Second, the bigger existing package of schemes for rural areas is not as important a factor as could have been expected in favor of rural governance. It is mentioned in Erein, Odisha and in the CTs in Bihar but the perception of trade-off depends on the social composition of the wards. In Erein, the loss of MGNREGS and IAY is seen as having a potential negative impact of becoming urban in the poor wards but this is not the case in wealthier wards. In Bihar, the inefficiency of MGNREGS, which has been stopped in the last six months according to our interviews, neutralizes the weight of public schemes. Rural schemes do not seem to make much of a difference, at least for the local elite.

A third difference, and an important one, between urban and rural governance is the bringing of urban bylaws and planning devices. In our case studies, except in Erein that is located in close proximity to a municipal corporation where urban planning and urban regulation apply, there is no direct reference to the trade-off related to urban norms. Conversely, in the statutory town of Jhanjharpur, the spatial expansion is partly driven by the absence of authorization for construction and cheaper land values in the surrounding villages.

Fourthly, access to better urban services, water, sanitation, solid waste management and drainage can be a major benefit of urban status since additional funds are provided for these. However, the analysis of census data on the growth of services (Table 6) does not necessarily corroborate that argument. The question of basic amenities is the main discussed topic in the governance debate. In Bishnugarh and Cherra, both the sarpanch believe that urban governance would automatically lead to better services and job opportunities, almost as a manifestation of faith that some external driver would change the settlement. This is shared by the residents and the elected members in Gopalpur whose preference is in favor of additional funds for urban services rather than rural public schemes. The Bihar case provides a more conflicting view and brings to the fore a facet of the debate that is not visible in the existing literature. The very low level of services, in Jhanjharpur, according to the fieldwork interviews, acts as a justification for many sarpanch and ward members to reject the idea of becoming urban. If the only advantage of becoming urban is the prospect of better urban amenities that are nowhere to be seen in the district – then this is not an attractive proposition. As the president of the North Behat Panchayat states, “we do not want to join Jhanjharpur Nagar Panchayat because development is better in Gram Panchayat than nagar panchayat”. In other words, the trade-offs between remaining rural or becoming urban are not seen by the actors in a vacuum but are embedded with their understanding of what urban signifies in their regional context.

Finally, the field work conducted in the various sites unveils other issues that are only touched upon very sparsely in the literature. One of these issues is the necessity in many cases of realignment of jurisdictions. Another is the connection of the debate on urban status with its social outcomes and related to social conflicts as well as its impact on local politics and the local power structure.

In Erein the urbanization process has been marked by displacement due to large public sector schemes and increased social disparities between the new “middle class” inhabitants (public sector employees working in the district headquarters of Bhadrak) and its poorest inhabitants concentrated in tribal, Dalit and Muslim neighborhoods. Dalit and Muslims’ wards are deprived of electricity which they access illegally and in these wards the fear of having to pay taxes is combined with a sense of exclusion that would be furthered with urban status. In the tribal wards, 15