If there is one certainty in the world, it is that more and more Indians are going to be living in cities. At last count, nearly 28 per cent of Indians were living in cities around 300 million people and the number is expected to double by 2030, with 600 million urban denizens.
Maharashtra, as India’s most industrialised state, will have to find solutions to the problems of rapid urbanisation. Apart from public transport and civic infrastructure, the biggest challenge is really housing. The problems are amplified in Mumbai, where people come for jobs, but housing is simply unaffordable as land prices have gone through the roof.
“We are all for providing affordable housing in the city, but the problem is land. Unlike the state housing board, private developers do not get land at a subsidised rate,” says Sunil Mantri, managing director of Sunil Mantri Realty Ltd and a panelist for the July 10 State Summit organised jointly by DNA and Zee 24 Taas with the support of the Maharashtra government.
It’s not as if the state government hasn’t done anything. The Urban Land Ceiling Act was abolished, a housing policy was finalised in 2008, the floor space index (FSI) was raised from 0.5 to 1 in urbanisable areas outside the city’s municipal limits, and laws were changed to ensure that home buyers were sold properties on the basis of carpet area rather than built-up and super-built up areas.
With 60 per cent of Mumbai’s population living in slums, a Slum Rehabilitation Scheme has been put in place. Chief Minister Ashok Chavan has emphasised the importance of housing by keeping the portfolio with himself. But glitches remain.
“Contrary to the misconception that developers get prime real estate free of cost from redeveloping slums and chawls, we pay 25 per cent of the land cost as per ready reckoner rates to the civic body. This is in addition to the huge construction, and transit building costs. This makes the cost equivalent to what land costs in the open market. I would hope the government, if it is keen on promoting affordable housing, addresses this issue in the State Summit,” Mantri added.
The session of housing, which looks at policy challenges and options, will see many political and other luminaries coming up with ideas for change. Among the speakers will be Manohar Joshi, former Lok Sabha speaker and exchief minister of Maharashtra, Chandrashekhar Prabhu, housing sector expert, Sitaram Kunte, housing secretary, Ajit Gulabchand, chief of Hindustan Construction, and Pranay Vakil, chairman, Knight Frank India.
That there is a great demand for housing in the affordable segment was established at the MHADA housing lottery held on May 19, 2010, for the second time. For an offer of 4,000 flats, Mhada got 4.33 lakh applicants.
If experts are to be believed, the emphasis should be on the creation of new areas and townships with infrastructure and facilities rather than further developing existing urban areas. Until and unless supply is increased by freeing up land locked under urban land ceiling or salt pan reservations or something else, reduced prices will remain a mirage.
Senior officials in Maharashtra say they are initiating the process of creating more affordable houses by bringing in more private land. “Under a memorandum of understanding signed with the Maharashtra Chamber of Housing Industry, five lakh homes will be constructed by MCHI members, but won’t necessarily be constructed on government land. Incentives are to be given to private developers who bring in private land by regulatory concessions, including the grant of 2.5 FSI. We foresee that through this process we will be able to increase the supply of affordable homes,” said a senior housing official.
Other panelists at the summit will be Manohar Joshi, former LS Speaker, Sitaram Kunte, principal secretary (housing), Chandrashekhar Prabhu, former MHADA chairman, Ajit Gulabchand, chairman and MD of Hindustan Constuction Company, and Pranay Vakil, chairman, Knight Frank India, global property consultants.
