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Investors could make a beeline for shacks after govt decision

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Indian Express        05.01.2012

Investors could make a beeline for shacks after govt decision

 Slum rehabilitation

The state government’s announcement ahead of BMC elections to expand the free housing net in the city is expected to trigger a rush among investors who would want to buy slum shacks for the huge dividends they will offer when they come up for redevelopment, housing experts said.

Until now, only shanties built before the cut-off date of 1995 and residents who have been living there before the same cut-off date were eligible for free housing under the Slum Rehabilitation (SRA) scheme.

In the case of shanties in Dharavi, on airport land and those affected by vital infrastructure projects, the cut-off date was 2000, both for residents and their shacks. But in an attempt to appear like it is fulfilling a promise it made ahead of BMC elections in 2007 — that the cut-off for all slums would be extended to 2000 — the Congress-NCP alliance government announced on Monday that free housing would become available to anyone who purchases an eligible structure at any time, provided they can furnish proof that they have been living there for at least a year. All they are required to do is pay a transfer fee of Rs 40,000. 

The latest announcement came a day before BMC elections were announced and voting set for February 16.

“Slum residents will be stripped of the very protection that was available to them by virtue of not allowing them to transfer their property. Now it becomes easier for builders and middle classes investors to buy a shanty from the slumdweller, who will go and live in a hutment elsewhere,” said housing expert and former MHADA chairperson Chandrashekhar Prabhu. 

 

 

A government-commissioned survey carried out by Pune-based NGO Mashal (Maharashtra Social Housing and Action League) in Dharavi showed that in anticipation of the Dharavi Redevelopment Project taking off soon, more than 5,000 shanties were purchased by investors over four to five months in 2009 alone. Prabhu added that the Cabinet’s recent move could also come to the notice of the Supreme Court as it had earlier allowed the government to extend the cut-off date for free housing to 1995 based on the undertaking that it would not be extended further.

Pankaj Joshi from the Urban Design Research Institute pointed out that the policy will end up turning eligible shanties into a marketable commodity. “As of today, 800 of the total 1200 SRA projects are stuck in litigation as almost 50 per cent of the people in each project were rendered ineligible. While the new rule will ease the issue for developers and bring in a huge number of slums into the net of SRA, it will put a heavy strain on infrastructure since for every free house that a developer constructs for the slum resident, his own share of free sale component increases,” he said. 

Prabhu said the state government’s free housing policy is in direct conflict with the Centre’s policy of getting slum residents to contribute a portion of the money that goes into providing them formal housing. “People living in slums are able and willing to contribute money for a permanent house. The trap of free housing is the reason why such Central schemes don’t take off in Mumbai,” said Sharad Mahajan, founder of Mashal. He added that in Pune alone, the NGO had collected Rs 3.5 crore from slum residents for construction of their houses.