News: The Ministry of Housing and Urban Affairs has said that the four-decade-old Census Town criteria no longer adequately capture India’s urbanizationà The criteria used by the Registrar General of India (RGI) have remained unchanged since 1981.

What is a Census Town?

• A settlement that shows urban demographic and economic characteristics but continues to be administratively rural.
• Such settlements remain under Panchayati Raj Institutions rather than Urban Local Bodies.

Criteria

A settlement must satisfy all three conditions:

• Population → At least 5,000 people.
• Non-agricultural work → At least 75% of male main workers engaged in non-agricultural activities.
• Density → At least 400 persons/km².

Why Change is Needed?

• Gender Bias → Only male workers are considered in the non-agricultural criterion, overlooking women’s economic participation.
• Hilly & NE Areas → Uniform population and density thresholds disadvantage dispersed settlements.
• Density Issue → Large revenue-village boundaries can reduce calculated density despite compact urban development.
• Underestimation of Urbanisation → Rural-urban classification may miss peri-urban areas, ribbon development and industrial corridors.

Implications

• Urban Governance Gap → Urbanising settlements remain under Panchayats with limited urban planning capacity.
• Fiscal & Infrastructure Gap → Rural funding may not adequately support sewerage, piped water and public transport.
• Unplanned Growth → Lack of municipal planning can lead to haphazard construction, wetland encroachment and poor waste management.