Experts and the media persist in referring to the explosive growth of cities in this country, with hordes of unwanted migrants pouring into them every day. The truth is somewhat different. India's urban growth, by international standards, is not very great compared to Latin American and some African cities. What is more, as the National Commission on Urbanisation, headed by eminent Mumbai architect Charles Correa, observed in its report in 1988, unlike our Asia neighbours, which have "primate cities" like Dhaka, Colombo and Kathmandu, India's cities are fairly evenly spread, with a number of towns to absorb some of the spillover from the countryside.

In 2007, the International Institute for Environment and Development in London released a report titled The Transition to a Predominantly Urban World, which listed just 11 Indian cities out of the 100 with the most rapidly growing in population in the world; among big cities, only Delhi, Hyderabad and Bangalore figured.

Mumbai is a classic case in point. Even urban researchers, not to mention politicians and the public, conflate the population of Greater Mumbai - the city's municipal limits - with the very much larger metropolitan region. This region includes areas of the twin city of Navi Mumbai across the harbour, outlying townships (some now cities in their own right), and villages, comprising 4,355 sq km. The city proper is only 466 sq km and its population is variously described as being 15 to 16 million, while the metropolitan region is around 18 million. This urban agglomeration is estimated to grow into one of the biggest in the world in 2020, with nearly 29 million people.

Before the 2001 census figures came out, even demographers from the Mumbai-based International Institute of Population Studies (IIPS) estimated that Greater Mumbai would have between 14.5 and 15 million inhabitants by 2011, as against 11.9 million a decade earlier in 2001. However, the census now authoritatively puts the city's population at only 12.4 million. It was during the recent Greater Mumbai municipal elections that the confusion was compounded, with the State Election Committee asserting that there were 10.3 million voters. This would amount to this many being over 18 years old and only 2.1 million Mumbaikars who are below the voting age, which is plainly impossible.

The IIPS estimates that a full quarter of the total population is under 14 and this would mean that the number under 18 would evidently be higher. There is obviously an over-estimation by the poll administration about the size of the electorate. Incidentally, this would mean that the low turnout of around 46 per cent in the municipal election would need to be revised upwards.

What is happening in Mumbai is nothing short of a structural transformation. Contrary to everybody's expectation, the city's population has only increased by half a million between 2001 and 2011. There has been an absolute decline in the island city, the oldest part, which straddles 100 sq km. This is the area south of Sion on the east of the Greater Mumbai peninsula and south of Bandra on the west.

According to the IIPS, the widening of roads - and the virtual decimation of pavements in certain crowded areas to accommodate more parking for cars - combined with the drives by the municipal corporation and police against new slums have contributed to the deceleration of population growth in what used to be the industrial capital of the country and continues to be the nation's financial nerve centre. Demographers cite a station on the Central Railway like Govandi which is now open on both sides, with slum dwellers being evicted or resettled. A similar pattern has been discerned at Mankhurd station on the Harbour Line. There has also been a slew of huge infrastructure projects, like the Metro, which have displaced squatters.

The new central business district (CBD) of Parel-Lalbaug in central Mumbai has converted what used to be predominantly mills and mill workers' tenements, known as chawls, into high-rise glass and concrete office buildings and some high-end multi-storeyed housing estates, driving the old residents to cheaper accommodation northwards. Similarly, the Bandra-Kurla complex is the newest district, which has come up on mangroves, and has transformed the pattern of employment and transport. Near this complex, the redevelopment of Dharavi, said to be Asia's largest slum, has been put on hold for a variety of reasons, including the current reluctance of global investors.

While real estate development appears to be never-ending, what is not so visible is its slowing down.

 •  Moving in, staying out
 •  Pie in the planning sky

While real estate development appears to be never-ending, what is not so visible is its slowing down, which is presumably true of other big cities like Delhi, Hyderabad and Bangalore. According to industry sources, interest rates for loans have risen and the global recession has taken its toll as well. In 2011, seven cities in the country, including Mumbai, witnessed a demand for 35 million sq ft of office space. This year, this is expected to dip to 30 million sq ft. Although this is still better than the rapid downturn in 2009, the future is by no means certain.

A recent report on Mumbai by property consultants CB Richard Ellis showed that in 2011, occupancy rates and rentals for commercial real estate remained low in such prime areas as Nariman Point (till a few years ago, the city's sole CBD), Parel-Lalbaug, Bandra-Kurla Complex and the outlying township of Thane. This has put many projects on hold. When these properties come into the market this year, it will only further worsen rentals and increase vacancy levels.

Another real estate consultancy, Jones Lang Lasalle, has surveyed the supply of new residential property in seven cities. Between October and December last year, Mumbai accounted for only 15 per cent of the new "launches" in these cities. In the same quarter in 2010, they were 27 per cent of the total, almost twice as much.

The other urban areas were the National Capital Region (NCR) with Delhi as its hub, Pune, Bangalore, Chennai, Hyderabad and Kolkata. While Mumbai faced a decline in new residential property coming into the market, Gurgaon and Noida saw a massive increase in supply, amounting to half the country's total. Another Mumbai trend, which is probably mirrored elsewhere, is that most newly built apartments are super-deluxe, with few one-bedroom flats. This, inspite of the recent estimate by the Housing and Urban Poverty Alleviation Ministry that there is a shortfall of nearly 27 million homes in the country's urban areas.

The latest confirmation of a Mumbai pattern comes from a report titled "Office Space Across the World 2012" by yet another foreign consultancy based in India, Cushman and Wakefield. Nariman Point, which figured eighth in the world in 2010, has dropped to 15th place a year later. The index was the average rental a month, which decreased from Rs 300 per sq ft per month in 2010 to Rs 275 last year. This puts it on par with Bandra-Kurla in 2011, which rose from Rs 260 per sq ft in 2010. This gives a good idea of the tectonic shift in business activity northwards in the city.

The city with the highest rentals globally in December last year remains Hong Kong with US $244 per sq ft per year, followed by London, Tokyo and, surprisingly, Moscow. Midtown New York figured only sixth, with $120 per year, while Nariman Point - still described as "Mumbai CBD" - dropped 8 per cent to $73 a year.

The ten most expensive locations in India in December were headed by Bandra-Kurla and Nariman Point, followed by Worli in midtown Mumbai. Four of these topmost areas were in the NCR, with Kolkata's Park and Camac streets figuring ninth. Lower Parel, the heart of the former cotton mill district, ranked fifth and Andheri-Kurla in the north of Mumbai, tenth.

According to Cushman & Wakefield, Nariman Point declined due to its high rentals, as also the ageing construction and growing commuting distances from the northern suburbs. The newer areas cited in the ten most expensive ranking provide newer and better office space, as well as shorter commuting time.

It would be fair to speculate that the trends in Mumbai would be replicated in other cities, even allowing for its distinctive geography. With a north-south axis for commuters, who comprise almost half the total population if students are included, these rank among the largest absolute number of daily passengers in the world. Mumbai is paying the price for its past prosperity, but employment is fast shrinking. Demographers believe that three-quarters of the jobs in the city are in the so-called informal sector, with no permanence or social benefits.

Not only have cotton mills downed their shutters and made way for real estate (including the shift from "mills to malls"), but so have heavy engineering, petro-chemical and other manufacturing industries. The finance and IT service sector cannot accommodate all those who have lost their jobs or even their progeny, due to the inability of former employees in the formal sector to educate their children adequately.

For this reason, contrary to popular perception, migration to Mumbai is declining as a percentage of the city's population increase, contributing to the deceleration of its overall demographic growth. In the 1960s, some 60 per cent of the increase was due to migrants in search of livelihoods and the rest due to natural increase. By the 1990s, this ratio was reversed, with natural increase accounting for by far the greater number.

It is common sense that people will stop coming to Mumbai if there are no jobs, even in the tertiary sector. Political parties have made much of the nuisance caused by migrants, but they are off the mark. The Shiv Sena and its breakaway MNS party in particular capitalise on raising this bogey (of "North Indians") and this periodically heightens tensions. They would do well to introspect on why things in the commercial capital are no longer what they once were.