NEW DELHI: The 13th BRICS Urbanisation Forum opened at Sushma Swaraj Bhawan on June 11, with Manohar Lal, Union Minister for Housing and Urban Affairs, leading India’s delegation at the two-day ministerial event. All eleven full member nations Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, Saudi Arabia, the UAE and Indonesia were invited at the ministerial level. Together the BRICS bloc holds 48.5% of the global population. The forum’s theme is “Cities for People: BRICS Cooperation for Inclusive and Resilient Urban Futures.” A joint communiqué is expected by June 12, built around four priorities: inclusive urban development, climate-resilient infrastructure, municipal capacity and digital governance.
India is hosting the BRICS Urbanisation Forum for the fourth time since it placed urbanisation on the bloc’s agenda in 2013. This edition carries more explicit ambition. As 2026 chair, India is positioning its flagship urban missions PM Awas Yojana, AMRUT 2.0, the now-concluded Smart Cities Mission as an adaptable template for the Global South. The trouble is that the template is still being debugged. India’s annual urban infrastructure investment stands at 0.7% of GDP. The World Bank estimates that low- and middle-income countries need between 2% and 4% of GDP in annual urban investment to sustain productive growth. China by comparison has historically directed 2% to 3% of GDP toward municipal public facilities and transit. A country does not typically export a model it has not yet made work at home.
The Scale of the BRICS Urban Financing Crisis
The housing deficit numbers across BRICS are substantial in every direction. India’s gap, assessed by the Anna Roy Joint Committee in May 2025, sits between 50 and 70 million units up sharply from the 18.7 million estimated in 2011, driven by peri-urbanisation and land costs that represent up to 63% of total development cost in major metros. Brazil faces a confirmed deficit of 6.3 million units, with roughly 52 million urban residents living in favelas or inadequate housing. South Africa needs 138,000 new units annually just to stay level with migration demand. Ethiopia’s formal housing supply delivers 165,000 units per year against a need of 486,000.
The financing structure behind this deficit is equally strained. South Africa’s largest metros have functional own-source revenue bases property taxes, utility tariffs and can access commercial debt markets independently. China operates a local government bond market worth RMB 14.7 trillion, though heavy debt accumulation in less-developed provinces has pushed local debt burdens past 40% of provincial GDP. India’s municipal bond market by contrast, has raised a cumulative Rs 4,540 crore from 17 municipal corporations since FY18. That is less than the cost of a single metro rail corridor. The average urban local body in India covers only 51% to 56% of its expenditure from its own sources. Property tax the cornerstone of municipal finance globally, contributes just 0.15% of India’s GDP. In mature subnational economies, that figure exceeds 2%.
India’s Template Has Numbers Behind It and Numbers Against It
The headline figures from India’s urban schemes are not insignificant. Under the combined PM Awas Yojana Urban programme, 125.15 lakh houses have been sanctioned as of March 2026, of which 97.30 lakh have been completed. AMRUT 2.0 has approved projects worth Rs 1.93 lakh crore, with contracts of Rs 1.38 lakh crore formally awarded. The Smart Cities Mission mobilised Rs 1.84 lakh crore in public and private capital across 100 cities before its central funding cycle closed in March 2025.
However a PRS Legislative Research analysis reveals that in FY2025-26, the Ministry of Housing and Urban Affairs spent only 31% of its original PMAY-U budget a 69.4% underspending rate. Between 2017-18 and 2025-26, PMAY-U recorded an average annual underspending rate of 34%. State matching contributions have been chronically delayed. Private developer participation under the affordable housing vertical has remained well below target. Similarly the central government has imposed a hard condition on AMRUT 2.0: at least 50% of committed central share must be physically spent by March 2027 or the mission will not be extended. That deadline is ten months away.
The Finance Gap the Forum Will Not Resolve
The most consequential item on the forum’s implicit agenda is the one least likely to feature in the communiqué. India has launched an Urban Challenge Fund with a Rs 1 lakh crore corpus, designed on a leverage model central assistance of 25% is unlocked only when municipalities attract private capital or bank loans to cover at least 50% of project costs. The logic is sound, Independent analysis indicates that over 80% of the 4,223 smaller urban local bodies being targeted lack the audited financials and credit ratings needed to access commercial debt. The fund exists the municipalities who need it most cannot qualify.
The 16th Finance Commission has recommended Rs 3.56 lakh crore in grants for urban local bodies over 2026-2031, with 20% tied to performance benchmarks including own-source revenue growth. As RBI research notes, without systemic reform of property tax collection and urban zoning, local bodies cannot realistically tap debt markets regardless of what central incentives are offered. Furthermore the New Development Bank the BRICS-backed multilateral lender remains a fraction of the financing scale the bloc’s cities actually require. BRICS nations share a common urban financing problem. They do not yet share a mechanism to solve it. The joint declaration expected tomorrow will call for coordination. What it will not answer is who closes the gap, by how much and on whose balance sheet.
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