Author: cprindia

In March 2024, my colleagues Shubham Kashyap, Aena Rawal and I were on the road to Dhampur again to resume the field work for our study: Forty Years’ Development Saga of Dhampur: Growth Dynamics and Regional Transformation of an Indian Small Town. While I was busy introspecting about how we will go about our work in Dhampur, I was also noticing everything passing by, the towns and villages, factories, and green fields lush with sugar cane, wheat and mustard crops. Also, the towns and villages we passed through had the string of familiar roadside shops and services that straddle between rural and urban life styles, ranging from fancy clothes and shoe stores, fruit and vegetable stalls, chemists, mobile phone repairs, barbers and beauty salons, construction materials, furniture, household goods, agricultural implements, sweet shops, tea shops, biryani joints, and restaurants also displaying pictures of fast food (burgers, momos and noodles) along with the usual Indian dishes on their boards. 

As we approached Gajraula town, I started noticing a few pizza places. When looked closely I found that none of these were popular pizza brands I was familiar with, such as: Domino’s, Pizza Express, Pizza Hut, La Pino’s, US Pizza, Chicago Pizza, Papa John’s, Oven Story and Slice of Italy. There were names like Pizza Slice, Pizza Nagari, ONO Pizza, Roms Pizza, etc. Going around in Dhampur town, we came across several more such as: Biggies Pizza, Pizza Uncle, Pizza Point, Pizza Universe, Friends’ Zone Pizza, Hunger Pizza, Delicious Pizza and Shambhu Pizza.

We preferred to have lunch in a restaurant while being out and about the town as we always had dinner at the Eurasia Palace hotel where we were staying. The numerous street food carts selling popular foods like Parathas, Biryani, Chhole Bhature, Momos and Burgers didn’t appeal to us. There were only two multi-cuisine restaurants in the town that could meet our expectation of hygiene, ambience and choice of dishes, namely the Indian Corner and Gulmohar. Hence, we often ended up in one of the pizza places for a change. To our surprise, we found that the pizza toppings were very similar to what we would find in pizzerias in Delhi and other large cities, and not drastically customised to suit more Indian small-town palate. Some of the larger pizza places also had home delivery services, such as Biggies Pizza, Pizza Uncle and The PizzaBite. The only difference was that none of these restaurants offered thin crust pizzas. However, the price of pizzas was about half the price of what one would pay in well-known pizza joints like Dominos in larger cities, which is understandable keeping in mind the local affordability levels.

Remembering my student days, when going out to eat always meant going to an Chinese restaurant, I wondered what would explain the penetration of pizzas into the Indian small towns and the countryside, as the only international cuisine that is so visible?

After trying out several pizza places and talking to some of the restaurant owners, I came to understand that there are a number of explanatory factors for the popularity of pizza places in a small town like Dhampur:

Pizza Joints Have Not Replaced the Conventional Food Outlets: As is the case in many smaller towns and cities in India, sweet shops also offering a range of savory delicacies continue to be the go-to places for take-aways in Dhampur as well. Khairati’s sweet shop located in Bhagat Singh Chauk is about two hundred years’ old and is the most popular of such sweet shops. Bhagat Singh Chauk in the center of the town also has many snack vendors, where people stop to take a bite while shopping in the market, or just go there for a quick snack. The most well-known of these is about hundred years’ old Jain Kachari Wala who specialises in selling Singhada (Water Chestnut), Lobia Beans and Moong dal Kachari (A slow cooked creamy paste) served with a chunk of butter, green chutney and sweet chutney. Virendra Saini, the third-generation owner of this business, opens this shop at 6 am and closes by mid-day. Food carts continue to serve this dish along with other snacks like Chaat, Samosa, Kachori and Aloo Tiki through the day. In addition, there are several well-known Samosa, Pakora and Kachori shops in the main bazaar street and at key points such as: near the railway station, bus terminal and Nagina Chauraha. But none of these joints offer dine-in facility for a relaxed eating out experience.

Increased Disposable Income: With economic development and more disposal incomes in hand, particularly in India’s urban areas, and also in the neighbouring rural areas, eating out has become the most prominent life style changes. Newer and more eating out options are coming to meet the preferences of the clientele of different income groups.

Impact of Internet and Media: The media and advertising have an undeniable role in promoting various kinds of cuisines that prominent social influencers in large cities prefer to eat. Easy access to internet and platforms like YouTube also makes it possible for young people in small towns and villages to learn more about these new kinds of cuisines.

Changing Aspirations of the Youth: Pizzas appear to be the new exotic food in India’s small towns. Pizza joints meet the aspirations of the younger generation, who think it is fashionable to eat in a fancy restaurant where they can chill out with friends and take pictures. These restaurants also provide a safe space to young men and women who can spend time together without social scrutiny.

Similarities Between Pizzas and Roti-Sabzi: Easy acceptance of its structure and taste, as in a way it is similar to the most widespread North Indian staple Roti-Sabzi, albeit with a bit of tomato sauce and cheese. And, you can make it spicier to match your taste by adding jalapeno toping and chili flakes. Pragmatism of eating it with hands with no fear of being frowned upon for not using unfamiliar cutlery like fork and knife has an additional appeal.

Finally, one can say that popularity of pizzas is one of the indicators of the widespread life style transformation taking place in an aspirational small town like Dhampur.

Note: All pictures are taken by Pushpa Pathak

Source: Author analysis of data from EIDB->SYSTEM ON INDIA’s Export Import, Ministry of Commerce https://tradestat.commerce.gov.in/ 2025-26 refers to the first quarter of the fiscal year, i.e., April 2025 to June 2025
Note that “Traditional West Asia” refers to three large sources, viz. Iraq, Saudi Arabia, and UAE. Other Traditional includes USA, Brazil, Kuwait, Mexico, Nigeria and Oman. Together with Russia, they were the top ten sources in 2021-22, before the spurt in crude imports from Russia. Rest comprises other 31 countries from which there were imports under HSN code 27090000 for 2018-19 to 2021-22 and HSN 27090020 for 2022-23 to 2025-26.

Figure 1 shows how the source countries of India’s imports of petroleum crude has changed since 2018-19, with the rise in the share of Russia from 1% in 2018-19 to 35.1% (by value) in 2024-25 (35.8% by volume). However, over this period, there have actually been two transitions. 

The first transition, over 2018-19 to 2021-22 (admittedly, a CoVID-affected year), was when India stopped importing from first, Iran and then Venezuela. Their share of 17% in 2018-19, about 41 million tons out of a total of 226 million tons, was largely made up by stepping up the share from traditional sources. 

The second transition is the increase in imports from Russia, which goes from 4 million tons in 2021-22 to over 87 million tons in 2024-25. In this shift, the share of Iraq, Saudi Arabia and UAE reduced by 11 percentage points, but since the overall import went from 196 million tons to 244 million tons, their overall quantity remained about the same. However, for the other six countries, not only did their share drop by 18 percentage points, the quantity imported from them reduced by more than half, from over 60 million tons to under 30 million tons. The shares of other countries (‘Rest’) also declined, as did overall imports from them. However, imports from some countries, like Angola and South Korea, show an increase over 2021-22 to 2024-24. Some imports from Venezuela also seem to have resumed. Thus, the increase in imports from Russia has been accompanied by a decrease in imports from many countries, some of whom saw a drastic fall in their exports to India.

Figure 2 compares average unit values (total imports by value divided by imports by volume) of imports from Russia and other countries. Before 2021-22 (this Russia Ukraine war started in February 2022), Russian crude was priced at a premium, while post 2021-22, it was indeed priced at a discount. The discount was substantial in the two years, 2022-23 (14.1%) and 2023-24 (10.4%). This implies savings in the total crude import bill of about USD 5 billion a year or 3.1% and 3.9% respectively, given the counterfactual that Russian crude was substituted with crude at the average non-Russian price. However, if India were to shift to other suppliers, given its import volume, the global price might actually have risen, i.e. this is the claim that US wanted India to buy Russian crude to keep the oil market stable and prices in check. So, the value of savings may have been higher, but it would have been likely be under 1% of the total Indian import bill.

While chairing the 10th Governing Council Meeting of NITI Aayog on 24th May 2025, PM Narendra Modi observed that: ‘India is urbanising rapidly.’ He asked the states to make cities the engine of sustainability and growth, and urged them to focus on Tier 2 and Tier 3 cities. He noted that a Rs 1 lakh crore Urban Challenge Fund (UCF) is being created for seed money.

In the budget 2025-26, an annual allocation of Rs. 10,000 crores is made for UCF to implement project proposals for `Cities as Growth Hubs’, `Creative Re-development of Cities’ and `Water and Sanitation.’ The Centre will finance up to 25% of the cost of bankable projects provided at least 50% of the cost is funded from bonds, bank loans, and PPPs. 

In 2002-03, the government had proposed to set up a similar City Challenge Fund (CCF) to provide incentivised partial public financing for urban infrastructure development. However, no financial allocation was made specifically for setting up CCF. A total of Rs. 24.68 crores were set aside for a wide range of Other Urban Development Schemes, including CCF. This allocation was increased to Rs. 50 lakhs for the financial years 2003-04 and 2004-05. However, no city had accessed CCF, perhaps because the size of the fund was too small and the stipulation of designing and implementing associated city-level reforms was too demanding.  

The rationale behind setting up UCF, with a much larger allocation of funds, is the realisation that the limited public finance must be leveraged to raise funds from the market for improving urban infrastructure and services. This is because municipal revenues have not increased significantly in most cities, but have remained stagnant on an average at about 1 per cent share of GDP between 2007-08 and 2017-18 as reported in the 15th Finance Commission Report.

At Rs. 10,000 crores per year, the size of the UCF kitty is definitely huge in comparison. But the question is: Are Indian cities, particularly in Tier 2 and 3 categories, better equipped to access partial funding from UCF while raising the remaining resources from the market two decades later?

The current scenario is more positive for possible successful implementation of UCF. First, though only 16 cities have opted to raise funds through municipal bonds, a significantly larger number of cities have some experience of PPP arrangements for infrastructure development. Second, all projects eligible under the three categories for UCF funding have some revenue generation potential. However, many Tier 2 and Tier 3 cities may not have the capacity to design large infrastructure projects with complex funding arrangement including bonds, bank loans, and PPPs to qualify for UCF support.  Hence, the central government should make the following policy changes to enable Tier 2 and Tier 3 cities to access UCF funds in the next five years:

First, increase the government incentive from the proposed 50 per cent to 60 per cent, with 30 per cent being central grant and matching 30 per cent coming from the state governments, and to reduce market borrowings and PPPs to at least 40 percent. This will also be in line with the current government practice as is followed by the Ministry of Finance for implementing the Viability Gap Funding scheme for supporting infrastructure projects undertaken through PPPs with the similar objective of making them commercially viable.

Second, synchronise UCF funding with other ongoing government schemes to optimise their outcomes, in particular: Commerce Ministry supported formulation of ‘City Level Economic Vision for 100 Tier 2 and 3 Cities’ by June 2026, as a part of nationwide reforms to create manufacturing hubs in 1,039 cities; and Niti Aayog’s Growth Hubs Initiative currently covering 4 cities that is to be scaled up to 16 cities. This would help states and cities to identify a few low hanging bankable urban infrastructure projects suitable to get funding from UCF with relative ease and speed.

Third, as the central government is interested in broad-basing its support to tier 2 and Tier 3 cities, and these cities may require technical support for preparation of bankable projects, some allocation should be made for financing it while formulating the operational design of UCF. 

To conclude, supporting Tier 2 and Tier 3 cities will help in fulfilling the country’s aspiration of becoming Viksit Bharat by 2047 as well as in meeting the objective of realizing a more spatially dispersed and equable urban growth pattern in India.

Figure 1: Price Indices of New and Second-Hand Buildings in Chinese Cities 

(Jan-May 2024 = 100)

Source: National Bureau of Statistics of China Sales Prices of Commercial Residential Buildings in 70 Medium and Large-sized Cities: https://www.stats.gov.cn/english/PressRelease/202506/t20250616_1960179.html

Last week, the National Bureau of Statistics of China (NBS) released data on real estate prices. Of the seventy cities for which the NBS collects data, in all except two, viz. Shanghai, the second-richest city, and Taiyuan, the capital of Shanxi province and among the poorer cities in China, the price of newly constructed buildings is lower in the first half of this year compared to the same period in the last year. Furthermore, the price of second-hand buildings is lower in all the cities, even Shanghai and Taiyuan and in all but five, of which Beijing is one exception, where prices of new buildings have fallen by more than that of older buildings, the price of second hand buildings has fallen by more than for new buildings. All this does not point to a stabilizing real estate market. It is also true that the overall price index for China has not grown either — the national consumer price index (CPI) decreased by 0.1%, year on year, with the rural CPI falling by 0.4%, but that is cold comfort.

In the least affected quintile, i.e., the 14 cities with the least fall in prices, the average fall was 1.6%, while in the most affected quintile, the 14 cities with the highest fall in prices, the average fall was 7.3% and these include important economic cities like Wenzhou, Guangzhou, Fuzhou and Tangshan. Indeed, based on a sub-sample of 35 of these cities for which city GDP data is easily available, there is little relationship with the economic well-being of the city. 

Given the current global economic and political uncertainty, which is also reflected in China’s own growth, it is natural that homebuyers are cautious. Further, the fall in prices may lead them to wait and see if the prices will come down even more. It looks like the malaise that started with the fall of firms like Evergrande and Country Garden may continue for some time.

By contrast, in India, based on the RESIDEX index released by the National Housing Bank (https://residex.nhbonline.org.in/) for 50 cities, the top quintile, i.e., the ten cities with the highest increase in prices, saw an average rise of 22.8%, though the bottom ten saw almost no increase, with two, Thiruvananthapuram and Haora, registering a decline. The other three quintiles saw a rise of 4.9% to 10.3% over last year, very different from the Chinese picture.

All through 2024, we have been doing extensive field-based research for the study titled “Forty Years’ Development Saga of Dhampur: Growth Dynamics and Regional Transformation Potential of an Indian Small Town.” This small town has gone through major transformations in several spheres over the four decades. One such area of change is abundant provision of medical services.

At the time of earlier study, Pushpa Pathak had observed that there were just a few doctors’ clinics. Even in the recent past, there were only 3 or 4 well known doctors practicing in Dhampur such as: Dr. Bagchi, Dr. Parikh, Dr. Lalin Khan and one Homeopathic doctor popularly known as Dr. Chawanni as he charged only 4 Annas for a consultation.

Currently, Dhampur is a small town of about 1 lakh population located in district Bijnor, Uttar Pradesh. Public health infrastructure in Dhampur includes a Primary Health Centre (PHC), Community Health Centre (CHC) and a 100 bed hospital that is not fully functional, However, these government centres provide limited medical services. At present 200-300 patients visit the Outpatient department (OPD) and 1-2 patients visit Inpatient Department (IPD) in CHC every day, but it has only one doctor and four beds, which is far lower than the norms for CHC. According to the Indian Public Health Standards (IPHS) Guidelines, a CHC should have 30 beds and 7 doctors specialising in Medicine, Obstetrics and Gynaecology, Surgery, Paediatrics, Dental Care and AYUSH. 

The first striking feature pertaining to medical services is the surprisingly large number of private hospitals and clinics for a small town like Dhampur. Another striking fact is that most of the medical facilities are located along both sides of the Kalagarh Road, an east-west state highway in the Northern part of the town. The total number of private hospitals and clinics in Dhampur is around fifty, including Dental Care, of which 37 are located on the Kalagarh Road alone and rest of them are located in other parts of the town. In addition, there are 2 Homeopathic clinics and 16 diagnostic centres located in various parts of the town. 

All the private hospitals together in Dhampur have around 500 beds and 40 to 45 doctors catering to a very large number of patients. For example, 50 OPD and 5 to 7 IPD patients visit Damyanti Devi Nursing Home every day. It has 25 beds and 3 doctors. Durga City Hospital has 50 beds and 3 doctors and gets 20 to 25 OPD and 2 to 3 IPD patients daily. Clearly the ratio of doctors and beds to the number of patients in private hospitals is far better than in the government CHC. 

These facts obviously made us ask: Why are there so many private hospitals and clinics in Dhampur? Why are most of them clustered along a single road one after the other? Following are some of the explanations for these two questions: 

First, India has a large healthcare infrastructure dominated by the private sector, which is very common all over India. This is basically because most public health sector entities have limited facilities which are often of lower quality.

Second, there has been a tremendous surge in private hospitals due to the massive increase in the number of medical colleges and graduates. According to Dr. Kamaal Ahmad, there were only 9 medical colleges in Uttar Pradesh and around 1,000 doctors in 1981. Now there are about ten times more medical colleges and nearly 15,000 doctors.

Third, many of the doctors in Dhampur have rural roots. But, most of the doctors are educated in urban areas and are used to urban lifestyles. Hence, they prefer to practice in towns and cities.

Fourth, Dhampur is well connected with the national and state highways. The neighbouring 3 towns and 500-600 villages are completely dependent on Dhampur for most of the services including healthcare facilities. According to Dr. Aditya Agarwal, Nagina town, where he practiced earlier, is less accessible with weaker connectivity, less developed and has lower footfall in comparison to Dhampur.

Fifth, although most of the doctors have a business mindset, they are also involved in social service such as: campaigns to promote health, provide free consultation, medicine and 1/4th price of the required test for those who cannot afford it, as is done by both Dr. Ahmad and Dr. Agarwal. 

Sixth, Kalagarh Road acts as a central axis that ensures maximum visibility and easy accessibility for patients. Moreover, the clustering of private hospitals on Kalagarh Road suggests that in a competitive market, similar service providers tend to cluster in the same location to maximize access to customers and reduce risk as explained by the Hotelling Location Model (Harold Hotelling, 1929).

To sum up, a large number of private hospitals have come up in Dhampur clearly in response to the demand from the town and nearby villages. But the way they are established on Kalagarh Road, shows that competition might be shaping the choice of location of healthcare facilities.

Figure A: Estimated Share of Gross Domestic Product for ‘City-Regions’ (2022-23)

Figure A shows the relationship of the share of ‘city-region’ in the gross domestic product (GDP) with its population share. Kolkata is an outlier, as the only ‘city-region’ whose share in GDP is less than its share in population. For the ten ‘city-regions’, the aggregate share of ‘city-region’ domestic product in GDP was 21.1%, which is more than double that of its population share in 2011, which was 9.6%, reflecting the higher per capita domestic product, compared to the national average, associated with these large ‘city-regions’. Note that this is not all urban, as the ‘city-region’ as defined here, includes both urban and rural populations. 

But, unlike China, India does not estimate economic activity at the city level, except Delhi, which is a state-level entity, so, its gross state domestic product (GSDP) is available along with all other states. So, how was this ‘city-region’ domestic product generated? In this situation, the following simple but crude exercise was conducted.

There has been some effort to generate district domestic product estimates (DDP) but these vary widely by state, with some states providing recent updated estimates and others that have not provided estimates for over a decade. The top ten cities by population in 2011 were considered. Each of these ‘city-regions’ were associated with a district or set of districts (for Bengaluru, Chennai, Hyderabad and Kolkata). The Appendix gives the details of the districts that each ‘city-region’ were associated with. For each of these districts (except Jaipur, for which the estimate was directly available), the 2022-23 DDP estimate was calculated in the following manner. For each district, the share of DDP to the state’s GSDP was calculated for the latest two years for which data was available (except the years 2020-21 and 2021-22, which were excluded due to the pandemic). The average share of these two years was then multiplied into the state’s GSDP for 2022-23 to generate the estimated DDP for 2022-23. For ‘city regions’ associated with only one district, the DDP is considered the domestic product for the ‘city-region’ and for ‘city regions’ associated with a set of districts, the sum of the DDP for those districts were taken as the estimate. The specific calculations are given in Appendix A.

Appendix A

 

ADDENDUM

Figure B: Estimated Share of Gross Domestic Product for ‘City-Regions’ (2022-23)

After the blog was put out on Thursday, I received feedback that it did not reflect the spatial spread of the metropolitan region boundaries for many cities. As mentioned earlier, this is a crude estimate, both in defining the city region and its share of GDP. Nevertheless, some adjustments have been made, viz. to Mumbai (including Thane and Raigad) and Kolkata (including Haora and Hugli) on the western bank of the Hooghly river and Bengaluru (including Ramanagara and excluding Tumakuru, which has its own urban development authority and is a smart city in its own right!). Other possible adjustments, e.g. in Hyderabad and Chennai, have not been made. Surat ‘city region’ is Surat district, not the five districts in the report of NITI Aayog. It is also clarified that the Pune ‘city-region’, i.e., district, includes both the Pune and Pimpri-Chinchwad municipal corporations.

A revised Figure B and Appendix B is provided. As can be seen, the broad pattern remains similar. For the ten ‘city-regions’, the aggregate share of ‘city-region’ domestic product in GDP was 23.9%, which is more than double that of its population share in 2011, which was 11.4%. For four cities (excluding Delhi), the share of the ‘city-region’ in the GSDP is quite high, almost at 40% or more for Hyderabad (47%), Kolkata (41%) and Bengaluru (40%) and fairly close for Mumbai (37%). All these cities are capitals of their states. Indeed, the Mumbai-Pune agglomeration accounts for almost half the GSDP of Maharashtra, among our most developed states. The other two capitals, Chennai and Ahmedabad, account for a quarter of their state GSDP and Jaipur, just under one-seventh. Surat and Pune are the only two non-capital cities.

Appendix B

 

For over half a century, the Centre for Policy Research has been at the heart of some of the most significant policy discourses in India.

From the Archives is an attempt to tell CPR’s history from its archival records and trace its journey. The series revisits CPR’s research initiatives, publications, and interactions with national and global policymakers that have helped it mount the challenge of inclusive, actionable change.

CPR During 1984 – 88

The years 1984-88 were marked by crucial turning points in India’s polity and the world at large. Northern India was engulfed in a series of anti-Sikh riots following Indira Gandhi’s assassination, and an agrarian crisis riddled the countryside. As for geopolitics, a protracted Cold War necessitated an ever-evolving foreign policy for a Non-Aligned country like India. Diplomatic ties with NAM nations — famously recovering from the ravages of colonialism — were crucial in this period.

During this time, CPR continued to develop research on the projects it had initiated in preceding years and introduced new areas of study in keeping with the times. The Centre pursued uninterrupted research on the themes of industrialisation, national integration and regional cooperation in South Asia, and contributed to topical discourses of national importance with renewed energy. This research was communicated to the public through seminars, workshops, books, academic papers, surveys and newspaper articles.

Geopolitics

 

The Centre approached relationships between South Asian countries vis-à-vis the Superpowers in a manner that would protect the sovereignty and collective interests of India and its regional neighbours. To this end, CPR collaborated with the International Development Research Centre, Canada on a five-year-long research project. CPR also organised a SAARC-ASEAN cooperation workshop in New Delhi in 1987.

 

Banking and Economy

The State Bank of India instituted a Chair in International Banking and Economy at the Centre in 1984. The Chair grappled with crucial economic questions regarding the proposed establishment of Mumbai as an International Financial Centre, overseas operations of Indian banks and India’s foreign commercial borrowings. The studies aimed to identify avenues for enhancing economic cooperation and trade potential within South Asia and between India and Southwest Asia or the Persian Gulf.

 

Society and Politics

 

The Centre also conducted studies on sociological issues in India. The research on violence, with emphasis on communal violence and riots, examined the socio-economic and institutional factors behind violence and suggested policy changes to mitigate and avoid violent upheavals in India. Studies on reservation policies in the country were introduced during this time. The  research looked at the impact of reservations on the lives of Dalits and Adivasis (SCs/STs) and OBC communities, as well as the politics of anti-reservation movements in the country.

 

Food Security and Health

Two allied research areas, food security and health and nutrition policy, were also advanced. These studies remain relevant today. Research on food security looked at the endemic problems of rural poverty, unemployment, and sluggish growth in the agricultural sector, largely addressing the question of availability. Research on health policy dealt with qualitative and quantitative aspects of implementation to address the question of access.

 

Other Engagements

Senior Fellow Mr. B.G. Verghese led the Ganga-Brahmaputra-Barak Basin Project at the Centre, researching transboundary river water management and conflict resolution in the basin. CPR also continued its engagement with the themes of federalism and problems of governance in India.

Founder-Director Dr. V. A. Pai Panandikar led a survey on public administration supported by the Indian Council of Social Science Research (ICSSR) covering the period from 1979 to 1988.

This is the second edition in this series. Stay tuned for more!