As expected PM Narendra Modi has approved an umbrella programme—Digital India- comprising various projects worth about INR 1 lakh crore ie USD 20 Billion to transform the country into a digitally-empowered knowledge economy. The Digital India programme includes projects that aim to ensure that government services are available to citizens electronically and people get the benefit of the latest information and communication technology (ICT).
The Digital India programme is a transformed version of the already running National e-Governance Plan. It is in addition to 100 Smart Cities project in the next 5 years. The Mega trend of Smart Cities is set to drive urban development for the next decade and will drive demand for response, storage, multi-energy networks, smart devices, and new business models. In 2025, it is expected we will have around 26 global Smart Cities which will feature five of the eight aforementioned parameters. Around 50 percent of these will be located in North America and Europe.
There are several cities that are focusing on specific aspects that help it run efficiently, such as on their transport, energy and waste management. In example, implementation of smart grids is being pushed heavily for smart energy management. Eight key aspects that define a Smart City are smart governance, smart energy, smart building, smart mobility, smart infrastructure, smart technology, smart healthcare and smart citizen.
Frost & Sullivan research estimates a combined market potential of $1.5 trillion globally for the smart city market in segments of energy, transportation, healthcare, building, infrastructure, and governance. If one compares that to GDP of nations in 2014, it will sit above the GDP of Spain, thus making it the 12 largest GDP in the world. Yet, while the potential is huge, the challenge faced is finding funding and developing the right business model, as many cities in the Western world do not have the finances available to take on some mammoth-sized projects. As such, four main models that will be used, through which companies will engage with city authorities and utilities to tap into this market will be used: Build Own Operate (BOO), Build Operate Transfer (BOT), Build Operate Manage (BOM) and Open Business Model (OBM).
Based on Frost & Sullivan’s study on “Strategic Opportunity Analysis of the Global Smart City Market” published in 2013.Smart Cities & Digital India Initiative by GoI
