Investment in vocational training and qualification of labour not only in the property industry is a prerequisite for the success of the 100 Smart Cities-initiative of the India government
Everyone is aware that India's cities are expanding at a tremendous pace and it was in this context that the Indian Government introduced the "100 Smart Cities" initiative in order to modernize cities and make them internationally competitive.
The aim of the initiative is to cater for the increasingly high rate of rural migration to the cities, the desire for better living standards among the growing middle class and to relieve congestion and growth pressure on the larger cities.
With an urban population currently around 31% of the total population contributing to over 60% of India's gross domestic product (GDP), it is projected that, due to the continuing growth, urban India will contribute nearly 75% of the national GDP in the next 15 years.
It is for this reason that India's urban areas need to be planned well. And planning does not mean the architecture's or business perspective only. The most important factor in a sustainable city is its infrastructure.
Along with improving the roads, especially ring roads, building good quality but affordable housing, modernizing public transportation and the electricity supply, it also includes upgrading the water supply and networks, as well as water treatment systems.
While the focus of many government initiatives is more on the development of connecting highways or special economic zones, 5 months ago the Modi government launched two initiatives, along with the smart cities mission, which aim at improving water sewage and water supply networks in urban areas: the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Pradhan Mantri Awas Yojana ('Housing for all' Scheme).
Looking, at the construction sector in India, for example, the issue here of labour shortage is huge, with real-estate developers often blaming project delays on the severe lack of qualified labour.
Skilled employment in this sector is set to rise due to a demand for affordable housing which is expected to increase to 38 million from the current 29 million by 2030.
Also the demand for warehousing space, both ambient and cold chain in Tier-I and Tier-II cities is expected to increase since industrial parks are being set up which will in turn increase the need for skilled workforce in the construction sector.
Accompanying the rapid growth in this sector, there will also be the corresponding need to invest in training and qualifying employees of the property industry. This is a diverse sector which employs people with a variety of skills, involved in all aspects of property across commercial, industrial, residential and agricultural sectors.
In the water supply sector, it is more than certain that many national and international companies will be competing to construct the required water supply and sewage networks as well as the corresponding water treatment and purification facilities.
Here again, there is the issue of the lack of qualified staff, and according to a German industry representative, "The real difficulty is in the operation of treatment plants".
At first this might seem counter-intuitive, as manpower is high and comparably cheap in India, especially among the unskilled or semi-skilled workforce. In talks with the quoted industry expert and other representatives, however, they all have the same demand: For the sustainable operation and maintenance of water supply and treatment systems qualified personnel are needed for the operational tasks.
Also in a study conducted in Pune by a German consortium and financed by the German Federal Ministry of Education and Research, water treatment plant owners and operators stated a clear need for skilled staff on the working level ("Modernizing Vocational Education and Training in Water Management", 2015).
Based on data from the 68th Round of India's National Sample Survey Organisation, it is estimated that only 4.69% of India's total workforce has undergone formal skills training, compared with 52 % in the USA, 68 % in the UK, 75 % in Germany, 80 % in Japan and an astounding 96 % in South Korea.
In all of these countries, vocational training programmes, with their successful mix of theory and practice (between 30 – 50%), are considered a key driver for economic growth and success.
The reason for this is simple: A better educated workforce makes less mistakes, works more efficiently (fewer persons are needed for one task) and generally has a better process understanding, thus enhancing the general operation processes, which include maintenance and repair.
Coming back to the operation and maintenance of water supply and treatment systems in India, it is an easy calculation to figure out that skilled personnel will not only help to staff all the new treatment plants, but are also a key to the success of India’s smart cities initiative: Without a functioning water system the value of a new housing society is, in the long-run hardly higher than a slum area. Water supply and water treatment make the difference between "just having a roof over one's head" and a livable, valued home.
In contrast, too, to other countries, India's real estate and construction companies cannot necessarily rely on the government to build these facilities for their premises: Housing societies of more than 140 units will have to build their own water sewage plant on-site and sustain the potable water supply.
Constructing a water treatment plant, even a micro plant for a housing society, involves a huge investment which the housing society owners will have to pay off over many years.
"What happens in reality is that the water treatment and water supply facilities of housing societies are completely run down or out of order, long before the owners have paid off the Investment", said one insider, who runs a leading real estate company in Northern India.
The low level of maintenance, he continued, can only be confronted with skilled manpower who know about the importance of proper machine maintenance and procedures necessary to enhance the lifecycle of a treatment plant.
Recognising the huge need for qualified staff in water treatment plants, and based on the results of the above mentioned study, the Indo German Competence Academy (IGCA) Private Ltd. was established in Mumbai and Pune and has started offering vocational training courses in the field of wastewater treatment and water purification.
Training is, initially, for semi-skilled and unskilled workers who will be qualified and trained in the training centres and on-site, for example on the plants of its industrial partner REMONDIS, a German international waste disposal and recycling corporation engaged in the water sector in India.
With our trainings in the water sector we close the gap many housing societies, construction and real estate companies are facing. Finally they will have access to skilled personnel for their treatment plants," says Captain Shivaji Mahadkar, CEO and one of the Joint-Venture partners of IGCA.
To set up the institute he joined hands with a German training provider, VESBE(Association for European Social Work, Training and Education). Based on the success of their training in water management, IGCA is establishing further training areas, for example construction, welding, plumbing and so on in accordance with industry needs.
Training in the construction sector, for example, will not only focus on qualifying workers by enhancing their skills but also on reducing re-work and cutting down wastage and costs for both contractors and developers.
Jürgen Lau, the co-founder of IGCA, explains the advantages of a trained workforce: "Construction companies and housing societies will benefit hugely from our programme. Indian construction companies are well aware of how to build water treatment or water supply plants. But many of them are quite naive in their thinking ahead: Operating and maintaining the plants is namely a huge challenge. IGCA offers to train the manpower accordingly so that plant owners will need less staff, increase the quality of operation, reduce the maintenance costs and enhance the lifecycle of their plants."
While there are many construction companies taking Modi's pledge for smart cities as a construction task only, companies and also policy makers should think about how to keep these smart cities livable and viable once they have been constructed.
Erecting or developing a city is only a first step; without people, culture, change, viable business – and, in particular – maintenance, it can all fall apart within a few years.
The Indo German Competence Academy (IGCA) was founded as a joint venture by VESBE and the Takshashila Trust, India in October 2015. Headquartered in Mumbai with a branch office in Pune, IGCA intends to expand the scope of its training activities to other VET sectors and locations around the country in the future by offering franchises.
The further expansion of IGCA's training activities will be mainly focused on emerging and specialised vocational education and training sectors so as to support and compliment the trainings at Industrial Training Institutes under the Directorate General of Employment & Training (DGET) in India.
VESBE is a German association, which provides training courses and apprenticeships in Germany, and is also active in international projects in the sector of vocational training.