Economic Survey 2026: India’s future cities must make life easier, not just bigger

India's Economic Survey 2025–26 has some suggestions about how India's future cities should look like and how your lives will get comfortable, while Asia's third largest economy stands at a pivotal moment in its urbanisation journey.

Indian cities should be designed to save time, encourage creativity and make everyday life easier—not merely to move traffic or manage population growth—according to the survey, which lays out a forward-looking blueprint for how urban India must evolve to remain economically competitive and liveable.

Also Read: Economic Survey 2026: India to see higher inflation as weaker rupee poses risk, soft commodities offer relief

India’s Cities, Reimagined

Cities, the survey argues, should no longer be seen merely as places where people live, but as critical economic infrastructure that shapes how growth is created, distributed and sustained.

Urban India is already doing the heavy lifting. A majority of national output is generated in cities and urban regions, and by the next decade, towns and cities are expected to house around 60 crore people while contributing close to 70% of GDP, in accordance to estimates by the World Bank.

Electoral, fiscal, and administrative responsibilities in cities remain distributed across multiple tiers of government, the survey mentioned.

The Survey argues that while governance reforms, financial devolution and infrastructure investment remain essential, they are no longer sufficient on their own. As cities grow in scale and economic importance, urban design must shift from a survival-oriented model to one that prioritises productivity, dignity and quality of life.

Time is the New Urban Currency

A central idea in the Survey’s urban vision is treating time as the most valuable urban resource. The most liveable global cities systematically minimise time lost to commuting, accessing services and dealing with uncertainty. Future neighbourhood planning in India, the Survey says, should ensure that housing, schools, health centres, anganwadis and workplaces are located within short and predictable travel distances, reducing daily stress and improving economic efficiency.

The Survey also calls for a fundamental rethink of streets. Rather than functioning only as traffic corridors, streets should be designed as social infrastructure that prioritises safety, accessibility and interaction. Drawing on global examples such as Barcelona’s “superblocks” and Melbourne’s laneways, it argues for shifting from road-widening to street-making. Between 10% and 15% of city streets, particularly in dense residential and commercial areas, should be pedestrian-first or low-traffic, with features such as shade, seating, safe crossings and space for vendors built into design norms.

India’s Cities Are Creative—Policy Isn’t

Beyond mobility, the Survey stresses the importance of creative density, alongside economic density. Globally engaging cities actively nurture art, music, food and street culture as part of urban policy. Indian cities, despite their cultural depth, often constrain creativity through restrictive licensing, blunt noise regulations and lack of affordable inner-city spaces. The Survey calls for low-rent creative zones in city cores, using public or underutilised land, supported by single-window approvals for studios, theatres, rehearsal spaces and galleries.

On informality, the Survey argues against eviction-led urban development. Instead, it favours in-situ upgrading of informal settlements, with secure tenure, basic services and gradual formalisation. Streets, it adds, should be explicitly designed to accommodate vendors, building on the Street Vendors Act, 2014 and schemes such as PM SVANidhi that have helped formalise vending zones in several states.

From Compilance to Participation

Governance reform is another pillar of the proposed shift. The Survey calls for moving from procedural, top-down urban administration to participatory governance, where citizens are involved in decision-making through neighbourhood councils, participatory budgeting and transparent planning processes. Making planning documents and zoning changes publicly accessible by default, it argues, would strengthen accountability and civic ownership.

There is also a psychological dimension to the Survey’s urban vision. Cities that succeed globally, with the Survey pointing to New York City and Amsterdam, are those that signal opportunity, diversity and reinvention. Indian cities, by contrast, are often aspirational but exhausting, demanding resilience rather than rewarding curiosity. To attract and retain skilled workers and entrepreneurs, the Survey says cities must offer dignity, predictability and space for expression, not just higher wages.

The broader conclusion is clear: India is already far more urban in economic and functional terms than official classifications suggest, yet its cities remain underpowered institutionally and fiscally.