Page 7 for the next 15 years has been forecast at 2.9 percent<sup>3</sup> , indicating continued high urban population growth in the state for an extended period. As is commonly the case, Ahmedabad, the largest city in the state, has been growing more slowly than the total urban population of the state. It is also important to note that while population growth rates in both the AMC and the urban areas of Gujarat rose in the recent census, they are considerably lower than in the 1970s. These healthy growth rates and the relatively youthful age profile of the population clearly imply that household formation in the AMC—not currently measured at the corporation or urban agglomeration area—are likely to be buoyant and will require a substantial supply response to avoid major real estate price increases. However, rising prices and continuing large shares of the population in slums are not the result of out of control urbanization. Rates of growth are actually declining.

Table II. 1 Population and Urbanization Growth in Ahmedabad 1971-2011

||**1971**|**1981**|**1991**|**2001**|**2011**|
|---|---|---|---|---|---|
|**Population in '000**||||||
|Gujarat State|26,697|34,086|41,310|50,671|_60,384_|
|Gujarat-Urban|7,497|10,601|14,248|18,930|25,713|
|Ahmedabad MC(AMCext from 2001)|1,731|2,396|2,924|4,520|5,571|
|**Average Annual Pop'n Growth Rates**||||||
|Gujarat State||2.47%|1.94%|2.06%|1.77%|
|Gujarat-Urban||3.53%|3.00%|2.88%|3.11%|
|Ahmedabad MC||3.30%|2.01% NA||2.11%|
|**Ratios**||||||
|Gujarat State Urban/Total|28.1%|31.1%|34.5%|37.4%|42.6%|
|Ahmedabad AMC/Gujarat Urban|23.1%|22.6%|20.5%|23.9%|21.7%|

Source: Census of India, various years Note: Growth of AMC population between 1991 and 2001 is not shown due to expansion of AMC area in 2001. Since population is measured on two different areas in the different years, the growth number reflects the jurisdictional shift not population growth.

Incomes are, however, growing rapidly. Per capita net state domestic product has grown at over 8.4 percent per annum in real terms between 2001 and 2010<sup>4</sup> , placing Gujarat amongst the most rapidly growing states in the country. Employment as reported in the Census of 2001 grew by 4 percent a year between 1991 and 2001 in the urban agglomeration of Ahmedabad, as against a population growth of 3 percent<sup>5</sup> . This is typical of the pattern for the state as a whole, with employment in urban areas outpacing both population growth in the cities and the rate of employment growth in the state as a whole. Table II.2 illustrates. Median household expenditure in Ahmedabad as measured by the National Sample Survey, has grown at over 5 percent a year in real terms in the 5 years between 2004/2005 and 2009/2010<sup>6</sup> . Thus, the problems of affordable housing in the AMC are resulting not from a distressed economy and growing poverty. The issue in this city lies elsewhere.

> 3 Report Of The Technical Group On Population Projections Constituted By The national Commission On Population May 2006.Office Of The Registrar General & Census Commissioner, India 2a, Mansingh Road, New Delhi

> 4 RBI website Handbook of Statistics of the Indian Economy. consulted 08/11/11 http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/009T_HBS120911.pdf

> 5 Data from Census 2001 and 1991 Marginal Workers and Main Workers Categories. Such employment data is not available for the AMC itself and only for the Urban Agglomeration (UA).

> 6 Nominal data is converted using the GDP deflator for Gujarat published by the Reserve Bank of India. As is commonly the case with rapid income growth, the mean expenditure is growing more rapidly than the median. The ratio between mean and median in the 2009/10 survey has risen only slightly to 1.22 from 1.20 in the 2004/05 data.