Slum rehabilitation may also take auction route

  • Shailesh Gaikwad, Hindustan Times, Mumbai
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  • Updated: Apr 18, 2011 01:31 IST

The state government’s plans to auction cluster redevelopment rights among competing developers may also be used as a model for slum rehabilitation schemes including Dharavi.

Chief minister Prithviraj Chavan said he was thinking of using the auction as a model for developing slums.

“We are developing sector five of Dharavi. Our calculations show that the cost of land, which is right next to the Bandra-Kurla Complex is around Rs22,000 crore. Why should the government let builders rake in the moolah? If it is public land, let the profit go into the public coffers. It can be used for developmental work,” he said.

The cluster redevelopment auction model could change the nature of redevelopment deals in the city.

The Hindustan Times had first reported that Chavan was doing a rethink on cluster policy in its report on March 11.

So far, redevelopment policies have been based on the government using Floor Space Index (FSI) as a virtual resource to provide developers with an incentive to take up urban renewal proposals.

However, officials said that past experience shows that this model is tilted to favour developers. “There is no tab on how much profit a developer can make in the end. There is also no tab by the government on ensuring quality of construction for the rehabilitated tenements,” said an official on condition of anonymity.

Auctioning the rights for developers involved in slum rehabilitation can also weed out controversial policy decisions like the 3K clause in slum policy.

Chavan also said he was looking at reworking this clause.

The clause empowers the government to hand over the redevelopment of a large cluster of slums without inviting any bids, almost on a first-come-first-serve basis.

Kailash Agarwal, chairman, Nish Developers, whose cluster revamp project at Lalbaug is the only project that has taken off in city welcomed the proposal. 

“There is lot of headache while dealing with the tenants and the auction will bring in more transparency and generate more money for the state exchequer,” said Agarwal.

However, this could stall cluster projects in the pipeline including two mega cluster projects - redevelopment of the C ward and the Bhendi Bazar redevelopment - that were cleared by the high powered committee led by civic commissioner Subodh Kumar last week.


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