HOUSING FOR ECONOMICALLY WEAKER SECTIONS (EWS)

AND SLUM DEVELOPMENT IN METROS -THE MUMBAI

EXAMPLE
By Niranjan Hiranandani, Managing Director, Hiranandani
Constructions Pvt. Ltd, Mumbai
As the Financial and Commercial capital of India, Mumbai has acted like a
magnet, attracting people from all over the country. The reasons are wide and
varied- from simply an opportunity of earning a living, to making a killing in the
stock market, or making it big in Bollywood, fashion, business or sport. Today this
great metropolis has over 12 million people residing and more pouring in
everyday. Over 50% this population is forced to reside in slums and unauthorized
settlements on both public and private lands-under unhygienic conditions coping
with constant water shortages, improper health, sanitation and power facilities. If a
fair size of Rs.40, 000 crores of the countrys GDP is generated under such
circumstances, one can only conjecture as what could be possible contributions
under more dignified living conditions.
We need to just step back a bit and pause to think as to how in 56 years of post
Independence, we have descended to this level. The answers are not difficult to
find. A combination of wrong policies at various times along the way and
unfortunate recessionary market conditions during the period 1996 to 1999 would
briefly sum up the situation. However, as a person born and brought up in this
great city, I believe we can still salvage the remains and resurrect it to proportions
that are comparable with the worlds best if not better. But for that to happen, we
must not dwell in recriminations of the past. Rather, we need to bury the
differences, adopt a holistic approach and undertake to do what is good for our
city. This requires that there is close cooperation between the Centre, the State,
the Local Authorities, the NGOs, the corporates, the businesses and the citizens
in a spirit of give and take. And, I believe the starting point for this is the instilling
of pride in all the stake holders of this city.
The housing schemes that were initiated during the years 1996 through 1999 did
not receive the support they needed as the industry itself was under recession
and finance for large schemes was difficult to obtain. As a result, there has been
inertia in taking up such proposals again. Let us examine this issue of housing in
the broader perspective of not only regularizing and reconstructing those slums
built prior to 1st Jan 1995 but also in providing for the fresh influx that will inevitably
flow into this city. The slum policy could be formulated in three aspects:
1. Those slums which can be developed through private initiative must be
encouraged. People will undertake projects that they find viable and for
which they are able to arrange finance themselves. Hence existing
schemes with some minor modifications should be continued.

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2. Slum schemes that can be developed as a Co-operative by the slum
dwellers themselves or through the support of NGOs who can act as
catalysts in the development process.
3. Certain slum areas do not have the economic viability for redevelopment.
Such slums could be upgraded without going through the reconstruction,
redevelopment, transit accommodation and financing modes. Such
schemes require that the dwellers come together and are willing to become
owners securing tenure and title to the property as their incentive.
However, to be able to provide a real boost to the housing sector and create
additional housing stock in the metropolis will require that the laws that are
onerous or have long outlived their usefulness are forthwith dispensed:
1. Urban Land (Ceiling & Regulation Act).
That this act needs to be scrapped has been accepted. Punjab, Haryana,
Gujarat, Karnataka and all the Union Territories among others have done
so. Yet it still exists in two of the so-called progressive States like Andhra
Pradesh and Maharashtra. The Finance Budget of 1999 initiated many
incentives to the Housing Sector. But the benefits can percolate down to
the actual customer only if impediments like this Act are scrapped.
2. Stamp Duty
The Government of Indias National Housing & Habitat Policy 1998
prescribed that Stamp Duty rates should be brought down to between 2%
to 3% as per international norms. In Maharashtra the rates are 8%, while it
is even higher in some of the other States. It is a firm conviction of many
that just as when Income Tax was reduced from 97% to 35%, the collection
went up 10 times; so also when Stamp Duty is reduced the collection will
rise dramatically. It will also reduce evasion and corruption which is
currently so topical.
3. No Development Zone (NDZ) Lands
The Development Plan of Greater Mumbai provides for about 33% of lands
in suburbs as NDZ lands. These are not green lands, but those where
zoning will be done in future. In view of the shortage, there is an urgent
need to rezone these lands as otherwise they will be encroached upon and
compromise formulas for development will be required to be worked out.
4. Salt Pan Lands
There is a proposal pending wherein the Govt. of Indias Urban
Development Dept. has taken the initiative of proposing that the
Maharashtra Govt. terminate the leases of the defunct salt works and take
over the lands for housing. The large tracts of land released on this account
will be of immense benefit in providing low cost housing. The proposal
needs to be approved as fast as possible.

5. Coastal Regulation Zone (CRZ).

From time immemorial, all great civilizations have traditionally sprung up on
the sides of great rivers like the Indus, Nile, Tigris, Ganga, Brahmaputra
etc. In the present times, port cities like Hong Kong, Singapore, San
Francisco, New York to name a few have permitted FSI ( FAR) of 10 and
more, reclaimed land from the sea and even built hotels and airports in the
reclaimed area. But Mumbai has a rule that does not permit new
development within 500 m of the High Tide Line. Fortunately, Nariman
Point, Cuffe Parade and Marine Drive came into being before the law came
into force in Feb 1991. Protecting the environment is an extremely
important issue, but to apply the CRZ law without appreciation of ground
realities is to ensure that Mumbais aspirations to become a world class city
are stillborn.
6. Rental Housing
People the world over are able to acquire shelter on both rentals as well as
ownership basis. However, some of our archaic laws have prevented
Institutions as well as individuals from entering the rental market. And this
has led to lack of availability of rental housing. Recent modifications in the
Rent Control Act have definitely brought succor to the people. But
confidence building measures are necessary for Institutions and individuals
to invest in this as a form of business. Further, the MCGM needs to be
encouraged to amend regulations to provide reasonable rates of taxes for
housing given on rent.
7. Enabling provisions for Project Affected Persons (PAP).
The procedure followed in the rehabilitation of PAP often ends up leading to
litigation and project delays and cost overruns. A large number of
Infrastructure projects such as Roads, Railway lines, Water Supply,
Sewerage etc. have been held up in the past 20 years due to court
injunctions. It is now very necessary to bring in new laws so that schemes
can be taken up and completed after alternate accommodation details for
PAP have been executed satisfactorily.
8. Developing the Textile Mill lands
Over 100 hectares of textile mill lands exist in Central Mumbai most of it
in a state of disuse. The land presents an unique opportunity to address the
demographic problems of the city from a long term perspective. But, to
unlock the true potential of this huge tract of land requires a holistic
approach and a combined effort from all of us.

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9. Real Estate Mutual Funds
Real Estate Mutual Funds may seem out of place in the context of EWS
and slum redevelopment. However, availability of funds in large volume
and at reasonably low interest rates will provide a boost to the construction
industry and thereby the Economy. The trickle down effect of a robust and
bustling economy will be felt in all strata of society.
There are many other aspects also like providing employment for unskilled
labour through implementation of mega infrastructure projects, creation of
satellite townships with industrialization to curb unnecessary migration to
major metros, social issues like health care, compulsory school education etc.
In conclusion, it must be reiterated that the National Housing & Habitat Policy
1998 is an excellent and well conceived document that has addressed all
these issues and more. It has also been approved in the Lok Sabha. It now
needs to be rigorously implemented at all levels to ensure that the basic need
of shelter to all and a better quality of life can be provided for the citizens of
India.