While the government has retained these conditions, it has downsized the required size and cost of these projects by 50 percent, a move that will enable developers to show smaller projects as previous experience to fit the eligibility criteria, tender documents show. While the government has retained these conditions, it has downsized the required size and cost of these projects by 50 percent, a move that will enable developers to show smaller projects as previous experience to fit the eligibility criteria, tender documents show. Ahead of the 2019 Lok Sabha polls, the Maharashtra government on Tuesday sanctioned a new plan to change the face of Asia’s largest slum sprawl — Dharavi. The latest plan — involving resettlement of 60,000 slum structures into planned habitats — is estimated to result in the creation of over five crore square feet of saleable buildable space next to Mumbai’s most development business district — the Bandra-Kurla Complex — where real estate prices are among the highest in India. Even as Dharavi’s revamp, which was first conceptualised in 2004, has been on every political election agenda, it has failed to take off. Two rounds of global tenders — one between 2007-11 and another in 2016 — had not elicited response from private buildings. Making a final attempt to redevelop the slum colony as a whole, the government, on Tuesday, inducted major changes to the project’s technical and financial models. While the earlier approach was to divide the 240-hectare area into five developable sectors and develop them independently, the government has now combined them into one. This basically means that the whole slum can now be redeveloped by a single entity, which has enhanced the commercial gain for them in it. When private builders did not come forward for the redevelopment, the then Congress-Nationalist Congress Party government had even awarded the work for the redevelopment of one of the sectors (Sector 5, 62.05 hectare) to state-owned Maharashtra Housing and Area Development Authority (MHADA). But on Tuesday, even this sector was merged with the remaining ones. When contacted, a senior BJP minister argued, “The MHADA lacks resources for the redevelopment work. All they have managed so far (in seven years) is to construct two buildings. Complaints regarding the quality of their construction work have also been raised.” Mumbai’s new development plan, which has special regulations for Dharavi’s redevelopment, has enhanced the overall buildable space that can be constructed in the project through revisions in certain regulations. The government is banking on these to attract investors. As far as the financial model is concerned, the previous approach was themed around private redevelopment, whereas the government has now decided to form a Special Purpose Vehicle (SPV) involving the shortlisted private partner and itself, where it would hold 20 per cent equity. The big-ticket project will cost Rs 26,000 crore. The government, through the Dharavi Redevelopment Project Authority (DRPA), will bring in an equity of Rs 100 crore, whereas the SPV’s lead partner would have to bring in a minimum share premium of Rs 2,850 crore. Of which, Rs 400 crore will have be invested within a month of appointment. The government has said that the gestation period for the initial investment is estimated to be seven years, while the entire project will take 25 years to complete. To attract foreign MNCs, the state has also allowed the option of reinvestment of accumulated dividend shares into equity on the condition that the state’s stake won’t be diluted. Besides capital investment, the state also waived the stamp duty payable on the transfer of development rights and has announced a rebate on the state’s GST component for the construction work. It also announced concessions in premiums payable on land, FSI, and open space deficiencies. Housing minister Prakash Mehta, when contacted, said, “Revisiting the financial model and extending concessions was necessary owing to project’s overall size and various development constraints. The slum’s situated in the airport funnel zone and has a dense mix of hutment, tenanted units, and informal industry settlements. We felt that the SPV route will boost investor’s confidence,” he said. “There has been adequate planning at the micro-level this time around. All the limitations and the constraints have been overcome,” Mehta said. The project was also conferred the status of a vital project. Special powers have been conferred on the CEO, DRPA for land acquisition and removal of encroachments. The DRPA has been made the planning authority for the cluster allowing it to clear building proposals. While the state’s revenue department has stated that the stamp duty waiver will result in a big loss of revenue, the housing department has said that the formalisation of industries in the region will hugely benefit the state’s exchequer eventually. Wadala salt pan land to house Dharavi slum dwellers A 20-hectare salt pan land in Wadala has been identified to build transit camps for hutments dwellers affected by the Dharavi revamp project. Sources said that Union Ministry of Commerce has already showed its willingness to allow leasing of the salt pan. Transit accommodation for 20,000 hutment dwellers is proposed to be built on this land. Chief Minister Devendra Fadnavis has also held talks with Railway Minister Piyush Goyal for the handing over of 36 hectare of railway land in Matunga for the project. In return, the state has offered to build a residential township for railway employees. For all the latest Mumbai News, download Indian Express App

Stay updated with all the Mumbai Latest News headlines here. For more exclusive & live news updates from all around India, stay connected with NYOOOZ.