Fourteen years after it was first proposed, the state government has floated yet another plan to redevelop the sprawling slums of Dharavi tags
Fourteen years after it was first proposed, the state government has floated yet another plan to redevelop the sprawling slums of Dharavi.
On Tuesday, the state cabinet approved the setting up of a special purpose vehicle (SPV) to implement the 535-acre, ₹22,000-crore Dharavi Redevelopment Project, which aims to transform India’s largest slum pocket into a plush township. The state also scrapped the earlier decision of dividing the slums into five sectors and redeveloping each of them separately.
Residents, however, criticised the plan as a poll sop, while real estate experts were doubtful about it taking off during a continued slowdown in the realty sector.
A special purpose vehicle is an entity formed for a specific, well-defined purpose — mainly for infrastructure and redevelopment projects. In this SPV, the state government will have a 20% stake and offer 80% to the international consortium that wins the bid to redevelop the area. The government has also decided to float just one global tender for the entire 535 acres.
“We have many international companies interested in this project,” said Prakash Mehta, the state’s housing minister.
“We have made it viable for investors as the state government is both partner and guarantor for the redevelopment.” The project has been on the cards since 2004, but has faced several policy changes and design flip-flops.
The tendering for the project has also failed twice earlier, given the mixed usage of land in Dharavi, the eligibility criteria for rehabilitation tenaments and market slowdowns, among other factors. Under the new plan, the state will give free houses to 59,160 families and rehabilitate 12,976 commercial units that were set up in Dharavi until 2000.
“Huts that were built between year 2000-2011 will not get free homes, but subsidised ones under the PMAY (Pradhan Mantri Awas Yojana) scheme,” Mehta said. The project has also been given a boost after the Ministry of Railways has agreed to include 36.42 hectare of its land, and another land parcel of 6.91 hectare near the area in
the Dharavi Redevelopment Project. This land will be leased to the state at a nominal cost for 10 years. The state will use it to build transit accommodation for the slum-dwellers, Mehta said.
While the government is optimistic about the project’s prospects this time around, experts thought otherwise.
“Past experience has shown such high capital investments have failed to provide the requisite returns,” said Pankaj Kapoor, the CEO of Liases Foras, a real estate market research firm. “There is lot of capital investment and the gestation period is very high,” he said.
Sunil Bajaj, a real estate consultant, said, “Dharavi is bustling cottage industry, so the developer has to deal with the social and economic fabric of this place too.” He added that the redevelopment should take a holistic approach, or else it will not be viable.Local Dharavi outfits called the move a poll gambit.
“For the past four years, this government did nothing. This is just a pre-poll sop,” said Raju Kode, the president of the Dharavi Bachao Samiti. Similarly Baburao Mane, who heads the Dharavi Bachao Andolan, said Dharavi residents have been facing the brunt of policy flip-flops for the past 14 years.
“All these big-ticket tenders have failed in the past. Even this one will. The state government should have created smaller clusters and revamped it.”
First Published: Oct 17, 2018 00:45 IST