigma rating from Forbes magazine -for
99.99% efficiency)
Further, in driving home the point that Mumbai is a land of opportunity for everyone, he says

“even begging pays…Mumbai beggars earn more than $40 million a year.” He does not cite any

sources from where he got this statistic.

Recent political decentralization has enabled the growth of middle class activism in

Mumbai in the form of neighborhood associations. These neighborhood associations have

particularly vocal about the need for better governance at the local level that focuses on “quality

of life” for the city-dwellers. Through an organized network of middle-and upper-middle class

NGOs in Mumbai (such as AGNI, CitiSpace, and Loksatta) neighborhood associations have

emerged as an important pressure group in the city. The issues taken up by these associations

include solid waste management, beautification of space, and monitoring land use and urban

space (Anjaria 2006; Bhowmik 2006); Zérah 2007). The people mobilized through these

organizations mostly belong to the “new middle class” or the traditional English speaking older

residents of the city (Zérah 2007). But how does this “middle-class activism” relate to the larger

politics of “world classing” Mumbai?

In the context of increasing urban entrepreneurialism, quality of life has emerged as a key

feature for measuring the competitiveness of a city (Rogerson 1999). In order to attract

investment and jobs, quality of life is narrowly conceptualized to suit the interests of capital. The

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earlier discussion on the government report to convert Mumbai into an international financial

center clearly highlights this point. However, the neoliberal discourse of quality of life is not

merely rooted in an economic dynamic, but at a much deeper level it reflects a particular cultural

aesthetic and sensibility associated primarily with “western” consumerist lifestyles.

One of the “quick-wins” of “Vision Mumbai,” is to preserve open spaces in the city and

do discourage “encroachment” through “adoption” of recreational space in the city (such as

playgrounds and gardens) by private agencies (NAGAR Newsletter March 2004). CitiSpace or

Citizens’ Forum for Protection of Public Spaces (a prominent NGO in the city) was one of the

key stake-holders consulted in preparing the “Vision Mumbai” report. It claims to have lobbied

for inclusion of the discussion on open spaces in the report.91

CitiSpace was formed in 1998 and consists of a network of 500 resident associations,

community based organizations, NGOs, and commercial establishments.92 The basic philosophy

of CitiSpace rests on protecting public spaces in the city. For this they rely on the provisions laid

out by the land-use planning in the city which reserve public and open spaces such as beaches,

mangroves, and land reserved for public amenities. According to the organization, over the

years, land reserved for public space is siphoned off through “encroachment and land grab,”

primarily through a politically driven process of slum creation and illegal construction. As a

result, CitiSpace has taken it upon itself to preserve open spaces and stop the “illegal

encroachment,” especially by street vendors (Anjaria 2006; Bhowmik 2006). In this context,

CitiSpace has made use of the judiciary (effectively by-passing the municipal authorities) in

energizing some legal orders related to regulation of space in the city. One such legal order was

about creation of hawking zones that would restrict hawking activities to certain designated areas

91
Neera Punj, personal interview, July 15, 2009.
92
NAGAR (NGO Alliance for Governance and Renewal) website (www.nagaralliance.org). Accessed on November
10, 2008. This website is currently unavailable on the internet.

128
in the city. Some scholars argue that these middle class claims over public space are reflective of

the increasing “politics of exclusion” and an “exclusionary form of citizenship” that renders

sections of the urban poor invisible in the city (Falzon 2004; Fernandes 2004). To this effect,

Falzon (2004:159-60) writes:

[T]he middle and upper classes tend to perceive the homeless, slum dwellers, beggars, “urchins,”
and hawkers as undesirables who “encroach” on the city’s public spaces and make it difficult for
the former to lead what they see as a decent, healthy, and safe life. For the elites, life in the city is
a constant siege.
This “politics of exclusion” is rooted in modernist visions of aesthetics, order, and

entrepreneurship that clash with the extreme poverty and squalor found in the megacities of the

South. The following quote from one of the founding member of CitiSpace describes this clash

of sensitivities. The respondent describes her initial reactions on returning to Mumbai after

having spent 11 years in Singapore:

I moved to Bombay and felt my gosh! my gosh! my gosh! I mean wherever I looked, there was
chaos! I remember the broad footpath in front of my house, J. Tata road was huge. I remember
sea of people were using the pavement and going towards Churchgate station. That wasn’t
happening. Road space management wasn’t happening, garbage galore, spit galore, urine and
feces galore. And systems, there was huge break down of systems. Traffic was cut off from my
arterial road, instead morchas (public demonstrations) were taking place there, my footpath was
occupied by street vendors and people were walking on the road (emphasis added).93
This middle-class politics in the city embodies a neoliberal governmentality based on an elite

understanding of city-space, empowerment, citizenship, and human development. As seen in the

activities of CitiSpace, the relationship between the self and space is mediated through a

privileged notion of “quality of life” which has little regard to how the livelihoods of the urban

poor are tied with public space in the city. Moreover, it ignores the appropriation of space by the

encroachment of the rich. The notion of “empowerment” espoused by this middle-class politics

93
Neera Punj, personal interview, July 15, 2009.

129
is based on a “civic governmentality,” which rests on a legalistic idea of rights that is exclusively

based on rights of taxpayers and “law abiding citizens” (Roy 2009; Zérah 2007). In this context,

one of CitiSpace’s key ideas of “empowerment” of citizens is to disseminate information on

citizens’ rights through “user-friendly” booklets (NAGAR Newsletter March 2004). Finally, the

middle class politics reduces human development to development of entrepreneurship and

“upgrading” human capital. This rhetoric of entrepreneurship is seen in the “mainstreaming” of

street vendors by enclosing them in municipal markets. The poverty of street vendors is

explained through their lack of entrepreneurial skills. During an interview, a key member of

CitiSpace expresses this idea in the following manner:

[We are] limiting the potential of the poor to be an entrepreneur and have the capacity to build
personal capacity, business capacity and to use street vending as a means to go places. What I am
saying is let’s be rational....By and large, 90 percent of the population wants to upgrade...And that
is why I want them to be absorbed into the mainstream...Can you imagine, if they hand would
they be able to demonstrate his entrepreneurship services? Oh! it would be an explosion.94
This discourse is part of a wider process that Ananya Roy (2010) refers to as “democratization of

capital” where development related to social services is transformed into development as

integration into the financial markets. Thus democratization of capital is about the economic

freedom of the poor and reconceptualizing the poor as financial consumers. This is achieved

through a kind of “neoliberal populism” that blends free-market ideology and an interest in the

poor to recast economic vulnerability into economic opportunity (Roy 2010: 188, 220).

The Shanghai Model: A New “Blue-print” of Development in India

Shanghaization is not merely a metropolitan imaginary, but is emerging as a national model of

development in India. In 2005, India made a conscious shift in its macroeconomic policy toward

urban centers by announcing the Rs 50,000 crore urban renewal scheme—the JNNURM

94
Neera Punj, personal interview, July 15, 2009.

130
(Kennedy and Zerah 2007).95 For some, it signaled the end of the earlier reformist Nehruvian

attempts that tried to balance growth with distribution through public-sector investment and

regulation of the private sector (Banerjee-Guha 2002; Harris 2008).96 Financing of cities was

linked to certain reforms in governance that would lead to increasing growth in an open

economy. The federal cash transfers under the new scheme accompanied conditional reforms in

the governance structure of the Urban Local Bodies (ULBs) and state governments. Rules related

to urban development were altered. Important land regulations that provided protection against

land concentration (such as the Urban Land Ceiling Act) were repealed. Municipal bodies were

directed to revamp their fiscal mechanisms and enhance their revenues.

The main thrust of this emerging model of urban-led development is on real estate

revitalization and development to spur economic growth, infrastructure and transport

improvement designed primarily to encourage new private (foreign) investment and property

development, and an export-led growth based on forcible land acquisitions and promotion of

Special Economic Zones (SEZs) like China. With the introduction of the SEZ policy in 2005, as

of 2012 there are 143 operational, 584 formally approved, and 45 in-principle approved SEZs in

India.97 Studies have shown that this developmental model has engendered widespread

displacement and regional (urban-rural) and intra-regional (urban poor and the middle/upper

classes) inequities (Aggarwal 2006; Gopalakrishnan 2007; Huang 2008a, 2008b; Krishna and

Nederveen Pieterse 2008; Shrivastava 2008). The next chapter highlights such displacements

caused by the urban projects in Mumbai that relate to infrastructure, slum redevelopment, and

mill redevelopment, within the wider context of an emerging city-centric development in India.

95
Jawaharlal Nehru National Urban Renewal Mission.
96
Jawaharlal Nehru was the first Prime Minister of India and the main architect of India’s centrally planned quasi-
socialist economy.
97
See (http://www.sezindia.nic.in/about-osi.asp).

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 CHAPTER 5

TRANSFORMING MUMBAI: “THE VIOLENCE OF DEVELOPMENT”

~We urgently need new investment in world-class public infrastructure for our cities. We have to
invest in public transport, in roads with space for bicycles and pedestrians, in sanitation, in public
parks, in water bodies in airports, in railway stations, and many other amenities of modern
life….I believe we should have a vision for our cities as hubs of economic activity where citizens
from all walks of life can live and work without difficulty.98

~Mumbai needs investment in urban renewal. Mumbai needs a world class airport. Mumbai
needs better public transport. Mumbai must unlock the potential of its under-utilized assets,
especially land.99

~We built this slum out of a swamp. We paid a slumlord to fill it with soil. That was six years
ago. Now they come and break it down. Nobody stopped us when we built it. We got our election
cards and our food ration cards for a price. I have three children and a husband, who is a trishaw
puller. They can't simply throw us out and take away our lives. We are Indians. We will squat
here. (Biswas 2005)

It is found that “development-induced displacement” is a widespread and growing phenomenon.

While there are numerous beneficiaries of development, the costs are often borne

disproportionately by the poorest and marginalized populations (Robinson 2003:10). The World

Bank has estimated that every year since 1990, about 10 million people worldwide have been

displaced involuntarily by infrastructural development projects. In India alone, an estimated 25

million have been displaced by development projects in the last 50 years. In China, the figure for

the same period is 40 million and almost 13.6 million people have been displaced in 1990s

98
“PM lays foundation stone of phase-I of Mumbai Metro,” June 21, 2006. Retrieved May 15 2012
(http://pmindia.nic.in/speech-details.php?nodeid=328)
99
Prime Minister Dr. Manmohan Singh's address at the 16th Asian Corporate Conference, “Driving global business:
India's new priorities, Asia's new realities,” March 18, 2006, Mumbai. Retrieved March 27, 2012
(http://www.indianembassy.org/prdetail931/--%09--prime-minister-dr.-manmohan-singh%27s-address-at-the-16th-
asian-corporate-conference-driving-global-business-%3A-india%27s-new-priorities,-asia%27s-new-realities).

132
(Robinson 2003:3). People have even used the term “forced migration” to refer to cases where

individuals or communities are “compelled, obliged, or induced to move when otherwise they

would choose to stay put; the force involved may be direct, overt and focused, or indirect, covert,

and diffuse” (ibid:5). Therefore, even voluntary movement may contain elements of coercion. .

In the context of such “violence of development” Rajgopal (2001:A19) writes, “most large

forced dislocations of people do not occur in conditions of armed conflict or genocide but in

routine, everyday evictions to make way for development projects…Indeed this “development

cleansing” may well constitute ethnic cleansing in disguise, as the people dislocated so often turn

out to be from minority ethnic and racial communities.”

The three quotes at the beginning of the chapter highlight the competing visions related to

Mumbai’s contemporary development. The first quote is an excerpt from a speech by the Indian

Prime Minister, Mr. Manmohan Singh, delivered on the occasion of laying the foundation stone

for Phase I of the Mumbai Metro Rail Project. In the same speech he also stressed on the fact that

urban centers in India must be seen as engines of growth and as spaces of “prosperity” and

“progress.” He particularly singles out Mumbai as an embodiment of hope for a resurgent India

and expressed that the city was in urgent need of investment to improve its infrastructure. The

second quote from another speech highlights how “world class” infrastructure is considered as

the antidote to Mumbai’s lagging growth and its aspiration to join to ranks of leading financial

centers in the world. The focus on Mumbai’s urban renewal signals a shift in the overall

development policy in India during the last decade culminating in one of the most ambitious

programs in post-independent India—the Jawaharlal Nehru National Urban Renewal Mission

(JNNURM).

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Production of Space

In the context of contemporary urban transformation, Harvey (2005:3) makes a distinction

between liberalism as a theory of political economy and “neoliberalization” as a process of a

broader “creative destruction” of “prior institutional frameworks and powers, divisions of labor,

social relations, welfare provisions, technological mixes, ways of life and thought, reproductive

activities, attachment to land and habits of heart.” Transformation of urban space is integral in

this process of neoliberization. Acknowledging this fact, there has been a “spatial turn” in the

analysis of contemporary globalization highlighted by terms such as “space-time compression”

(Harvey 1989), “space of flows” (Castells 1989), and “scapes” (Appadurai 1990). Brenner

(1999:42) argues that with the increasing interconnectedness of social relations on a global scale,

space should not be understood as a “static platform of social relations,” but as “one of the

constitutive elements of globalization, historically produced, reconfigured, and transformed.” In

this context, contemporary globalization can be understood as the most recent historical

expression of a longue durée dynamic of continual process of dispersal and concentration of

capital. On the one hand, contemporary globalization is eliminating geographical barriers to

capitalist accumulation, leading to dispersal of capital.100 On the other hand, this mobility of

capital gets re-concentrated through the production of relative stable and immobile geographical

landscapes such as the built environments, transportation infrastructure, production and business

complexes, and communication networks. The “agglomerative effects” of large cities based on

their concentration of large populations and infrastructure facilitates the clustering of economic

activities. Therefore, these large cities become attractive to investors as they centralize factors

such as good quality infrastructure, skilled labor, specialized producer services and markets, and

less tangible goods such as creativity and innovation (Kennedy and Zérah 2008).
100
This is what David Harvey (1989) refers to as “space-time compression.”

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In Brenner’s words, “social space operates at once as a presupposition, medium, and outcome of

capitalism’s globalizing developmental dynamic…[and is] continually constructed,

deconstructed, and reconstructed through historically specific, multi-scalar dialectic of de- and

re-territorialization” (2009:43).

In order to promote this geographical re-concentration of capital, national and local

governments have introduced new strategies of urban development and regulations. Through this

processes of “re-regulation,” states promote globalization and create favorable investment

environments. The competitive climate of globalization within which cities compete for foreign

capital has led to devolution of state power to regional and urban scales, seen in large-scale

infrastructure projects or entrepreneurial initiatives such as public-private partnerships. In the

megacities of the South this has taken the form of reservation of business districts, creation of

new enterprise spaces or Special Economic Zones (SEZs), or high-premium infrastructure

(Kennedy and Zérah 2008).

Emerging City-centered Development in India

Mumbai’s contemporary transformation has to be understood in a broader of context of a policy

shift in India toward city-centered growth strategies (Kennedy and Zérah 2008). The 74th

Constitutional Amendment Act, 1992 introduced a series of reforms related to political

decentralization in India. The act provided the framework for democratic and participatory

planning process at the local level. Several areas of identified for decentralized planning and

devolution of power including economic and social development, regulation of land use and

construction of buildings, urban planning (including town planning and slum improvement and

upgradation) (Sengupta 2006). Liberalization reforms in the 1990s further reinforced the

economic role of cities. Notions such as “urban productivity” and “efficiency” became the center

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piece of urban development policy. However, the foundation for these changes was laid with the

establishment of the National Commission on Urbanization in 1985, which probably for the first

time recognized the role played by cities in economic development, particular large cities such as

Mumbai. Led by the priority of economic development, the commission introduced the criterion

of efficiency in the provision of urban services. These entrepreneurial visions were crystallized

more clearly in the Rakesh Mohan Committee Report on infrastructure, 1996 which called for

more market-oriented reforms. The main focus of the committee was on “commercialization of

infrastructure” through public-private partnerships, commodification of urban services, local

financing through municipal bonds and domestic financial markets. This report is considered as a

key report in the history of urban development policy in India as it introduced a set of new ideas

related to urban policy and infrastructure development influenced by international “best

practices” (Kennedy and Zérah 2008).

The above urban policy reforms culminated in 2005 with the introduction of the

JNNURM. The JNNURM continues with the “cities for growth” agenda by focusing on

upgrading infrastructure of Indian cities to enhance their productivity. The main mission of

JNNURM is “to encourage reforms and fast track planned development of identified

cities….efficiency in urban infrastructure and service delivery mechanisms, community

participation, and accountability of ULBs/Parastatal agencies towards citizens (Government of

India N.d.). The JNNURM effectively links infrastructure financing and governance reforms by

imposing certain conditionalities for central government funds which include mandatory reforms

in rules and regulations of urban local bodies and state governments such as repealing land

regulations, modernizing municipalities, enhancing revenues and fiscal responsibility (Kennedy

and Zérah 2008).

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 It is also argued that the JNNURM strategy was also influenced by the events in Mumbai,

especially the “Vision Mumbai” strategy (or Shanghaization of Mumbai) introduced by political

and business elite in the city during 2003-2005. This point is acknowledged by the head of the

Mumbai Transformation Support Unit—a World Bank-led initiative set up in 2005, immediately

after the introduction of “Vision Mumbai” report:

In a way JNNURM was also conceived as an outcome of what was going on in Mumbai. So the
Central government also saw that after this kind of study that cities are lacking in basic
infrastructure which is required. So that perhaps led to the central government coming up with the
comprehensive scheme of the JNNRUM, which helped in us in taking up a few major projects in
Mumbai.101
Transforming Mumbai: Projects and Displacements

As discussed in the earlier chapter, Mumbai’s current transformation is taking place in a

transformed political, economic, and institutional context characterized by: increasing

involvement of the market and non-governmental actors in planning and implementation and a

decentralization of political authority to local (urban) level, and deindustrialization of the city-

core. In this context, I will analyze the important projects that are currently underway in Mumbai

that potentially intensify the existing socio-spatial inequalities in the city. There projects relate to

infrastructure development, slum redevelopment, and mill-land redevelopment.

Infrastructure development

An important component of the Mumbai transformation agenda is upgrading city’s

infrastructure. Since 2002, there are two large-scale transportation projects that are currently

underway in Mumbai—the Mumbai Urban Transport Project (MUTP) and the Mumbai Urban

Infrastructure Project (MUIP). The World-Bank funded MUTP aims to improve the transport

infrastructure and services in Mumbai, primarily the suburban railway system which is found to

101
U. P. S. Madan, personal interview December 11, 2009.

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be over-utilized beyond its maximum capacity.102The total estimated cost of the project is about

$1000 USD out of which 45 per cent of the total cost ($477 million USD) is to be borne by the

World Bank. The objective of the 600 million USD MUIP is to augment the MUTP by

improving the road networks and traffic dispersal in the city. The project is funded by MMRDA

and envisages construction or improvement of over 450 km of road network during the next five

years.103

However, the implementation of such projects is a challenging task, considering that it

involves displacement of the urban poor, especially slum dwellers. It is estimated that since 2004

311,000 families have been displaced or are potentially going to be displaced by various

development projects in Mumbai (See Table 1). The resettlement of displaced people in Mumbai

has been patchy. One of the most cited internationally-acclaimed successful “people-managed”

resettlement story is the resettlement of 60,000 slum dwellers for the improvement of the rail

network in 1997-98. This resettlement was mediated by non-governmental organizations such as

SPARC and the National Slum Dwellers’ Federation (NSDF) (Patel, d’Cruz, and Burra 2002).

However, by and large, the problem of resettling the displaced urban poor has been especially

difficult considering that a substantially large number of slum dwellers in Mumbai do not have

proper titles to land and in addition to this there are thousands of small, medium, and large

businesses that exist in those areas. Further, there is also a problem of finding suitable

resettlement sites in a densely populated city like Mumbai. Moreover, there are also certain new

challenges in managing post-resettlement issues related to provision of utilities and services to

the new dwellings, people’s access to transportation, and transfer of funds and title deeds.

Women are disproportionately disadvantaged as their new homes are further away from their

102
During peak hours an average nine-car carries around 4,500 passengers, way more than the maximum capacity of
1,500 (Patel, d’Cruz, and Burra 2002:160).
103
MMRDA. Retrieved May 19, 2012 (http://202.54.119.40/projects_mutp.htm).

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places of work and the burden of balancing household responsibilities has made it difficult for

them to hold on to those earning opportunities (World Bank 2007).

Table 8. Development-induced Displacements in Mumbai104

Name of the Project Families Displaced Period
1 Mumbai Urban Transport Project (MUTP) 20,000 2000 onwards
2 Mumbai Urban Infrastructure Project
35,000 2004 onwards
(MUIP)
3 Mumbai Makeover post-“Vision Mumbai” 70,000 December 2004
4 Mithi River Development Project (Phase I) 5,000 May 2006
5 Mahatma Gandhi Path Kranti Yojana 5,000 2007
Yet to be
6 Airport Expansion Project 90,000
implemented
Yet to be
7 Dharavi Redevelopment Project 60,000
implemented
Yet to be
8 Mumbai Metro No data available
implemented
9 BRIMSTOWD 20,000 2007
No data available.
However, 85,000
10 Slum Rehabilitation Scheme resettled till date
(not included in the
total)
Total 311,000

The recently commenced Mumbai Metro Rail Project has the objective of providing rail-

based mass transit connectivity to people within an approach distance of a half to one mile and to

serve the areas that are not connected by existing Suburban Rail System. The total length of the

Metro Rail is about 91 miles and the entire project is to be completed in three phases by 2021.

The entire project cost is estimated to be about 3500 million USD. The phase I of the project

began in 2006. For the phase II, involving a 20 mile corridor from Charkop-Bandra-Mankhurd,

the government has proposed to construct a railcar depot (the most crucial part of the project).105

For this depot, the government has proposed to acquire 140 acres of land in the Kandivali-

104
I thank Simpreet Singh for providing the statistics.
105
MMRDA. Retrieved May 19, 2012 (http://202.54.119.40/projects_metro_rail.htm)

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Malwani area which includes 48 acres of old settlements of Laljipada, Janata colony,

Sanjaynagar, Ektanagar, Azad compound, Gandhinagar, K.D. Compound among several others.

This entire region houses over 20 to 25 thousand families, 200 small and medium size

businesses, and educational institutions such as schools and Madrasas. In 2007, the state urban

development ministry issued a circular announcing the phase II of the project. This circular did

not mention the people who were going to be displaced as a result of the railcar depot. The

government conveniently chose to ignore more than 150,000 people who have been living in this

region since four decades. Laljipada, one of the main colonies with a population of about 15,000

was developed by the poor people who moved into the region. They not only filled up the

wetlands and made the place hospitable, but also created self-employment by establishing small

and medium scale industries in the region. The imitation jewelry business employing 70 per cent

of the people in the region (out of which 15,000 to 20,000 are women) was established 30-40

years ago. Ornaments made in Laljipada are even exported overseas. Along with this, there are

almost 8,000 people engaged in the plastic recycling industry, which recycles almost 94 tons of

plastic every day! Almost 17,000 people, mostly women, are employed in the making of small-

scale plastic products. There are also other small businesses such as scrap dealing, bakeries,

bottle recycling and so on (NAPM N.d.).

Activists opposing the depot allege that there was no survey conducted to determine how

many people were going to be resettled. According to activist H. M. Chandrashekhar, “the real

motive of the MMRDA [the agency responsible to implement the project] is to evict the slums in

the region and to sell the land to rich businessmen to cover the cost of the project.”106 The area

seems to command a high price as it is closer to the main arterial roads. The activists also oppose

106
This is an excerpt from a talk delivered at the “National Strategy Meet on Metrorail Projects,” organized by the
Ghar-Bachao, Ghar-Banao Andolan on 27-28 June, 2009.

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the resettlement plans and demand that the depot should not be constructed over their land. They

are well aware of the fact that earlier attempts of resettling people in high-rise apartments have

increased costs, destroyed businesses, and disrupted stable communities. The following quote

expresses the popular sentiment of the people affected by this project: “Did we build this land

with our own hands only to be given away to those who want to profit from it, while our own

lives are destroyed?” (NAPM N.d.:7).

Objections have also been raised regarding the disproportionate environmental and

monetary costs involved in the Metro Rail project compared to its actual benefits. Experts from

the Indian Institute of Technology have estimated that the 3500 million USD project would result

in the environmental costs of over 11,000 million USD. Moreover, they argue that there are

cheaper and less environmentally destructive alternatives available to solve Mumbai’s

transportation problems. According to Sudhir Badami, a noted transportation expert, Mumbai’s

current load of transport is 350,000 people per hour, an overload of almost 150-170 per cent. He

further argues that although the Metro Rail Project designed to augment city’s public

transportation system, it will only generate 72 per cent of the additional required capacity over a

span of 16-20 years. Whereas, with a total cost of 1281 million USD (much lower than the Metro

Rail) and in much less time of five years alternative transport strategies such as the Bus Rapid

Transit System and Sky Bus can generate 65 per cent more than the additional required capacity

of commuters.107

Another controversial infrastructure project that was recently carried out is the iconic

Rajiv Gandhi (Bandra-Worli) Sea Link connecting the western suburbs with the island city (see

Figure 5). The Sea Link was opened to the public on June 29, 2009 with a lot of fanfare with

107
Sudhir Badami, “Transport, Heath, Environment, and Equity in Indian cities.” Presentation at a workshop
organized by McGill University and TRIPP-IIT Delhi, December 17-19, 2007.

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displays of fireworks, light and laser show coupled with music and all the local newspapers

carried particular details marveling the massive feat of construction. For example, the bridge

weighted 670,000 tons equivalent to 50,000 African elephants; it used 23413 miles of steel wire

equivalent to the earth’s circumference; and that “Hercules,’ one of the largest water cranes in

the world had to be imported from Singapore to ensure that the bridge was completed before the

monsoons arrived.108

Figure 5. Rajiv Gandhi (Bandra-Worli) Sea Link. In recent times, this has become
Mumbai’s iconic landmark.
Source: Mumbai State Road Development Corporation Ltd.

Nearly 300 million USD were spent to construct the 2.9 mile long sea bridge with the aim

of reducing peak travel time between Bandra and Worli from 35-38 minutes to 7 minutes.

However, it was found that if one takes into account the time taken at the approach roads (due to

108
Chittaranjan Tembhekar and Ashely D’mello, “Bandra-Worli sea link opens midnight.” Times of India, June 30,
2009, p.4.

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diversions, curves, and reduced speed limits) leading to the Sea Link at both the ends the total

journey took 25 minutes, effectively saving only 10 minutes. In this context, the question raised

is whether it was worth spending close to 300 million USD to save 10 minutes of travel time.109

The more important question is whether the Sea Link was necessary in the first place and to

whom did it cater to considering the expensive toll. Further, the discussion on the Sea Link opens

up an entirely different discussion on the question of temporality and how value is attached to

time, especially of motorized elite for whom the Sea Link offered a privileged view as

highlighted by this quote: “Look out from your car window and you can see the beautiful high

rises and the sea on either side, making you feel as if you were on a cruise”110

For those who are at the helm of urban transform in Mumbai there seems to be a taken-

for-granted approach toward urban infrastructure that displaces politics of the poor. One of the

most effective rhetorical tools used to justify transformation in Mumbai is that of the reason that

privileges the notions of effectiveness and efficiency over politics and politics is seen as an

aversion, as an impediment to growth. In the area of urban governance, idea of efficiency,

finance, and pragmatism takes precedence over representativeness. The following quote, from an

interview with a senior-level bureaucrat heading the key agency that deliberates on urban

transformation in Mumbai, is instructive of the kind of change that I discussed above:

Political issues are of course important. They are more relevant in policy work. Not in project
based work. So there may not be much politics involved in whether you want to have a metro
here or monorail here or a highway going in a particular area.”111
Here the idea of politics is rendered as a deliberative process of policy making, where as

implementation is devoid of politics and it is mostly a technicality. The above bureaucrat talks

about the monorail as being non-problematic, but as discussed above the situation on the ground
109
Chittaranjan Tembhekar, “Pay Rs 50 to save 10 mins?” Times of India, June 23, 2009, p.2.
110
Rahul Khilnani, “Zip zap zoom.” Times of India, June 30, 2009, p.9.
111
U. P. S. Madan, personal interview, December 11, 2009.

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is very different where there is widespread displacement which is contested by the poor. Further,

the process of building political consensus is reduced to financial viability and efficiency. The

same bureaucrat explains:

Political will is also developed if the rest of the logistics in place like finance etc. In a democratic
set up political will is important too, but if you have adequate funds at your command, it may take
less time to get the will implemented. I mean if you have money in your pocket and if you want
to buy something, the will is there or otherwise you may think twice. Something else may take
priority over what you want to do.”112
Slum redevelopment

There exists in Mumbai a hierarchical nature of housing options available to its citizens that

range from pavement dwellings, zopadpattis (informal squatter settlements), chawls (factory-

owned low-income rental tenements), owned or rented flats, and expensive flats or apartments

owned by the rich and the super rich (Appadurai 2000; Risbud 2003). According to some

sources, about 50 per cent of Mumbai’s 12 million citizens live in slums or zopadpattyas or other

inferior form of housing (10 per cent are said to pavement dwellers). However, slum dwellers

occupy only about 8 per cent of city space, which is around 43,000 hectares.113

The answer to why there are so many people living in slums in Mumbai partly lies in the

absence of legal housing for the poor. The supply of formal housing has been far below the need.

The annual deficit of housing kept on increasing from the mid-50s until early 1990s (see table 9).

Further, considering the cost of formal housing, it is affordable only to the top 6.25 per cent of

households in Mumbai. Moreover, the private housing sector does not cater to the poor and as a

result 53 per cent of the poor or almost 45,000 households have to rely on informal housing.

Maharashtra Housing and Development Authority (MHADA) established in 1977 to provide

housing to low and middle income groups in Maharashtra has constructed 33,890 units for the

112
Ibid.
113
Figures cited in Appadurai (2000:646).

144
economically weaker sections and 19,184 units under the slum clearance scheme in the state.

However, since its inception until 1995, MHADA did not construct a single unit for the

economically weaker sections in Mumbai. Frequently cited reasons for non-construction of

adequate houses in Mumbai have been lack of availability of funds and space (Indian People’s

Tribunal 2005).

Table 9. Ratio of Average Annual Supply of Housing in Metropolitan Mumbai

Period
Annual Need Total Supply Deficit
1956-66 46,000 17,572 28,428
1973-82 60,000 19,626 40,374
1984-91 85,000 47,417 37,583
Source: Indian People’s Tribunal (2005:50)

The current slum development policy in Mumbai is a variant of its earlier Slum

Redevelopment (SRD) announced in 1991. As early as 1980s, it was suggested to the state

government that private participation in slum development should be encouraged. In 1991, the

state government accepted this proposal and deviated from its earlier pattern of public sector

involvement in slum redevelopment (Risbud 2003). Later, in 1995, a new scheme was introduced

called Slum Rehabilitation Scheme (SRS) based on public-private partnership. On paper, this

plan appears to be democratic based on community participation in the rehabilitation program

and seeking private builders to implement plans. However, in reality, the private builders use

their economic power to influence the resettlement plans. The “private” participation in this

process is not just limited to builders, but other non-state actors such as NGOs like Society for

the Preservation of Area Resources Centers (SPARC) have begun to play an active mediatory

role in the settlement process. This kind of network between slum dwellers, SRA, private

builders, and the intermediary NGOs has led to “institutional pluralism” in the housing delivery

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system which has often lead to conflicts between different stakeholders (Sanyal and Mukhija

2001).

The Vision Mumbai report (2003) mentions that to put Mumbai on the course of

development, the city has to free-up land by 50-70 per cent. Following this report, in 2004-2005

the state government through its battery of officials demolished 94,000 homes at 44 sites,

“freeing-up” 288.80 acres of land. This was described as “Operation Shanghai” in the daily

newspapers (Mahadevia and Narayan 2005:16). This incessant drive to free-up land

“encroached” by illegal slums has introduced new legalities, technologies, and agencies to

dissuade development of slums. It ranges from issuing photo-cards for slum dwellers to

controlling urban space with cameras and “flying squads.” The Citizens Action Group (CAG),

univocally endorsed these violent demolitions (Mahadevia 2008b).

Table 10. Slum Demolitions in Mumbai

Year of Demolition Number of Slum Households Demolished
1994 55,784
1995 62,385
1996 84,681
1997 108,322
1998 49,154
2004-2005 94,000
Total 454,326
Source: Singh (N.d.)

One of the most important slum redevelopment project in Mumbai today is the

development of 360 acres of Dharavi—Asia’s largest slum, which has also been proposed in the

GOM Report (2004). Because of its proximity to the emerging business center at Bandra-Kurla

Complex and its easy access to the airport, this is one of the most sought after pieces of real

estate in Mumbai. Recently, the Dharavi redevelopment has attracted big national and

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international real estate companies from the US, Kuwait, Hong Kong and Dubai.114 However, the

project is mired in controversy and there is a strong opposition against it from certain local

communities.

Mill redevelopment

With the growth of the textile industry in Bombay since the mid-nineteenth century there

developed a unique textile mill district called Girangaon, “village of mills,” in the central parts

of the city (Chandavarkar 1994). This area includes the mills as well the chawls or rented low-

income tenements owned by the mill-owners. However, immediately after the textile strike in

1982-83 most mills were shut-down, retrenching more than 100,000 workers. Today there are 58

functional mills—33 privately owned, one owned by the state government, and 25 managed by

the central government. Due to rise in the real estate prices from late 1980s to early 1990s, the

“vacant” Mill lands came to be viewed as the most valued land for redevelopment. The

combined value of the 600 acres of the Mill lands in the 1990s was estimated to be around Rs 50

billion (Paul, Shetty, and Krishnan 2005: 399). The Development Control (DC) Rules of 1991

that deal with Mill lands were amended to enable the sale or modernization of Mill lands. As per

the new rules some of the excess Mill lands could be redeveloped and a part of the profits

accrued from the redevelopment was to be invested in the revival of the mill and a part was to be

used to generate employment for the workers. Those parts of the Mills that were unviable for

development were to be distributed in three parts: one third for low-income housing, one-third

civic amenities, and one third for development by the mill-owner. In practice, however, the mill

owners have managed to exploit certain loopholes in the law to redevelop or sell the Mill land

(Lokshahi Hakk Sanghatana Report 1996). Some of the mills have been converted to up-scale

malls such as the Phoenix Mall in Lower Parel. This transformation from Mills to Malls in very
114
See “Dharavi redevelopment: Five foreign players throw hat in the ring.” Times of India. June 28, 2007.

147
poignantly described in one of the studies on the Phoenix Mill as shown by the quote following

the photograph below:

Figure 6. High Street Phoenix Mall. This mall was actually a former textile mill. The
owners consciously chose to preserve certain parts of the mill (see the tower) to
accentuate its historical past. This mall has been consistently listed as one of the top
three malls in Mumbai.
Source: Thirani (2011)

When today one enters the Phoenix Mills, it has a ghost-like character — walking through the
gates in the evening, the massive buildings that form the compound with their graceful Gothic
architecture, their interiors wear a deserted appearance. Piles of wood, bricks, cement and mortar
sit in dusty piles within the various departments of the old mill, stripped of their former purpose,
their previous occupants banished, and their machinery removed to sale or scrap. At the back of
the compound, only the winding department continues to hum with productive activity, while a
stone’s throw away the Fire and Ice Disco thumps with dance music. The chimney of the mill
towers above disco, awaiting the day when, in a gesture of cynical irony, the owners of the
Bowling Company propose to repaint it to look like a bowling pin. Amidst the rubble and dust of
the deserted premises of the spinning and weaving sections of the mill, where only a year ago
cloth was being processed and sent to market, Marutis [a popular Indian car] and Mercedes are

148
 parked, and the buzz of mobile phones is heard. Industrial activity has given way to leisure and
entertainment, though this change appears like a forcible occupation by an invading army, who
care little for the legal and democratic rights of the people they have displaced. Indeed if they
even know of them, which they probably don’t (Krishnan 2000:9).
Along with the DC Rules, Mill land sale was also subject to guidelines of Urban Land Ceiling

and Regulation Act (ULCRA) which set limits on the development of surplus Mill land.

However, in 2011, this legislation was scrapped in Maharashtra due to a sustained campaign

from developers who argued that it would free up 25,000 hectares of land which could attract

foreign investors. The scrapping of ULCRA is bound to lead to increasing speculation in the real

estate market in Mumbai. A recent article highlights that Mumbai has become the “world’s

second-most expensive market for office space after London’s West End and the third-fastest

growing such market…rentals in places like Nariman Point, a business district in south Mumbai,

have jumped 55 percent from a year earlier to 189.51 USD per square foot a year.”115

The dislocations caused by the elitist visions and practices of transformation in Mumbai

has led to widespread discontent within the poor and laboring classes and sections of them have

organized to resist these changes. Interestingly, the new context of redevelopment has also

emboldened support for conservative forces in the city to rekindle nativistic assertions. In the

next chapter, I describe some of these contestations and the alternative visions of urban

development they generate.

115
Krittivas Mukherjee and Devidutta Tripathy. 2007. Maharashtra scraps land law, property prices rise. November
29. Reuters, India. Retrieved on March 9, 2011 (http://in.reuters.com/article/2007/11/29/idINIndia-
30749620071129).

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 CHAPTER 6

WHOSE CITY IS IT? MUMBAI: A CONTESTED CITY

~In understanding Mumbai’s transformation, it is important to focus on questions such as the

increasing privatization of health and education. However, the most important question today is—
Whose Mumbai is it? Does Mumbai belong to the workers and the middle classes who built this
city, or does it belong to the capitalists, builders, Mafia, and the politicians who serve their
interests?116

~We should all be aware in our hearts and minds: Where is our share? What is our place in this
city of Mumbai which is sustained by our efforts? What is our “right to this city” which is built
on our labor? Is this question on everybody’s mind?117

~This is a people’s movement for inclusive growth and that is all they are fighting for (Medha
Patkar).118

The ideological and contested nature of urbanism is becoming a key issue in the South as

policies gravitate toward maintaining high-growth. Globally inspired restructuring projects are

always contextually embedded within “inherited institutional frameworks, policy regimes,

regulatory practices, and political struggles” (Brenner and Theodore 2002:350). Therefore, there

is always a disjuncture between the ideology of (neoliberal) growth and its everyday functioning

and influence as the process of incorporation of global forces is a contested one, generating

possibilities of alternative claim-making and citizenship (Sassen 2000b).

In the urban context, Castells’ (1983) argues that urban social movements arise as a result

of “urban contradictions” related to production, distribution, and management of collective

consumption of goods and services. Such urban contradictions marginalize the urban poor who
116
Translated from Mumbai te Shanghai (Mumbai to Shanghai). N.d. Girni Kamgar Sangharsh Samiti, Mumbai, p.3.
117
Excerpt from Medha Patkar’s speech from the film Road to Shanghai (Via Mumbai). Retrieved on May 26, 2011
(http://www.cultureunplugged.com/documentary/watch-online/festival/play/4469/Road-to-Shanghai--Via-Mumbai).
118
Yogesh Pawar, “Adulation has not come easy.” DNA, October 25, 2010. Retrieved May 26, 2011
(http://www.dnaindia.com/mumbai/report_adulation-has-not-come-easy-for-medha-patkar_1457498).

150
are often the targets of urban policies. Urban contradictions enable new or renewed forms of

contestations, exerting considerable constraints on the state power. Therefore, the production of

space is not a result of a unilateral impact of global economic forces on the urban environment,

but is a contested and negotiated process in which social movements subvert or challenge the

hegemonic processes. In the context of inclusive growth, the state has to maintain a fine balance

between facilitating rapid growth and meeting the demands of the urban poor affected by various

urban redevelopment projects.

I have described Mumbai’s growth contradictions elsewhere using the term “globalizing

marginality” (Ghadge 2010). By this I refer to the Janus-faced nature of urbanism, whereby, “on

the one hand, the globalizing impulse of the new world economy has subjected the city to new

strategies of urban development and regulations; while on the other hand, this very process of

globalizing caters exclusively to certain key economic sectors and elites, marginalizing most of

the population” (Ghadge 2010:72). Emerging urban growth strategies have engendered a new

form of politics. These urban conflicts are not confined to the state alone. The marginalizing

nature of urbanism in Mumbai has also led to contestations within the civil society between the

urban poor and the middle classes. In the remaining part of this chapter, I first discuss three

emerging contestations of the urban poor based on three poor peoples’ movements in Mumbai

that I have studied involving the slum dwellers, street vendors, and former industrial workers

who are impacted by various restructuring projects in the city. Later, I also engage with other

forms of contestations in the city that may not necessarily emerge out of the neoliberal growth

strategies, but nonetheless generate alternative claims of representation and citizenship in the city

are in apparent contradiction of the Shanghaization strategy.

151
 For the sake of clarity and comparison, I summarize in Table 10 the three forms of

contestations (that I subsequently discuss) based on Tilly’s model of social movements that

involves three essential elements: campaigns, repertoire, and WUNC displays (worthiness, unity,

numbers, and commitment).119

Table 11. Poor People’s Movements in Mumbai

Actors/Movements Campaigns Repertoire WUNC Displays
NAPM/GBGB -Claims: housing, Direct action W: honest, hard-
Andolan alternative working production
development Rallies citizens
-Claimants: slum
dwellers Demonstrations U: Revolutionary
-Objects of Claims: songs, poem,
builders, politicians, Coalitions building speeches
state
-Public: urban poor, Filing court cases C: Resisting
migrants, urban repression,
middle classes Right to information ostentatious sacrifice
Girni Kamgaar -Claims: housing, Rallies W: “builders of the
Sangharsh Samiti space, identity city;” working class
-Claimants: former Petitions pride
textile mill workers
-Object of claims: Filing court cases U: common working
government, textile class history
mill owners Coalition building
-Public: working class C: long drawn
people, urban poor struggles
Street Vendors’ -Claims: right to Petitioning W: provide basic
Organizations space and livelihoods, services, hard work
regularization Filing court cases
-Claimants: urban U: preserving
poor, informal Lobbying with livelihoods
workers national-level
-Object of claims: organizations C: clean food and
government, middle- space
class civic groups Transnational
-Public: urban poor, linkages
working classes

119
According to Tilly (2004), campaigns are organized, sustained, collective claims involving three parties: the
group of claimants, objects of claims, and a public of some kind; social movement repertoire are the forms of
political action employed by participants; and WUNC displays are public representations of the participants that
important in conveying various political messages to the public.

152
Politics of the Urban Poor

The rights-based struggle for housing in Mumbai

Immediately after the publication of the Vision Mumbai report, between November 2004 and

March 2005 (in what is referred as “Operation Shanghai” in the local newspapers), 90,000 homes

of slum dwellers were demolished at 44 sites across the city and an estimated 450,000 slum

dwellers were evicted, “freeing-up” 288.8 acres of land (IPT 2005; Mahadevia and Narayan

2005). The nature of evictions was so brutal that it invited terms such as the “Indian Tsunami”

and in the first 18 days itself around 39,000 homes were demolished (IPT 2005; Roy 2009a).

One of the officers in-charge of the demolitions was even quoted as that it was time to turn

Mumbai into the “next Shanghai” and for that to happen “we want to put the fear of the

consequences of migration into these people. We have to restrain them from coming to Mumbai”

(Biswas 2005). According to a survey conducted by the NGO YUVA (Youth for Voluntary

Action and Unity), almost 9.63 billion USD were spent on carrying out these demolitions. In the

28 slums surveyed by YUVA there were 375 police and municipal vans, 2996 police personnel

and 87 bulldozers were utilized for the demolitions (Indian People’s Tribunal 2005:28).

One of the residents of Ambujwadi, which was one of the first settlements that was demolished

(see Figure 4), expresses the unprecedented brutality of these demolitions in the following

manner:

This demolition is almost like the end. Everything is in complete chaos. In my presence, there
has been demolition 5-6 times. But there is no precedence to this demolition. Earlier despite
demolition, we managed to stay, but this time we are not even allowed to stay after demolition. If
we request to stay, we are tortured…Not a single house is left. (IPT 2004)
The demolitions propelled the emergence of a housing rights movement in the city. In the

aftermath of the demolitions, the slum dwellers came together under a coalition called

Zopadpatti Bachao Samyukta Kruti Samiti or Joint Action Committee to Save the Slum

153
Dwellers, under the leadership of noted activist Medha Patkar of the NAPM (Weinstein and Ren

2009; Mahadevia and Narayan 2005). The struggle later assumed a new name in the Mumbai

context called Ghar Bachao Ghar Banao Andolan [GBGB] (Movement to Save and Build

Homes).).120

Figure 7. Ambujwadi Slum in Malad, Mumbai. Consisting of about 1600 homes, it was
one of the first sites that were demolished during the 2004-2005 demolitions in
Mumbai. However, its residents organized to reclaim the area a few months later.
Source: Author (2009).
It is argued that this was the first time that “hitherto ‘private’ and individual struggles of [poor]

citizens entered the public domain” when evictees in different parts of the city joined hands in

demanding security of tenure (Bhide 2009). At the time of the demolitions Medha Patkar was

120
The National Alliance of People’s Movements (NAPM) is an alliance of over two hundred people’s
organizations and movements in India which began in 1992. The NAPM describes itself as “an alliance of
progressive people’s organizations and movements, who while retaining their autonomous identities, are working
together to bring the struggle for primacy of rights of communities over natural resources, conservation and
governance, decentralized democratic development and towards a just, sustainable and egalitarian society in the true
spirit of globalism.” For more information, visit their website (http://napm-india.org/). In the following sections, I
will mention the NAPM if I am referring to the broader national level movement and NAPM/GBGB when referring
to its Mumbai specific activities.

154
busy attending to Tsunami victims in South of India. However, the enormity of the

displacements propelled her to move to Mumbai and join the struggle. In mid-December 2004,

there was a large rally held at the Azad Maidan which was attended by thousands of people.

Bolstered by this there were street demonstrations in February 2005 and following this the

protestors also demonstrated in front of state government headquarters. Their immediate demand

to the Congress party led state government was to put a halt to the demolitions and to live up to

their election promise of regularizing all slum residents who could prove that they lived in the

region before 2000. Simultaneously, they also tried to resist evictions and also reclaimed some of

the evicted spaces and started to rebuild their houses. Pressured by the national leadership of

Congress, the state government finally put a halt to the demolitions in February 2005.

Figure 8. An NAPM rally on the eve of International Women’s Day

Source: Author (2009).

155
 It has been argued that this new social movement in Mumbai characterized by

NAPM/GBGB departed radically from the “populist mediation” strategies of prominent

“government-friendly” network of organizations that include the Society for the Promotion of

Area Resources (SPARC), the National Slum Dwellers Federation (NSDF), and Mahila Milan, a

network of women’s groups (Roy 2009a:161). Roy (2009) refers to this process of mediation

between the government and various social movements and the representatives of the urban poor

as “civic governmentality” which produces “governable spaces and governable subjects”

(ibid:163). As a result of their proximity with the state apparatus these organizations, along with

other NGOs, are viewed with suspicion by poor peoples’ movements such as NAPM.

Organizations such as the SPARC avoid a confrontational positioning vis-à-vis the state and

insisting more on collaboration. Because of this organizations such as SPARC are unable to vest

control of urban planning and development from the state (McFarlane 2004). Sections of the

urban poor, therefore, are becoming critical of this dialogue-based politics of SPARC that may

have proved successful to resettling people, but have limited impact on issues of livelihood.

More often than not the resettlement sites are away from places where these poor people work

(Roy 2009a:172-3). This “politics of compensation” according to Roy (2009:173), “produces an

entrepreneurial subjectivity…a subjectivity steeped in the morality of collaboration, participation

and mediation. To protest, to confront, is to stand outside the parameters of citizenship.”

This NAPM/GBGB rejected this strategy of “negotiated development” and framed

Shanghaization of Mumbai primarily as an issue of right—of the urban and rural poor’s “right

over urban space” (Patkar and Athialy 2005). This approach of politics challenges SPARC’s

“institutionalized inclusion” through an assertive “right to the city” (Roy 2009a:176). An

156
interview with an NAPM/GBGB activist illustrates this new rights-based approach to housing in

Mumbai:

But today if your are living here and if this basti exists then I have the right to live here…..[A]s
per the Human Rights Commission, everybody has the right to earn their food, clothes, and home
anywhere in this country. We are the citizens of this country. We work in this city, earn a
respectable living, we work hard and you get your jobs and salaries from the taxes we pay. So
you have to grant us our rights.121

Figure 9. Medha Patkar addressing a NAPM rally.

Source: Author (2009).
Translation of the posters: Top left-“Our struggle is against violence and exploitation”
Top center: “What is the labor of the poor? What is their right?
See for yourself”
Top right: “Save Homes, Build Home”
Middle: “Mumbai is not the property of builders. It is ours”

121
Personal interview, June 19, 2009.

157
This rights-based approach to housing is predicated not only in terms of constitutional rights, but

also on a sense of fairness that emerges from the contribution of the poor to the city’s elite and

the economy. The same respondent highlights:

Mumbai is not such a good place to live and you are dreaming of transforming it into Shanghai.
But the ones who made Mumbai, who build it, are living lives worse than dogs. In this slum, there
is one carpenter, there is this person who makes auto body parts, there is a driver, and they
provide service to us. If there is no carpenter we would not have furniture, if he was not there the
houses would not be built. If there is no driver your vehicles won’t run. Without the mechanic,
the vehicle would not be repaired. And these people lead a life of slavery. Those who make
Mumbai run, themselves cannot even walk well and they want to make a Shanghai out of it?122
This assertive approach also often leads to a more confrontational position vis-à-vis the state and

mistrust for the electoral process, which is viewed as a means of cooptation, although the NAPM

does organize public hearings before elections to educate and encourage slum dwellers to vote. A

part of this mistrust for the electoral process stems from the realization of inadequacy of electoral

politics to bring about any structural transformation. Medha Patkar lays out NAPM’s broader

vision of alternative politics in an interview in a recent talk show in which she states:

What is politics? Is it only electoral politics? The sphere of electoral politics is too limited.
Politics means changing the relations between the state and society and bringing about a desired
transformation. It is about resolving the conflict between the state and its people. And that is
what we are doing. Real politics is going beyond the limited politics of votes and notes. It does
not mean that people from the movement should not enter electoral politics, but there is a need to
empower the politics engendered by the peoples’ movements which is a kind of alternative
politics.123
However, there were some dissident voices regarding the notion of politics that emerged when I

interview some other activists associated with the movement. Some of these activists contested

the 2009 Maharashtra state assembly elections as independent candidates. These activists were

122
Ibid.
123
Khupte tithe Gupte, Episode telecast on March 11, 2011 Episode, Available at
(http://www.youtube.com/watch?v=kHrwI8U6aIk).

158
particularly critical of the movement’s stance toward electoral politics. One such activist who

had lost the elections was particularly vocal about the futility of movements in influencing

government’s decisions from being outside of the establishment. According to him, unless there

was a visible “political threat” to the entrenched political candidates nothing was going to

change. In this regard, he was very critical of the manner in which electoral candidates were

supported by the movement. In his interview he mentioned to me that independent candidates

like him who have been part of the movement did not stand any chance to win when voting in

slums is encouraged on party-lines, guided with the sole objective of keeping communal parties

such as the BJP out of power. He vents out his frustration in the following manner:

They ask you to vote for the same candidates who tore down your house. Then why would
anyone listen to you? For five years you struggle for you houses and at the end of five years you
ask people to vote for the same people…It does not matter who wins or loses. But at least don’t
snatch away the right to vote of the person who has lost his home. Let the person vote as he/she
pleases. If you keep voting for the same party and people, they know these people are helpless
and no matter they will vote for us. You do not have a conscience.124
This issue of elections also came up in NAPM’s 7th Biennial Convention at Kushinagar, Uttar

Pradesh in 2008. In one of the sessions on “alternative politics” a central issue that was raised

was “whether [NAPM’s] struggle is sufficient to create an alternative politics or an alternative

social system” or if there was a need for any efforts. In this regard, the issue contesting for

elections was raised. The key debate was whether contesting for elections enlarged the influence

of the movement or did it reduce its effectiveness. On the one hand, people argued for a value-

based politics and opined that the Alliance had no role in the corrupt political process. Further, it

was also observed that mainstream politics has proved to be incapable of solving the problems of

the masses therefore, there was a need for people’s movements. On the other hand, some felt that

124
Personal interview, November 25, 2009.

159
the political revolution was part of the social revolution and that a part of the Alliance must

accept the challenge of electoral politics and built constituencies, while the other should continue

their struggle for a social revolution.125

On the social front, the movement is routinely involved in implementing programs

administered under several government social service schemes such as jeevan shalas (life

schools), anganwadis (courtyard shelters) and balwadis (play schools). It has also engaged in the

self-provisioning of housing and livelihoods through the Ghar Bachao, Ghar Banao Andolan

(Movement to Save and Build Homes).

The activists of the NAPM/GBGB have displayed several repertoires of protest such as,

political lobbying, public interest litigations, demanding information under the right to

information act (RTI), street rallies, demonstrations, and direct non-violent action. The activists

of the NAPM are careful to differentiate themselves from the “new” social movements of the

1960s (they use the term “poor peoples’ movement”) and the “NGO politics,” which they find to

be corrupt and co-opted by the state and market forces. Some of the key discourses of the

NAPM/GBGB revolve around the notions of “illegality,” “encroachment,” “ghettoization”

(displacement and relocation of the urban poor outside the city through what one activist referred

to as “manufacturing slums”), and “elite cosmopolitanism.” In its critique of the popular terms

such as the above which are routinely used against the poor, the movement cleverly employs a

strategy of what I like to call a “strategy of discursive inversion,” whereby activists counter these

labels by inverting their meaning in the context of the elite subversive (illegal and encroaching)

activities of the rich. A quote by an activist in relation to “encroachment” by the elites in the city

will illustrate this strategy:

125
NAPM, 7th Biennial Convention of NAPM: A Report, Mumbai, 2008.

160
 Take the case of Hiranandani (one of the city’s richest builders). He bought the land for 40 rupees
an acre and is also obligated to provide low-income housing to people…In Mumbai Central there
is a 60 floor building being constructed encroaching on a public road. How can that [building] be
constructed on the roads? Why does the road always go through poor peoples’ houses?126

Figure 10. The Atria Millennium Mall in Worli, Mumbai. It is alleged that the land
for on which this mall is built was actually allocated for a low-income housing
project, however the builder blatantly disregarding planning regulations built a
high-class mall that now houses showrooms of Swarowski, Rolls Royce, and BMW
and also a 4-D cinema theater and entertainment plaza.
Source: Author (2009).

However, to counter the popular meaning such as “encroachment” requires hard work. First,

activists have to excavate strategic government information through the Right to Information Act

(RTI) on irregularities or encroachments by the government and the rich on various issues such

126
Simpreet Singh, NAPM activist. Personal interview, July 4, 2008

161
land availability, resource utilization, and illegal land deals. Second, this information then has to

be disseminated through relatively scarce pro-poor print media or through pamphlets during

rallies and protests. The strategic information is often used to highlight the criminal nexus

between the builders, politicians, and bureaucrats in the land and housing market in Mumbai.

This strategy was most successfully used in a recent campaign to make visible the irregularities

in a housing project that was meant for war veterans. In what is now famously referred to as

“Adarsh housing scam,” the activists of NAPM/GBGB collected information through the RTI

and found that houses were illegally allocated to bureaucrats and politicians. This high profile

scandal eventually cost the then Chief Minister his job as he was made to resign in 2011 in

opposition to strong public opinion. More recently, the NAPM/GBGB has also been involved in

a struggle against demolition and redevelopment of a slum close to the new business district in

the central part of the city. The activists alleged that the government favored a builder who had

used fraudulent means to show approval of slum dwellers to redevelop the slums. In June 2011,

Medha Patkar went on an indefinite fast after the court ruled in favor of the builder. The slum

dwellers also have filed a criminal case against the builder, which is still pending.

Earlier, in 2009 the NAPM/GBGB activists had uncovered another scam allegedly

committed by one of the most prominent builders in the city, Hiranandanis, who are also part of

the regular stake-holders that are consulted in Mumbai’s urban affairs. Activists of

NAPM/GBGB found that the Hiranandani had committed a fraud of more than 30,000 crore

rupees (about 5 billion USD as per the current exchange rate) in the Powai Area Development

Scheme. One the one hand when poor people were being evicted at various parts of the city, rich

builders such as Hiranandani were given 300 acres of land at the rate of 40 paisa acre in the

Hiranandani Gardens scheme. The original motive was to build houses for low and middle

162
income people, but in blatant violation of rules, the builder built luxurious apartments for the rich

which were sold at about Rs. 4 crores each (about 600,000 USD). Following this expose, the

builder was instructed by the Mumbai High Court in 2012 ordered Hiranandanis to stop any

future sale of apartments and to construct 3,000 apartments for low and medium income people

at the 1985 rate. In this context, an activist noted “millions of working class people have a right

to decent housing and it is time state government started evicting the big builders who have

encroached upon the public and other land meant for housing of urban poor.”127

Although these struggles for housing the poor are closely tied to the issue of urban space,

they resonate far beyond it. Activists on the ground recognize this fact and understand the

housing struggle as a part of a wider process of urban transformation in India that involves

displacement from rural areas. When asked in an interview about what is wrong with

Shanghaization, Medha Patkar diagnoses the problem in the following manner:

The overall objective of our policies is to change the rural areas into towns and even
cities….With the claim of bringing them into the mainstream, turning them urban, their resources
are being used through the development projects for the increasing desire of the urban areas, and
not for the benefit of rural population. No one is taking care to strengthen the rural economy by
ensuring that the rural poor get their minimum or optimum where they are. Rather, after coming
to cities, their services are exploited to change the face of the urban locale. Later, they are
considered to be a burden on the city and are ruthlessly shooed off. It is very peculiar that the
people, who use the services of these poor, are unable to bear their sight on their way to work or
shopping (Patkar and Athialy 2005).
Even in my interview with activists, I found a similar critique of the dominant development

paradigm. One of the activists expressed the following in an interview:

If development is evacuating villages and make people run away from their land then how will
we agree on such development? Does development mean deserting people from their own
homes? If this is development, then we refuse to accept it. If our homes are dismantled, if we are

127
Simpreet Singh, personal interview, December 16, 2009.

163
 made homeless, then how can it be development? We consider development as that which
understands our needs. If you want to do anything on our land then first make arrangements for
us. However, you cannot make arrangements anywhere you please, where there are no facilities.
You should not send us to places where there is no bus service, or school, or a place to play or no
proper access road. Send us to a place where there are facilities give us a key of that home and
tell us that this is your home then we would certainly leave our place. We need basic minimum
services.128
This assertive stance is also evident in manner in which security of tenure is understood by the

poor and how it differs from a legal, state-centric definition of tenure. The state understanding of

tenure is essentially tied to land and is defined as a series of rights related to citizenship, property

rights, and access to services. But the poor understand tenure as a part of an overall “right to the

city” that includes access to essential services such as food, water, shelter, work, education,

sanitation, and health (Bhide 2009). Therefore, in the above quote the activist is not merely

demanding a relocation, but relocation to a place that gives him access to various basic services.

A long time housing activist in Mumbai, P. K. Das, too sees the question of housing in

the city as part of the larger movement for democratic rights. In this sense it ceases to be merely

an issue of physical space, in terms of an actual house or space but represents larger issues of

political, civil, and human rights. Therefore, according to him, these are primarily struggles of

“recognition” that have to do with human rights and dignity of the urban poor and about

recognizing their capacity and capabilities. Therefore, housing struggles should go beyond

opposing and stopping evictions or the “right to stay,” but should engage with larger issues of

urban transformation in the city of challenging the market-led development policy related to

land-use, development planning, and infrastructure planning. In this context Das is critical of the

leadership of emerging social movements in providing specific alternatives. Das argues that:

128
Personal interview, June 19, 2009.

164
 The leadership is becoming like the mainstream political leaderships, which is generalizing
everything, which is speaking generally about everything. They may be forceful, they may be
effective, they may even be popular, but beyond this point they do not have alternatives. A
movement cannot last for long or grow if it is only rooted in generalization. In order to provide
alternative, it [a social movement] has to deepen its knowledge and its capabilities in areas of
health, education, housing, science and technology and in other spheres of life. Because this is not
happening social movements do not induce professionals.129

Right to work: From Shrampur (city of labor) to Singapore

As discussed earlier, the formation of textile mills in Bombay led to the emergence of a unique

working class culture in Bombay within the mill district that came to be known as Girangaon.

However, with the decline of the textile mill industry, accelerated by the 1982-83 strike vast

tracts of “vacant” mill lands are now the locus of contemporary urban redevelopment. Although,

most of these mills have been closed by the mill owners, their “vacant” premises still house

many mill worker families who were provided housing on the mill premises. These families, who

have now joined the ranks of the new urban poor since losing work, are now struggling to find

alternative means of livelihood and housing. But more importantly, they are waging a losing

battle to preserve their unique working class culture in the city which no longer needs them.

Praveen Ghag, Secretary of the GKSS, explained to me the significance of this city-

within-a-city called Girangaon in a personal interview:

Do not think that this is an exaggeration, but there was a time when people used to know time
when they used to hear a siren of the mill. They used to blow a siren early in the morning at 7 am
when the mill opened and when people went to work, then again at 12 pm in the afternoon for
lunch, and later when the workers went home from work in the evening. This is the way
Girangoan scheduled its day. In that same Girangaon, about 250,000 people were employed in the
mills. Apart from work, they also had a place to live in the chawls. They also had municipal
schools like Shirodkar and Balmohan where they would send their children. They also had access

129
Personal interview, December 16, 2009.

165
 to health services due to government hospitals such as KEM. The point that I am trying to make
is Girangaon was not only a place of work, but it was city in itself that catered to all your
existential needs from work, to education, to health. It was a place where everybody from the
poor to the rich lived. Even in terms of entertainment, there were cinema theatres like the
Bharatmata and Plaza where one could watch a Marathi movie for two or three rupees. There was
also the Hanuman Theater where people could watch a tamasha...130

Figure 11. Rehearsing for the Ganesh festival in Girangaon, the mill-district of
Mumbai.
Source: Author (2009).

130
Personal interview, December 18, 2009.

166
 Figure 12. Masala Galli (Spice Alley) in Girangaon
Source: Author (2009).

Several NGOs, civic groups, and trade unions are struggling to preserve the mill lands for

the textile workers and their families. Most prominent among them is the Girni Kamgar

Sangharsh Samiti (GKSS) or The Textile Workers Struggle Committee. The Band (closed) Girni

Kamgar Sangharsh Samiti (BGKSS), which later became the GKSS, was formed in 1989 to

resist the “lock-outs” of the mills by the mill-owners after the 1982-83 strike. In a span of two

years during 1987-89, six mills were closed down by the mill-owners, displacing almost 20,000

workers. These events led to workers coming together to organize, putting into action their

historic organizing skills that were nurtured through years of militant trade union struggles.

Meetings were held at the gates of closed mills to encourage workers to organize, however there

167
was not much support from the labor unions which had been demoralized after the failure of the

1982-83 strike (Iswalkar 2009:4). The BGKSS organized a national convention of textile

workers facing similar issues across India. Some of the demands outlined were: nationalization

of mills, a put a stop to the modernization of mills, to avoid worker retrenchment, and an

unemployment benefit for the unemployed workers. Letters were sent out to various ministers in

the government. However, there was no response from them. It was then decided to disrupt the

state legislative assembly meeting in Mumbai. In order to do that, activists stopped members of

the assembly from going to the meeting by locking them indoors in their temporary government

accommodation. This garnered enough attention for their grievance to be taken up for discussion

in the assembly. This was followed with indefinite fasts by activists to protest against the DC

Rules of 1991.131 A one-day “bandh” (shutdown) was observed by shop-owners in Girangaon in

solidarity with the fasting workers. Finally, on the ninth day, a delegation of government met the

fasting workers and gave reassurances on the question of restarting the mills. However, despite

workers’ resistance the government decided to side with the mill-owners in allowing the sale of

the mill-lands under DC Rules 1991.

Praveen Ghag in his interview explains how the DC rules were a clever maneuver of the

state and mill-owner nexus to ultimately close down the mill due to the huge profits in

redevelopment of mills:

After the 1982-83 strike 100,000 workers did not go back to work. And with the remaining
workers who went to work in the mills, these mill owners were not interested in running these
mills. The mill owners were looking for a way out to sell these mill lands in order to make a lot of
money by redeveloping them....therefore in 1991-92 the Sharad Pawar government came out with
the Development Control rules... This was an act developed by the government in favour of the
mill owners. Initially it was decided that and the surplus land of the mills would be sold by the

131
See the earlier discussion on the DC rules on page 150 in the context of mill redevelopment.

168
 mill owner and that money was to be used for the modernization of the mill. People were told that
this act was formulated to ensure that the mills kept running. But after formulating the act the mill
owners sold the land, but the money earned from the sales were not reinvested in the
modernization of the mills.132
From 1991 onwards, the incidents of mill closure increased and the mill-owners used various

tactics to close down the mills. The mill owners systematically cut the power and electricity

connections in the mills, workers were made to sit without any work, various mill departments

were closed down and thereby, created this belief that these mills were not going to work. At the

same time the owners offered the workers the carrot of the Voluntary Retirement Scheme (VRS).

Therefore the workers had no other choice but to accept it as when they had earlier approached

the courts for non-payment of salaries, the court did not rule in their favor.133

In 2001, there were further amendments made to the DC Rules of 1991 which allowed

the mill-owners to give even less land for low-income housing than the earlier legislation. In

February 2005, a Public Interest Litigation (PIL) was filed in the Mumbai High Court

challenging the legality of the 2001 amendment. On April 1, 2005 the court stayed the

redevelopment of the mill land. However, on April 20, 2005 mill-owners filed an appeal against

the High Court verdict in the Supreme Court after which the Supreme Court granted permission

to seven centrally-owned and five privately-owned mills to go ahead with the redevelopment

plans. Following this, two centrally-owned mills and two private mills were sold in June-July

2005. The sale of one of the centrally-owned mills was challenged by another PIL in the Mumbai

High Court in August 2005. However, the Supreme in a later judgment upheld the sale of mill-

land, clearing the way for redevelopment and sale of other mill-lands in Mumbai.

132
Personal interview, December 18, 2009.
133
Ibid.

169
 In 1994, a “Save Girangaon Campaign” was launched which explicitly aimed at

preserving the working class culture of Girangaon by arresting the “mills to malls”

transformation that was currently underway (see Figure 13). During the campaign city’s several

noted theater and film personalities and poets lent their support to the workers. A famous poet

Narayan Surve presented a lavni (a regional art form that includes dancing and singing) that

sarcastically portrayed how the city was been transformed from Shrampur (city of labor) to

Singapore (Iswalkar 2009:36).

Figure 13. One of the several mills in the mill-district of Girangaon that is been
redeveloped into new offices or residences.
Source: Author (2009).

Praveen Ghag in his interview explained to me how this “mills-to-malls” redevelopment

is proving to be detrimental to the city. Citing the example of Phoenix Mill (see Figure 6 on

p.147), he argues that this had proved to be a bad precedent as the malls have led to severe

170
congestion around the area as the motorized elite come to entertain themselves in these places.

He further explains that the IT industry that came after the closure of mills cannot absorb the

workers who had lost their jobs as seventy per cent of them were in the age-range of 40-50 and

did not possess the skills required for these new jobs. In addition to not having a good chance at

getting reemployed, the workers were running out of their VRS savings. In this situation the

former textile workers got systematically marginalized in the city. Some sold their rooms and

tenements in order to start a new business, however, many suffered losses. Therefore, they had

no other choice but to leave the city and return to their villages or move to the suburbs where the

cost of living was cheaper. Even those who returned to their village found themselves in a

strange setting as because their families had moved to the city more than hundred years ago, they

have no knowledge of farming. However, even today the workers who migrated from Western

Maharashtra and Konkan and how were given tenements in the malls still continue to live in the

mill premises. There about 6000 people living across 17 mills. But according to the rules they

had no legal claim over these tenements as the mills were closed. However, they had nowhere

else to go.134

With the decreased allotment of land for worker’s housing only 25 acres were now

available than the earlier 100 acres. However, with further pressure from the workers’

organizations the government decided to increase the FSI of these buildings to 4. As a result of

this around 60-65,000 houses will be constructed. Further, the workers’ organizations have also

managed to get the government to create an employment exchange for the mill workers that can

help in their reemployment. This is by no means a small achievement considering how heavily

the odds were stacked against them. However, the workers’ struggle still continues through the

134
Ibid.

171
courts to secure housing and employment for the remaining 100,000 plus workers who lost their

jobs due to the closure of the mills.

Ghag sums up the discussion about the effacement of the working poor and small

businesses in the context of contemporary urban redevelopment very starkly and it is worth

quoting here at length:

If you observe the developments happening in Mumbai in the name of transforming it into
Shanghai, for example, they have developed this skyscraper where once there stood a mill,
Morarji mill, where about 5000 to 6000 workers worked. This was a secured job. They did not
have to look elsewhere. But this kind of “development” is destroying the poor and uprooting the
working class as they cannot sustain in this environment. He [worker] is surround by plots that
cost about one to two crores [about 160,000-330,000 USD], but he do not have a job. This whole
development is anti-poor. It is not just the worker, but even small shop-keepers, chaiwalas [tea-
stall owners] are finding it hard to sustain. Earlier in Lalbaug there used to be small cloth dealers
or sweet mart vendors now they are all extinct. They are all thrown out of the mainstream
development process. They developed this Moraji Mill land, previously small traders, street
vendors used to be all around it, but now they are no longer there. These people were given a
lump sum amount by the developer and were driven away. This development is being designed in
such a way that the poor should not live in this city. Therefore, we oppose such this kind of
development. Mumbai’s land has to be allotted to the working class community. And when
development plans are designed, you must include these communities and they should be
considered as the focal point of the development strategy. In this way we continue to fight the
government through this movement. Till date no industry has allotted land for the development of
60,000 houses to its workers after that industry has been shut down. Whatever we have achieved
is still a small share. The workers must receive their fair share. So our struggle continues...135
Right over urban space

Poverty and lack of gainful employment in the rural areas and smaller towns drive most of the

people to the Indian cities. However, due to lack of opportunities for formal employment (which

has increased in the recent years due to deindustrialization and a decline of manufacturing in the

city) and inadequate skills to gain employment in the emerging trade and service economy, there
135
Ibid.

172
is increasing number of people doing informal work in the city. It is estimated that there are

around 250,000 street vendors in Mumbai, the most in any city in India. They consist of low-

skilled rural migrants or migrants from smaller towns. Also among these are former industrial

workers who have lost their jobs and are compelled to work in the informal sector. It is estimated

that out of the 250,000 street vendors in Mumbai almost 30 percent are former mill workers.

(Bhowmik 2006; Bhowmik and More 2003).

For the urban poor, street vending is the most feasible means of earning a livelihood as it

requires minor financial investment or professional skills. Much of the urban economy of street

vending is based on the sale of household goods such as clothes, leather and plastic goods

produced in the small-scale industries, as well as the sale of daily food items such as vegetables,

fruits, and low-cost meals. Street vending, therefore, provides low-priced commodities to the

urban poor, who cannot afford to shop in up-scale malls or departmental stores.

To get more insights into the issues of street vendors, I interviewed Hariram Yadav, the

Secretary of the Bombay Hawkers’ Union. Bombay Hawkers Union has been in existence since

1963 and has been involved in several campaigns for preserving street vendors’ rights. Yadav

has been with the union since 1980. He began by explaining to me the importance of street

vending to people in Mumbai, poor and rich alike:

Hawkers sell cheapest goods to the public. It is cheapest. Now in Nariman Point, people who
come from outside they serve them, now there is no hotel in that area, there is one Oberoi Hotel.
In Oberoi Hotel, some ten-twelve years ago we had dug out this information that one type of food
is charged about Rs.12000/-. Now here people who work in office they come on the streets to eat.
There are clerks, peons, security guards; there is no arrangement of food available for these
people. That is why hawkers used to work in that area. Now they have evacuated that place.136

136
Hariram Yadav, personal interview, November 7, 2009.

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However, the city-elite that consists of the government officials, upper-and middle-class

residents, and shop-owners see street vendors as a nuisance. The municipal government looks at

them as a problem of urban governance, obstruction of traffic, and crime. The upper- and

middle-class residents (through their resident associations and NGOs) confront street vendors for

their alleged encroachment of public space which according to them deprives pedestrians their

right to walk. However, Hariram Yadav counters this by pointing to the double standards of how

everyone turns a blind eye toward the encroachment by the elite in following words:

When you pass V.T station, you will see it has been cleared [of street vendors], so is P.M road, if
you go by the P.M road you will notice that they have allotted parking space. In the same place,
previously hawkers used to sit. As a rule parking has to keep on one side and not on both sides,
but what they have done is that parking space is kept on both the side and has blocked the roads.
Every day so many people pass through it and no one complaint, but if they see a hawker doing is
independent business, then they cause nuisance… One shop keeper owns his shop but does not
own the street, but now they have instated security guard on the streets. This is dadagiri [bossing]
of the BMC and the police; they support them. Before that hawkers used to sit there…. So slowly
the foot paths are acquired by the shop keepers, they want to show off that they have four cars.
That is how it is. Today car parking is a big issue and so there is lot nuisance created because of
it. And every time shops are renovated and repaired they acquire one foot of extra space….So
how will the roads be saved?
There is also misconception about the so-called unhygienic practices of street vendors. The street

vendors counter this notion by pointing out that unlike popular perception of street vending as

being disorderly and dirty, it is actually quite regulated. For example, one of the street vendors I

interviewed informed me this:

A sugarcane juice vendor has been given conditions. There are 35 conditions which they are
expected to follow. Every sugarcane juice cart owner is compelled to keep a dust bin, and they
keep the bin and if you notice you will see that not a single piece of waste is thrown on the road.
They instantly call the waste collector or throw the waste in the public waste bin on the streets.137

137
Ibid.

174
The “world class” vision of beautifying the city basically means sanitizing public space by

getting rid of street vending. This has led to increasing regulation of public space by the

municipal government and its refusal to legalize the activities of the street vendors, as well as

violent evictions and confiscation of property during raids. This status of illegality renders the

street venders vulnerable and reduces their power to negotiate entitlements from the state. Also,

it is alleged that the illegal status benefits to keep the system of extortion by corrupt government

officials and local goons. For example, Yadav in his interview informed me:

Neither the corporation nor the state government is doing their job. A Commissioner is posted for
three years. His primary motive is to please the wealthy. The whole system is corrupt. In each
ward, every hawker has to pay a hafta (bribe) of Rs.2000 to 2500 per month. It is immaterial
whether he [vendor] has a license or not. Both have to give a bribe. And they [municipal officials]
are troubling the hawker due to pressure from wealthy. They do not have any official policy on
this. This is their personal policy. For example, if a ward officer feels this hawker should not be
seen in this area, he can invoke sections 313 and 314 under the Commissioner’s Act to confiscate
any property on the streets.138
However, this status of illegality is very aptly questioned by a member of a prominent hawkers’

union in the following words:

If a candidate we vote for wins the election is considered legal, then how come my existence
becomes illegal? The one whom I give birth becomes legal and I become illegal. How this is
possible? If people who win elections by our votes are all legal then nobody has the right to call
us illegal.139
However, it is not only the state that the street vendors have to fight against, but also the middle-

classes in the city. One of the “world class city” visions in Mumbai involves beautifying the city

through a sustained campaign called Mumbai Chakachak (literally, Mumbai Shining). The

campaign is an outcome of a collaborative effort of local government agencies and a few NGOs

such as CitiSpace and Clean-Sweep. This has essentially led to increasing regulation of public

138
Ibid.
139
Ibid.

175
space by the municipal government and its refusal to legalize the activities of the street vendors.

Organizations such as CitiSpace whose agenda is to keep the streets clean and free of street

vendors have long championed the cause of municipal markets to house street vendors.

However, these recommendations have no with the existing realities in the city. Specifically

responding to this question of municipal markets, Hariram Yadav states in during the interview:

In Mumbai, there are very few municipal markets. There is one market in each ward for
vegetables. There are other markets which has 250 vending slots, in some there are 150 vending
slots, so if 50,000 people come to the market to purchase from 150 vending slots then how will
they meet the needs of the people? The spaces allotted for the markets are acquired by the
builders. Even the garden spaces are acquired by the builders.140
However, street vendors represent one of the larger and more organized sections within the

informal economy and have had a long history of organizing. Some of the main issues that the

hawkers unions in Mumbai are actively involved in currently are: the implementation of the

National Policy on Urban Street Vendors, passed in 2004; fighting corporatization and FDI in

retail; protesting against the JNNURM; fighting the National Food Safety Bill that establishes

standards of hygiene equivalent to five star hotels; and social security for the informal sector.141

Along with organized protest, the everyday politics of the street vendors involves negotiating

with the government officials through bribes and gaining patronage of local goons (Anjaria

2006). Anjaria (2006) describes how, by what is termed as “official legality,” the unlicensed

hawkers have to deal with a host of state agencies in their daily activities. One such example is

the pauti (receipt) system, under which the hawkers have to pay state officials “unauthorized

occupation cum refusal charges.” Anjaria (2006) feels this is a “clever maneuver of the state to

collect revenue from an officially illegal population” (pp. 2140-41). The informal mechanisms of

140
Personal interview, June 11, 2009.
141
Information obtained through the National Hawkers Federation.

176
street vendors also serve to self-regulate and preserve urban space, contrary to most the

perceptions of the city elites.

In recent years, a favorable court judgment, an international declaration, and a national

policy have provided a shot in the arm to the efforts of organizing the street vendors in India. In

1989, the Supreme Court, in relation to a public interest litigation announced that as per the

constitution no one can be denied the right to carry on trade or business on the street pavements,

if it was properly regulated. Similarly, the Bellagio Declaration of 1998 was instrumental in

articulating the demands of street vendors across the world as well as in the formation of the

National Alliance of Street Vendors of India (NASVI) in 1998. Since its formation in 1998,

NASVI has tried to facilitate networking among the street vendors, trade unions, and NGOs. It

has also tried to study various problems related to street vending through survey research in

order to justify the rights of street vendors; especially of making street vendors an integral part of

urban policies and granting them a legal status. In 2004, the National Policy on Urban Street

Vendors was passed which calls for recognition and legalization of “natural markets.” The policy

also recognizes street vendors’ basic rights and the importance of the services they provide both

socio-economically and in terms of urban planning (Bhowmik 2003 N.d.).

Although, the Shanghaization project seems to have gained a strong foot hold in the city,

it is one among several competing visions of urban development in the city. We have already

seen one alternative version in the form of the struggles of the urban poor to claim their “right to

the city.” In the following sections we will discuss a few more projects that did not necessarily

emerge within the framework of neoliberalization of Mumbai, but nonetheless shape the

contours of urban development in important ways. And it is will only be evident at the end of

this section the impossibility of a single idea or ideology to define Mumbai’s space.

177
Other Competing Claims on Mumbai

According to Gyan Prakash (2002), a city is a layered structure of power, experience, and

memory where class, ethnicity, religion, economy, culture, and politics are weaved into the very

texture of the city and in the spaces and rhythms of daily life.

Bombay/Mumbai is and has always been a quintessential immigrant city and India’s

ideal-type of cosmopolitanism. In 1891, out of Bombay’s total population of about 800,000, only

a quarter were born in the city (Kidambi 2007:22). Following Independence and the partition of

India and Pakistan, Bombay’s population grew rapidly between 1941 and 1951, especially in the

suburbs (Pacione 2006: 231). With over half of the population being of non-Marathi ethnicity,

Mumbai has emerged as India’s most cosmopolitan city represented by immigrants from

western, northern, as well as southern parts of India.

Mercantile groups from Gujarat (predominantly the Parsis, along with other trading and

business castes of Hindus, Jains and Muslims) were encouraged by the East India Company to

settle in Bombay in order to develop a trading center. The bulk of the local Marathi-speaking

population in the city was engaged in non-commercial activities, with only a small minority of

western educated elites working as professionals. The establishment of the cotton textile industry

in the mid-19th century transformed induced additional migration of peasants from the

countryside, particularly from the coastal areas of Konkan in the south of Maharashtra, who

came to work in the textile mills of Bombay. This led to the formation of a distinct working class

mill district known as Girangaon (the village of mills). The population of Bombay grew

exponentially since the 1940s, especially after independence, with the influx of migrants from

what is now Pakistan. Other migrants included people from various deprived castes (such as

Dalits) from the hinterlands of Bombay and other regions of India. The unavailability of

178
adequate housing to accommodate the rising tide of migrants in the city led to the proliferation of

slums, which have become a characteristic feature of contemporary Mumbai. Thus, we find that

the ethnic, class, caste, and religious divisions in Mumbai were maintained by the changing

economic structure of the city (Kosambi 1995; Patel 2003, 2006).

It is in within this rich history of layered cosmopolitanism that we can trace the

contemporary ideological strands that simultaneously constituted as well as contested it. At

various moments in Bombay’s/Mumbai’s history there emerged distinct imaginaries, some of

which continue to exert claims over Mumbai’s space and imagination.

Mumbai of the Marathi Manoos (person)

On Sunday, October 19, 2008, north Indian candidates appearing for the all-India Railway

Recruitment Board entrance exam in Mumbai were beaten up in Mumbai. Anti-north Indian

slogans were heard outside the exam centers. The people behind these attacks were activists of

the newly formed political outfit called Maharashtra Navnirman Sena or Maharashtra (MNS)

roughly translated as Maharashtra Recreation Army.142 This party is a splinter group of the Shiv

Sena (SS), which has been a dominant force in the local politics of Mumbai since the 1960s,

under the leadership of Balasaheb Thackeray. In 2006, Balasaheb Thackeray’s nephew Raj,

popularly considered as the heir apparent to the ailing patriarch broke-away from the party to

form him own party MNS. Led by a similar persona and oratory skills as his uncle, Raj

Thackeray and the party’s aggressive street politics, the MNS has already made its mark on the

political landscape of the city and the state. In their first outing as a political outfit in the 2009

state assembly elections, the party won 13 seats (out of 288) in the state, splitting the Marathi

vote with its parent party the SS in Mumbai city. In Mumbai the party won six seats and a 23.8

per cent of votes and emerged as the second largest party in the metropolis after the ruling
142
Rahi Gaikwad, “North Indians attacked in Mumbai.” The Hindu, October 20, 2008, p.1.

179
Congress-NCP coalition. On the other hand, its cousin SS and its ally BJP lost 30 per cent of

their seats in Mumbai due to the MNS.143 Quite an achievement for a party that came into been a

few years ago in 2006. However, in the latest municipal elections in 2012, Shiv Sena-BJP

alliance won majority seats 107 out of total 227 seats (Shiv Sena 70, BJP 32), while MNS won

28 seats.144 So together, the SS and MNS won almost 100 seats. These elections results bear

testimony to the popularity of the MNS and SS among the local Marathi population.

In its 2009 election manifesto, the MNS listed the following objectives among others:

~raising the status of Maharashtra State, its people and the Marathi language to its resplendent
glory
~development of the Marathi language
~to serve the interest of the Marathi Manu—a person living in the State and born to Marathi
parents, or one, though of a different linguistic origin, born in Maharashtra, who speaks Marathi
and loves Maharashtra.
~To give justice to the Marathi Manus, MNS will do everything from establishing a Marathi
Language Academy, fighting with the anti-Marathi lobby, making Marathi a compulsory subject
in all schools, insisting for Marathi name-boards on shops and establishments to broadening the
knowledge base in Marathi. These activities, constructive as well as street-level campaigning will
be pursued at the same time.
~eliminate the interference of the Non-Marathi power-mongers from outside the State in the
State’s politics and social life thereby reinforcing the existence of Maharashtra for the Marathi
Manus.
The roots of the above nativist “sons of the soil” ideology lay in the 1960s with the emergence of

a regional movement for separate statehood for Maharashtrians with the demand that Bombay be

made the capital of that new state and that the Marathi-speaking population be given priority in

terms of employment (Gupta 1982; Katzenstein 1979; Lele 1995).145 This popular Samyukta

143
“MNS gives Congress Raj a Hand.” The Times of India, October 23, 2009.
144
“BJP-Shiv Sena wins Mumbai municipal polls.” The Times of India, February 11, 2012.
145
At the time of the movement Bombay Presidency and later Bombay State comprised of present-day Gujarat and
Maharashtra. As a result of this movement two separate states of Maharashtra and Gujarat were created in 1960 and
Bombay was made the capital of Maharashtra.

180
Maharashtra Movement (SMM) brought to the fore the contradictions between the dominant

Marathi agricultural elite of Maharashtra and the non-Marathi elite in the industry. Although the

movement was dominated by the left forces, there was a section of staunchly anti-communist

within the movement, one of which was represented by an eminent journalist K.S. Thackeray,

Balasaheb Thackeray’s father. With the formation of Maharashtra the movement lost its potency.

The period, following the creation of the new state and the formation of Shiv Sena in 1966 was

marked by political and economic crisis due to slow growth and rising prices (Lele 1995). It is in

within this crisis that Shiv Sena was born and took up the cause of mobilizing the disenchanted

Marathi middle and lower class and caste groups who shared this perception of disadvantage

compared to the relatively well off south Indian migrants. Along with this anti-migrant program

it also violently opposed the communists in the city by breaking the backbone of the left-led

trade unions. However, it became more successful in the late 1960s when it began mobilizing

underemployed and unemployed youth in the city and therefore, slums became the main

constituencies of the SS. It began to provide financial assistance to migrants and slum dwellers

toward their basic needs of food, leisure, and housing. In a situation where land was becoming

scarce, the SS used its muscle power to encroach on lands and enable construction of slums

creating this image of the dada or elder brother or protector among the slum dwellers (Patel

2004; 2006). It continued to maintain its presence by enacting mass spectacles during various

religious festivals. Thus, a stable Marathi audience was created by the SS through a politics of

nativism and violence that conveniently constructed the “other” according to its waxing and

waning influence. Initially it grew out of a movement to incorporate Bombay within the state of

Maharashtra during the period of reorganization of states after independence. In the later period,

it exploited the crisis of the 1960s in fueling anti-outsider sentiments among the unemployed

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Marathi youth. As its influence began to fade in the 1970s, the Shiv Sena regenerated itself

through right-wing Hindu supremacist politics.

In the early 1980s, the SS began to assume a religious overtone by claiming to be a party

of the Hindus. A turning point in this regard was in 1984, when it formed a political alliance with

the Bhartiya Janata Party (BJP) in a context of its losing appeal in Bombay. Lele (1995: 204)

argues that the material basis for the “saffronization” of the Shiv Sena was provided by its

involvement in the emerging “predatory capitalism” based on the new capital-state-crime

nexus.146 With expansion of Bombay’s illicit commercial and financial links based on real estate,

drug trafficking, and arms places such as Dubai became safe havens for this predatory

capitalism. In a context of increasing economic opportunities for Indian Muslims in the middle-

east, the Shiv Sena conveniently used images of individual Muslim dons of crime syndicates

operating in the middle-east led to criminalize the Muslims and spreading anti-Muslim

sentiments. This anti-Muslim sentiment was also generated by carefully orchestrated riots in

different part of the city in order to gain sympathy for its cause. Muslims were portrayed as being

aggressive, conspiratorial, and criminal, while the Shiv Sena was portrayed as a “righteous

vigilante organization” serving to protect Hindu communities (Lele 1995: 202). The support for

the ideology of Hindutva continued to grow throughout 1980s and in Bombay for the first time

the Shiv Sena was able to gain control of the Bombay Municipal Corporation in the 1985

elections. Moreover, the alliance also claimed state power in the mid-1990s and officially

renamed Bombay as Mumbai. Today, the splinter group of the Shiv Sena, the MNS, perpetuates

this anti-migrant, anti-Muslim rhetoric and violence in Mumbai. This growing influence of the

Shiv Sena and the MNS is considered by scholars as the “decosmopolitanization” or

146
The term “safrronization” is used by critics to refer to the politics of right-wing Hindu nationalism (Hindutva)
based on glorification of ancient Hindu past. The saffron color refers to the saffron robes worn by Hindu saints and
also the primary color of self-representation used by right-wing political parties such as the BJP and the Shiv Sena.

182
“provincialization” of Mumbai as seen in the attempts to claim Mumbai as Marathi and Hindu

(Appadurai 2000; Varma 2004). However, its creation and sustenance as an urban movement is

rooted in the modern economic and social fabric of the city, what Hansen (2001) refers to as

“vernacular modernity.”

The Mumbai mafia

Perhaps one of the most under researched, but widely acknowledged feature of Mumbai’s

culture, economy, and politics is Mumbai’s mafia. It influences practically every spheres of city

life—business (film production, real estate, gold smuggling), administration, and politics (Varma

2004). The “underworld” of extortion, smuggling, drug trafficking, and drug peddling emerged

within the state-sponsored capitalism that regulated imports, thereby fueling the growth of black-

market smuggling. However, with liberalization of the Indian economy with the economic

reforms in the 1990s, the underworld has diversified its portfolio to include the real estate

market. Liberalization has led to the entry of transnational capital into the city that has spurred

the growth of “casino capitalism” and spiraling real estate prices in the city (Nijman 2000). It is

in this suitable speculative environment that the mafia (with the illicit supported of the nexus of

politicians, bureaucrats, and the police) has emerged as a key figure in Mumbai’s land

development and local politics (Weinstein 2008). The initial involvement of criminal gangs in

the real estate was in the context of “sick” textile mills, where their help was sought to discipline

workers who resisted the sale of mill lands. The story of mill murders such as that of the textile

mill owner Sunit Khatau also bear testimony to the growing influence of the underworld

(D’monte 2002).

In 2007, there an arrest of four hit men in Mumbai brought the builder-underworld nexus

to the fore. Earlier the underworld used to play a support role to the builder in terms of helping

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the builder vacate or gain control of a property. However, with the boom of the real estate has

started attracted the underworld to engage directly into the business of construction. In a very

bollywood like script, a developer who was involved in a Rs. 500 crore (around 84 million as per

current exchange rate) was kidnapped at the request of a rival builder and forced to meet with a

notorious gangster in prison, who threatened the builder to let go of the claim for the project. The

threatened builder in return approached a politician with links with the underworld to kill the

rival builder. However, as the shooters were waiting for the other rival builder to come out of a

hotel they were arrested by the police.147 Stories like these are becoming commonplace in the

real estate business. Interestingly, a newspaper article points out that increasing people’s

participation in the redevelopment process is actually leading to common people, who earlier

remained unaffected by the gang rivalries, are now getting caught up in this dirty game. For

example, in 2008, residents of various co-operative housing societies demonstrated against the

growing builder, politician, and bureaucrat nexus. One of the residents alleged that the when she

refused to go with the decision of the building’s managing committee to appoint a particular

builder, her signatures were forged and when she challenged the forgery the builder threatened to

kill her and abduct her daughter. According to her when she went to approach the authorities for

help, the builder would be tipped off and he would be there at the scene and no action would be

taken against him. In another incident a lady without any notice was evicted from her apartment

with the help of the police.148

Many a times the builders act as front men for the mafia in various redevelopment

projects. In 2008, the Slum Rehabilitation Authority (SRA) publicized a tender for building

147
Mateen Hafeez and S. Ahmed, “Real estate boom lures underworld,” The Times of India, March 12, 2007.
148
“Housing redevelopment plans: Residents protest ‘nexus between builders, politicians, and bureaucrats,” Express
New Service, August 2, 2008. Retrieved on July1, 2013 (http://expressindia.indianexpress.com/latest-news/housing-
redevelopment-plans-residents-protest-nexus-between-builders-politicians-and-bureaucrats-/343646/).

184
residential and commercial buildings on slums, it was found that as many as 25 proposals came

from builders who were associated with the Dawood Ibrahim, a notorious criminal who runs

crime syndicate and is now also known to have links with the terrorist outfits in Pakistan.149

R.N. Sharma (2007:292) argues, that real increase in housing prices is due to the speculation and

profiteering by businessmen and points out that at any point in time, over 15 per cent of the

newly constructed units in the city remain open for speculation which earns the promoter and

builder 100 to 500 per cent returns on their investment, which has to be shared with the

politicians, bureaucrats, and the mafia.

The continued nativist appeal of Shiv Sena in the urban context of Mumbai highlights the

fact that polarization and social exclusion is as much as part of the Indian domestic political

social structure as it is of global forces (Heller 2010). In this context, Heller (2010:440) argues

that “while the contours of inequality in Mumbai are obviously structured by market forces, they

are also organized through a whole range of categorical inequalities of gender, caste, community,

and ethnicity (including a complex layering of immigrant groups from different states) that

overlap with, but do not simply reflect class differences.” In such a situation, access to basic

resources such as work, housing, food, water, education, and health gets organized through these

categorical inequalities (Zérah 2008). This leads to a politics of patronage based on religion and

ethnicity where the urban poor in order to have their demands met have to interact with the state

as clients or members of particular groups, rather than rights-bearing citizens. Moreover, their

interactions assume the form of exchanges, not rights (Heller 2009:138). However, as

highlighted by the emerging poor people’s movements in Mumbai we see a radical departure

from this form of political mobilizing. By structurally unifying the urban poor across their

categorical identities, the poor people’s movements have managed to in an assertive rights-based
149
S. Balakrishnan, “Builders with D-link pitch for SRA schemes,” The Times of India, May 24, 2008.

185
approach make their demands. And as we see in the earlier discussions, this approach has been

fairly successful. Even the movements such as those of the Shiv Sena and now the MNS

although they mobilize people on the basis of their parochial identities, class based inequalities

form the context within which they occur. Nonetheless, one cannot deny their existence as they

cannot be completely subsumed by class. Therefore, it becomes all the more crucial that any

genuine attempts of economic growth must go beyond growth itself and also simultaneously

address these categorical inequalities. Moreover, the mafia poses a severe challenge to growth

and calls for reforms in governance as well as the land market. However, these cannot happen

without a structural transformation in the democratic polity. This highlights the need for a more

holistic approach toward growth and not the narrow sectorally defined approach of the

Shanghaization strategy.

186
 CONCLUSION

Urban development has assumed increasing importance in contemporary globalization,

especially in the megacities of the South which are consciously trying to reposition themselves

globally to maximize their comparative advantages. However, we need to be attentive to the

particular socio-historical contexts within which these cities are reimagining globalist futures.

The recent “rise” of emerging economies in Asia (particularly India and China) has

generated an interesting set of contradictions. At the aggregate level, sustained economic growth

in the region has led to substantial reduction in poverty and hunger. Moreover, this growth has

been achieved without a faithful adherence to the “blue-prints” of the Washington Consensus.

However, the economic growth has been extremely uneven, giving rise to widespread

inequalities. In China, this is evident in the growing disparities between the rural and urban

areas, coastal and inland regions, and city-dwellers and migrants. In India, a time of

unprecedented national prosperity has witnessed increasing urban poverty and the severe neglect

of the agricultural sector, reflected in its most brutal form in the increasing rates of farmers’

suicides in the country.

This study tried to unravel some of the above contradictions by focusing on the

experience of two leading cities of Asia: Shanghai and Mumbai. Cities in Asia have grown

rapidly in recent years and have contributed significantly to their respective national growth

rates. In the Chinese case growth has been more dramatic as seen in the complete makeover of

Shanghai in a relatively short period of time. Shanghai’s transformation has inspired the business

and political elite in Mumbai to devise similar strategies of fast growth. However, they seem to

be unaware of the realities of Shanghai’s developmental path and are enamored more by the

modernist appeal of the city.

187
 The Shanghai model as it evolved in China is deeply problematic and is one of the main

reasons for the imbalanced development in China. Formulated in the 1980s, this model was a

precursor to China’s anti-rural bias and suppression of small scale and labor intensive

entrepreneurship. Further, this model also has become synonymous with forcible evictions of

vulnerable populations, corruption by real estate developers, and rural impoverishment. Finally,

the model is extremely expensive and subsidized at the cost of investments in other crucial

sectors such as rural development, education, and health. Even within China, this model has

undermined the micro-economic foundations of initial Chinese growth led by small-scale rural

entrepreneurs and has also contributed to the growing regional and income inequalities (Huang

2008c).

Some scholars saw the Shanghai model of development as yet another variety of a

neoliberal model of accumulation, while a few others understood it more as a political operation

in the context of a changing political environment in China. Nonetheless, a non state-centric

analysis of neoliberalism that focuses on neoliberal technologies and rationalities does lend some

support to the neoliberal thesis in relation to China.

The demonstration effect of Shanghai’s “fast growth” is felt even beyond China,

especially in Mumbai. In the context of a resurgent Asia, Shanghai is an attractive non-Western

model that appeals to the political and business elite, preoccupied with sustaining the high

growth agenda. In the particular context of Mumbai, Shanghaization is not simply a result of

global forces acting on the local. It is historically contingent and is articulated through a variety

of social actors at multiple scales. Therefore, Shanghaization can be understood as particular

kind of “worlding” based on inter-referencing that takes place at a particular time in world-

history, characterized by an ascendant urban Asian world (Roy 2011). Mumbai’s “art of being

188
global” is actively constructed by a constellation of actors involving the corporate sector, the

national and subnational states, and the urban middle classes, for whom the idea of a “world

class city” carries great resonance. For the national state, it serves its purpose of sustaining the

national momentum of macroeconomic growth, for the subnational state, led by powerful

business interests a “world class city” is a tremendous opportunity for accumulating profits

(especially through land development), while for the enriched urban-middle classes, a “world

class city” is about realizing a consumerist ideal.

As a model of development, Shanghaization is narrowly focused on economic growth

rather than the broader welfare implications of growth. Its fast growth strategy is based on real

estate revitalization and development to spur economic growth, infrastructure, and transport

improvement designed primarily to encourage new private (foreign) investment and property

development. It is basically an entrepreneurially-driven, accumulation model which engenders an

elitist reimagining of the city that caters to the educated urban middle-classes who are well

positioned to reap the benefits of an interconnected world. In Roy’s (2011:10) words

Shanghaization of Mumbai represents:

[T]he production of an Asian urban capitalism that self-consciously presents itself as Asian, that
deploys the motifs of the Asian century and that references other Asian models. In their crudest
form, these worlding practices legitimize national projects of primitive accumulation, often
deepening socio-spatial inequality and injustice.
Therefore, the development visions espoused by Shanghaization are not only incapable of

addressing issues of structural urban poverty and inequality in Mumbai, but on the contrary,

potentially deepen already existing inequalities.

Recent critical urban scholarship complicates our understanding of an emerging urban

world by acknowledging contestation and uncertainty related to urban change. The contemporary

elite worlding of Mumbai represented by Shanghaization is inherently unstable because this

189
violent form of urban development leaves the majority of the urban poor out of its vision. But the

tenacity of resistance shown by various poor peoples’ movements in Mumbai has shown that any

technical, top-down attempt of restructuring city space in Mumbai is bound to be met with stiff

opposition. Through these movements, the urban poor make themselves visible by claiming their

“right to the city.” Harvey (2004:23) defines the “right to the city” not only as individual access

to urban resources, but also as “a collective power to reshape urbanization”—a right to change

the city. As seen in the case of the three urban poor movements analyzed in this study, the urban

poor in Mumbai go beyond mere access to urban resources: land, housing, and work. They also

lay claims on the future on the city by elaborating their indispensable role in the historical

development of the city. They claim their “right to the city” by inverting the whole logic of

“illegality” and “encroachment” by unmasking the illegal and encroached urbanism of the elite,

thereby calling for a “just” and “equal” city. Moreover, this emerging urban politics in Mumbai

transforms the discourse of citizenship from formal national state membership to its substantive

aspects related to civil, political, socio-economic, and cultural rights (Holston and Appadurai

1999). This has tremendous potential to enlarge the scope of urban development which is

currently equated with rapid economic growth as an end-in-itself toward a more redistributive

and inclusive growth that serves as means for broad-based development. Thus, transforming

Mumbai into Shanghai does is not merely an economic project, but is an inherently contested

political project that raises a fundamental question: Whose City is It?

From Inclusive Growth to Inclusive Development

A critique of rapid economic growth should not undermine the role of economic growth in

development. Sustained economic growth is crucial for poverty reduction; however, for growth

to be sustainable in the long run it should be broad-based involving all economic sectors.

190
Further, it should also be inclusive to allow contribution of large sections of the country’s labor

force (World Bank 2009b). Therefore, inclusive growth is concerned not only with the pace of

growth, but also with the pattern of growth.

“Inclusiveness” as a concept encompasses equity, equality of opportunity, and protection

in market and employment transitions (The Commission on Growth and Development 2008).

Equity refers to creation of equal outcomes, while equality of opportunity refers to equal starting

points. Markets are not capable of ensuring equity; therefore the government has to play an

important role in creating equality by providing universal access to public services like health

and education and in promoting job opportunities. In this regard, there is a need for pragmatic,

gradual, and experimental policies that are sensitive to particular historical and social contexts.

Growth is not an end in itself, but a means to end (broad-based development). The

emerging consensus in development theory is that any inclusive, broad-based development has to

have in place social institutions that are developmental (that sustain high rates of growth and are

redistributive), socially inclusive, and democratic, respecting human development of all citizens

(Mkandawire 2004). Rather than thinking in terms of trade-offs between equity and efficiency

and between social and economic development, we need a supply-side “productivist approach”

to social development that not only focuses on social capital, but which also enhances

productivity and output, rather than relying on the conventional demand-side consumption

approach (Nederveen Pieterse 2001). In adopting such a developmental approach there is a need

to focus on “development as imminent change” that happens from within and which incorporates

the needs and aspirations of most of the citizens rather than catering to a select few (Nederveen

Pieterse 2001:126).

191
Futures

The alarming growth of inequalities and its discontent has forced the Chinese and the Indian

governments to address the issue of inclusive growth. In 2003, President Hu Jintao rhetorically

moved away from the Shanghai model of development and adopted the goal of “harmonious

society” based on a new approach of “scientific development” (kexue fazhanguan) or

“comprehensive, coordinated, and sustainable development.” This new approach seeks to correct

the earlier overemphasis on GDP-focused and reign in run-away unequal growth that neglects

social welfare. The new official rhetoric has now shifted from “economic growth” to “social

harmony” incorporating sustainable development and social welfare (Fewsmith 2004:1).

Similarly, India’s Planning Commission has made inclusive growth as their goal in the eleventh

(2007-2012) and twelfth (2012-2017) five year plans focusing on poverty reduction, bridging

gender and regional divides, and sustainable economic growth (Government of India 2006). In

2006, India also launched the National Rural Employment Guarantee Act or NREGA, the

world’s largest social welfare scheme aimed at completely eliminating poverty.

However, the agenda of inclusive growth is ridden with several challenges. In China, as

discussed in chapter 3, the current administration has to balance competing political factions,

including a dominant section of the “Shanghai Clique” which has vested interest in preserving

the Shanghai model of fast growth. In India, despite all the talk of inclusive growth, there is no

agreed upon definition of the term. Even welfare programs such as NREGA has failed to live up

to its objectives and studies have found the program mired in widespread corruption, caste-based

discrimination, and lack of political coordination between the center, state, and local bolides in

running the program (Jeelani 2010).

192
 To conclude, it remains to be seen if the lofty goals of inclusion turn out to be an empty

rhetoric, or whether they are transformed into genuine action to address issues of structural

inequality and poverty in these two cities. Regardless, one thing is very clear, rather than chasing

and celebrating double-digit growth rates, cities in the South need to rethink their developmental

agenda. In the case of Mumbai, the most urgent task at hand is to provide basic amenities of

sanitation, housing, and transportation for the majority of its citizens and to promote the small-

scale informal sector where most of its citizens toil. Simply importing “blue-prints” such as the

Shanghai model will not only be inappropriate to the local needs of the particular society (such

as Mumbai), but it also means adopting models which have not worked well in the first place.

193
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