Mumbaikars Fume As Delhi Beats Mumbai To Become The Financial Capital Of India On International Maps

Mumbai ranks 31st among 50 top metropolitan economic entities globally in 2015, as per latest data released by Oxford Economics. The unflattering news for Mumbaikars is that the city has ceded its position as economic capital of India to Delhi.

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Oxford Economics is one of the world's foremost independent global advisory firms, providing reports, forecasts and analytical tools on 200 countries, 100 industrial sectors and over 3,000 cities.

As per the latest analysis, the Mumbai extended urban agglomeration (EUA), consisting of Mumbai, Navi Mumbai, Thane, Vasai-Virar, Bhiwandi and Panvel, had a 2015 GDP of US $368 billion when seen in terms of purchasing power parity (PPP), using a 2012 PPP conversion rate of Rs 15.5 per dollar.

Against this, the Delhi EUA, consisting of Delhi NCR, Gurgaon, Faridabad, Noida and Ghaziabad, had a GDP at PPP of $370 billion, taking it to 30th position in the global ranking.

The definition of Mumbai makes it roughly correspond to the Mumbai metropolitan region (MMR), while Delhi EUA is smaller than the National Capital Region (NCR).

The Oxford Economics forecast for 2030 shows that Delhi and Mumbai will move further up the list. While Delhi is predicted to be at the 11th spot, Mumbai will be 14th.

Mumbai EUA, with a lower population, scores over Delhi EUA in per capita terms. A TOI analysis of Oxford Economics figures puts Mumbai's per capita GDP at PPP at $16,881, while the same for Delhi is $15,745.

Prof Bino Paul, Tata Institute of Social Sciences (TISS), said post-liberalisation, Delhi National Capital Region (NCR) seems to have outpaced Mumbai metropolitan in physical infrastructure and social infrastructure.

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"Perhaps, what makes Delhi NCR more buoyant and inspirational than Mumbai may be attributed to massive spatial consolidation and contentedness that have emanated from synchronisation between state and business, in particular in locating industry decisions," he said.

Sangita Kamdar, a professor in economics, confirmed that Delhi had overtaken Mumbai.

"Business is attracted more towards Delhi as they prefer to be closer to the national government for clearances. But more important is the availability of infrastructural facilities which affect the cost of doing business," she said.

Mumbai's high-cost economy is not favourable to business. The high cost of land and skilled labour does not provide the right incentives to attract investmentĄĒdomestic and foreign," she said.

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Kamdar added that GDP per capita was a better indicator of economic performance, and here Mumbai leads Delhi, indicating better markets and purchasing power.

Paul observed that while Mumbai retains the charm of an open dynamic urban space, owing to preferential decision-making on investment, Delhi appears to have been surging ahead of Mumbai.

"Unless Mumbai, as a space, sees society, state and business creatively collaborating to create a massive leapfrogging in physical infrastructure such as integrated transport and social infrastructure such as socialisation spaces and universities to meet the expectation of burgeoning youth, the divide between growing Delhi NCR and slowly growing or stagnant Mumbai will widen unabated," he said.

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Maharashtra chief minister Devendra Fadnavis rejected the notion that Delhi's GDP has gone ahead of Mumbai. "I want to challenge these figures. From figures of the Reserve Bank of India, Economic Survey of India and Maharashtra, it is evident that Mumbai is ahead in terms of GDP and financial status. The MMR GDP is higher," he said.

Pankaj Kapoor, managing director, Liases Foras, a real estate research agency, said the comparison was unfair to Mumbai as there is no parity of geographical area. "The Delhi entity considered is nearly three times the corresponding Mumbai entity in the area. If one simply looks at the economic concentration in a given area, it is higher for Mumbai. But it is also true that Mumbai's inefficiency in terms of infrastructure and real estate cost is driving business away. This should serve as a wake-up call," he said.

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Fadnavis said his government was framing policies to unlock land so that it becomes affordable. Also, infrastructure projects such as the Mumbai trans-harbour link would open up the hinterland. The government, he said, had worked towards creating a conducive atmosphere for attracting investments to the state.