The Centre-appointed Land Development Committee (LDC), in its draft report to the ministry of shipping on opening up port land for development, has rejected suggestions to sell builders the land to generate funds for building amenities in the city.
Highly placed sources told the Hindustan Times the committee had rejected attempts to allow people with commercial interests to take over this land. It is expected to retain this stand in its final report as well.
The report instead suggests various revenue models for the redevelopment projects, without having to part with the land. Of these, the build-operate-transfer (BOT) model is an important one, by which private agencies will be encouraged to take up construction of infrastructural projects, and then be allowed to operate them to recover costs.
“This will be the preferred option for capital-intensive projects, which may not be easy to fund otherwise,” said a source from the Mumbai Port Trust (MbPT).
However, many experts have criticised the committee for allowing the BOT model to flourish, as it involves private agencies operating amenities — something that may be controversial.
Other revenue models suggested by the LDC include development charges, property taxes and viability-gap funding, to ensure project works take off. The report also suggests taking loans from funding agencies such as the World Bank and Japan International Cooperation Agency (JICA) to fund many of these projects.
“In case of amenities that the public will use, such as parking or aquariums, we could collect user charges from visitors. This will help us fund other projects,” said a member of the LDC.
Another option the LDC is mulling is the creation of funding structures based on amenities. “For instance, if we are constructing new roads or related infrastructure, we may impose a toll tax on vehicles,” a source from the committee said.
However, committee members clarified that no one model could be employed for all the projects. “There will have to be a mix-and-match between these funding options suggested in the report,” the source said.
Further, the report emphasises on creating a new waterfront for the city, as well as creating more open spaces for the city.
The final report on the project is expected by next month.