Phases of Urban Policy and Planning in India: 1951 Onwards

How a country chooses to manage its cities reveals a lot about its larger ambitions. In the decades after Independence, India’s approach to its towns and cities shifted several times, moving from grand physical blueprints to a focus on smaller towns, and finally toward markets, reforms, and private investment. Looking at urban policy from 1951 onwards as a series of distinct phases helps make sense of why our cities look and function the way they do today. Each phase carried its own assumptions about who should plan cities, who should pay for them, and what problems mattered most.

Why study urban policy in phases?
First phase (1951-1966): the master plan era
Rehabilitation after Partition
Master plans and institution building
Second phase (1969-1984): balancing the urban hierarchy
The push for small and medium towns
Tackling urban poverty
Third phase (1986 onwards): liberalization and the reform turn
The National Commission on Urbanisation and the 74th Amendment
JNNURM and the rise of reform-linked funding
What the three phases tell us

Why study urban policy in phases?

Urban policy did not evolve in a straight line. Priorities changed as the economy changed, as the population grew, and as the limits of earlier strategies became obvious. Scholars generally divide the post-1951 period into three broad phases, each shaped by the dominant thinking of its time. These phases reflect changing demographic patterns, economic priorities, and governance approaches rather than just the passage of time. The phases are not rigid boxes, and some programmes overlapped, but the framework is useful for tracing how the state’s role expanded, contracted, and transformed.

The first thing to note is that organised planning in the country began with the establishment of the Planning Commission in 1950 and the launch of the First Five Year Plan in 1951. Urban policy was embedded within this larger planning machinery, which means city-level decisions were often driven by national economic goals rather than by the cities themselves.

First phase (1951-1966): the master plan era

The earliest phase was dominated by physical planning and a strong belief in the state as the primary builder and provider. This was a period of repair, reconstruction, and ambitious blueprints.

Rehabilitation after Partition

The years immediately around Independence were consumed by an enormous humanitarian task. The displacement of people during Partition created an urgent need to house and resettle refugees. The government responded by building a number of refugee townships that provided employment in industry, trade, and commerce. Cities like Delhi absorbed large refugee populations, and entirely new colonies were laid out to accommodate them. This rehabilitation work set the tone for a state that saw itself as directly responsible for shelter and settlement.

Master plans and institution building

The signature instrument of this phase was the master plan, a comprehensive land-use document borrowed largely from Western planning practice. The idea was that a city’s growth could be controlled and directed decades in advance by zoning land for specific uses. The Delhi Master Plan, prepared in this period, became the most famous example and a template for other cities. Urban planning in this phase was heavily influenced by the master planning approach, with a strong emphasis on managing and regulating large cities.

This was also a period of building institutions. The government recognised housing as a critical sector and set up bodies to coordinate it. The Ministry of Works and Housing was established in the early 1950s and the National Buildings Organization was created in the mid-1950s to research building technologies, while state housing boards began to appear to implement schemes. The First Five Year Plan allocated resources for housing industrial workers and low-income groups, reflecting a state-centric model where the government was the main supplier of housing.

The weakness of this phase became clear over time. Master plans were rigid documents that struggled to keep pace with rapid, often unplanned growth. Physical planning frequently failed to connect with the economic realities of how cities actually grew, leaving a gap between the neat lines on a plan and the messy expansion on the ground. The Third Five Year Plan tried to address this by preparing comprehensive development plans for major metropolitan centres, but the planning process was disrupted after 1965 by the Indo-Pakistan conflict, drought, and a financial squeeze.

Second phase (1969-1984): balancing the urban hierarchy

After a break and a series of annual plans, the Fourth Five Year Plan resumed in 1969. The second phase marked a clear shift in thinking. Instead of concentrating attention on a few big cities, policy turned toward spreading urban growth more evenly across the country and confronting the poverty that cities were producing.

The push for small and medium towns

By this stage it was obvious that population and economic activity were piling up in the largest cities while smaller towns languished. The policy response was to strengthen these smaller centres so they could hold their own populations and attract migrants who would otherwise head to the metros. The Sixth Five Year Plan stressed the need to develop small and medium towns, and in 1979 the government launched a major scheme to do exactly this.

The Integrated Development of Small and Medium Towns (IDSMT) scheme, a centrally sponsored programme, was initiated in 1979-80 with the explicit aim of slowing migration to large cities by investing in the infrastructure of smaller urban centres. The logic was that better roads, water, and basic services in a small town would make it a viable alternative to a crowded metropolis, while also supporting the rural areas around it. The scheme ran for decades with periodic modifications.

The results were mixed. Evaluations found that while IDSMT did improve infrastructure in many towns, it showed limited success in actually changing the pattern of population concentration. Census data continued to reveal a steady concentration of people in the largest cities, driven by both natural growth and migration. The pull of big-city opportunity proved stronger than the modest improvements made in smaller towns.

Tackling urban poverty

This phase also saw the state acknowledge that urbanisation was generating slums, squatter settlements, and deep poverty. The earlier focus on physical layouts and housing for workers gave way to a recognition that the urban poor needed targeted help. The thinking drew on international ideas of the time, including the emphasis on meeting basic needs such as shelter, clean water, employment, and sanitation. Programmes in this phase began to address urban poverty more directly, setting the stage for the dedicated poverty-alleviation and slum schemes that would expand in later years.

Third phase (1986 onwards): liberalization and the reform turn

The third phase represents the most significant break from the past. The state stopped trying to be the sole builder and financier of cities and instead began to act as an enabler, drawing in private capital and pushing for governance reforms. This shift was tied closely to the broader economic liberalization of the early 1990s.

The National Commission on Urbanisation and the 74th Amendment

A turning point came with the National Commission on Urbanisation, which submitted its report in 1988. The Commission examined the full range of urban issues, from spatial planning and land to housing, water, transport, and finance, and it even identified 329 urban centres with high growth potential. Its work signalled a more strategic, nationwide view of cities as engines of growth rather than problems to be contained.

The Commission’s recommendations fed directly into a constitutional change. A bill to give local bodies constitutional status was first introduced in 1989, and after revisions it became the landmark 74th Amendment Act of 1992. This Amendment recognised urban local bodies as a third tier of government, listed their functions in the Twelfth Schedule, and required states to devolve powers and finances to municipalities. In principle, this meant cities would now be governed by elected local institutions rather than run entirely from state capitals. In practice, decentralisation has remained incomplete, with many states slow to hand over real powers and funds.

JNNURM and the rise of reform-linked funding

The defining initiative of this phase was the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), launched on 3 December 2005. It was the largest urban programme the country had ever attempted. The Mission pursued two main goals: accelerating planned development in selected cities and pushing them to implement governance reforms, backed by an investment that ran into more than a lakh crore rupees over its seven-year period.

What made JNNURM distinctive was the principle of reform-linked funding. Cities and states received money only if they carried out a set of mandatory reforms, such as decentralisation in line with the 74th Amendment, repealing the Urban Land Ceiling Act, reforming rent control, and improving municipal accounting. The Mission also folded in earlier schemes; it subsumed the IDSMT and the Accelerated Urban Water Supply Programme under its umbrella, linking the old town-development work to the new reform agenda. A dedicated component for Basic Services to the Urban Poor kept poverty on the agenda alongside infrastructure.

The broader context of this phase was the entry of the private sector. After liberalization in 1991, the five year plans began launching urban programmes structured as ‘missions’ with defined objectives, timelines, and measurable outcomes and private sector participation. Special purpose vehicles, public-private partnerships, and competitive funding became standard tools, a sharp contrast to the state-led model of the 1950s.

What the three phases tell us

Read together, the three phases trace a clear arc. The first phase trusted the state to plan and build through master plans and public institutions. The second phase tried to redistribute growth toward smaller towns and confront poverty, with only partial success. The third phase reimagined the state as an enabler that uses reforms and incentives to draw in private investment and empower local bodies. Each phase responded to the failures of the one before it, yet familiar problems, including big-city bias, weak municipal finances, and incomplete decentralisation, persisted across all of them. Understanding this progression is essential for making sense of the urban missions that followed.

What do you think? If smaller towns kept losing people to metros despite decades of targeted schemes, was the strategy itself flawed, or simply under-resourced? And does linking central funds to reforms, as JNNURM did, genuinely strengthen local governments, or does it shift power away from the very cities it aims to empower?

References

PDF 📄

Phases of Urban Policy and Planning in India: 1951 Onwards

Table of Contents

Why study urban policy in phases? 🔗

First phase (1951-1966): the master plan era 🔗

Rehabilitation after Partition 🔗

Master plans and institution building 🔗

Second phase (1969-1984): balancing the urban hierarchy 🔗

The push for small and medium towns 🔗

Tackling urban poverty 🔗

Third phase (1986 onwards): liberalization and the reform turn 🔗

The National Commission on Urbanisation and the 74th Amendment 🔗

JNNURM and the rise of reform-linked funding 🔗

What the three phases tell us 🔗