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NCR expansion: What are the gains?

It could be too early to expect Mahendragarh, Bhiwani and Bharatpur to benefit significantly from their inclusion in the NCR

realestate Updated: Jul 18, 2013 14:50 IST

What will be the outcome of the recent decision of the government to add three new entrants - Mahendragarh and Bhiwani in Haryana and Bharatpur in Rajasthan - to the exclusive NCR club? If one takes the examples of Hapur, Bulandshahar and Bagpat, which were included in the NCR a few years ago, magic should not be expected to happen overnight.

According to the NCR Planning Board (NCRPB), the expansion is for the purpose of promoting a balanced regional development, ensuring that urban infrastructure facilities such as transport, power, communication, drinking water, sewerage and drainage are brought at par with Delhi. These districts can now avail of benefits such as access to funding for infrastructure projects at concessional rates. The move also ensures that these regions will develop a proper master plan conforming to the regional plan and providing scope for the much-needed affordable housing to people.

Ramesh Menon of Certes Realty is of the opinion that these are mere announcements that are not exciting enough for industries to set up shop in these areas. “These are long term investments. Growth will take place in these pockets only after Gurgaon and Sohna in Haryana or Indirapuram and Crossings Republik in Ghaziabad have realised their full potential,” says Anckur Srivasttava of GenReal Advisers.

Ajay Aggarwal of the Avalon Group, which has several projects in Bhiwadi, Rajasthan, says the city commands a good price in the market primarily due to its proximity to Gurgaon. Comparatively, Bharatpur is located further away. “If ever we decide to launch something in the area we may bring in plotted development, villas or low rise units. An NCR status cannot be the only magnet for investors.”

Navin Raheja says that his company will explore options in the new districts only when some infrastructure work has been done, resources are in place and there is progress on ground. “I do not see immediate opportunity in the area,” he adds.

Lack of coordination between states and poor enforcement of rules has meant that integration within the region has remained a pipe dream. Development, too, has occurred only in selected areas such as Gurgaon, Ghaziabad and Noida but Hapur, Meerut, Bulandshahr and Baghpat have a lot of catching up to do. The reason is poor enforcement of NCRPB’s regional plan that calls for integrated transport, power, water, sewage and housing systems. Not much has been done to improve connectivity with the Capital or increasing economic activity/creating jobs in the regions that could have gone a long way in putting a stop to migration towards Delhi.

Though districts under the NCR have access to concessional funding, it has been seen that till March 2013, of the R18,994 crore disbursed by NCRPB, 72% has been availed by Haryana and only 11% by UP. The board offers loans for infrastructure at 7.25% interest with a 0.25% rebate for prompt repayment.

Planners say Haryana took the bigger share as the state government takes responsibility for repayment of the loan to NCRPB while in UP that has about six districts in the NCR, authorities, departments responsible or in charge of providing water, power, developing sewage systems etc are individually responsible for paying off the loan and hence the reluctance to borrow from this source. Besides, there are other sources of funding available to the state, not to mention the resource-rich authorities.

To cite a few examples, Hapur, which became part of the region a few years ago has not seen much infrastructure development or improvement in the power situation. This is despite the fact that it is perhaps the only centrally located town in UP - barely 30 km from Meerut, 50 km from Delhi and 30 km from Ghaziabad. While connectivity to Delhi by road and rail is sufficient, “NCR status has not made any big difference. The authority did take a loan from the NCR initially to develop Anand Vihar colony, a mini city, spread across 181.90 hectares, but it only took half the amount,” says Krishna Mohan, assistant town planner, Hapur-Pilkhuwa Development Authority.

Despite the great connectivity with the Capital, it faces acute shortage of power - which is essential to develop and run industries that further generate employment. Shailendra Chaudhary, vice chairman, Bulandshahar Khurja Development Authority, says that the authority has not yet taken any fresh loan from the NCRPB. It had only taken one to develop around 1000 plots as part of the Yamuna Nagar Awas Yogna. The authority is planning to acquire 100 hectares to develop a housing project in Sikandrabad and may take a loan from either NCRPB or HUDCO. It is also likely to approach the NCRPB ­for financial assistance for two new housing schemes it intends developing spread across 50 hectares each in Khurja.

A senior planner at the Baghpat Baraut Khekra Development Authority ­says out that Baghpat has not yet been able to realise the full potential of its NCR status yet and much needs to be done.

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