Urban policies in India have gone hand in hand with the macro-economic policies. Beginning with extensive State involvement in directing urbanization on one hand and development patterns in the urban centres through master plans on the other, in the recent times, the policy thrust has shifted to extensive reliance on market to direct urbanization and development patterns in the cities. Paradoxically, extensive State involvement considered urban poor as unwanted. With the State withdrawal, the urban policies have come out of the realm of utopia to pragmatism, and urban poor are being considered a part of the urban system. Market-led development is also pushing urban policies into realm of pragmatism. Earlier utopia was on two counts, extensive State involvement and non-recognition of poverty in the cities. The current pragmatism is also on two counts, recognition that the State cannot deliver all and there is poverty in the cities.

The pragmatic agenda has come because of economic compulsions. Further, the urban policies have shifted from excessive centralized thrust to decentralized thrust. These policy changes in the urban areas are taking place under the influence of the international funding agencies. While the ideology and therefore the policies have reversed, the trend of concentrated urbanization in certain regions of the country and concentration of urban poor in smaller towns and cities have continued. Such a paradox has occurred in India’s journey from utopia to pragmatism because of underlying ‘economism’ in the urban policy making in much the same way as macro economic policy. The concern for equity was at best an euphemism State supported capitalistic growth.