Not much for Mumbai in PM’s ‘Housing for All’ project

Modi’s pet project not suited to address unique housing problems region faces.

Written by Sandeep A Ashar | Mumbai | Published: September 2, 2015 1:04 am

Prime Minister Narendra Modi’s pet project, ‘Housing for All’, does not seem to have much to offer for land-starved Mumbai Metropolitan Region (MMR) where acute housing shortage is one of the biggest challenges.

The Maharashtra government, which is shortlisting cities and towns to be included in the Centre’s mission, is of the view that the fiscal incentive offered was untenable in Mumbai. “Mumbai has about 13 lakh slum dwellings in existence prior to January 1, 2000 and eligible for rehabilitation. A grant of Rs 1 lakh per dwelling will require Rs 13,000 crore, which is financially unviable,” a senior government official said.

The Modi government has promised an average grant of Rs 1 lakh per slum household rehabilitated through such projects. Though the housing mission includes a component of grants for rehabilitation of slum dwellings under private partnership, senior state officials said that Mumbai might have to do with the ongoing slum redevelopment model where the state allows private players to leverage slum-locked lands for rehabilitation projects.

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Another hurdle in Mumbai’s inclusion among cities covered is a rider that the beneficiary family must not own a pucca house anywhere in the country. Senior officials said the state government has approached the Centre for withdrawing the rider. “The housing crunch in Mumbai is most severe among the migrant population. Most have pucca houses in their native places,” said a senior official.

The housing department has proposed that the existing slum redevelopment model through the Slum Rehabilitation Authority (SRA) be adopted for Mumbai. The SRA model allows developers to use slum-locked lands as resources and extend floor space incentives against rehabilitation of slum dwellers. Official statistics reveal that since the model was rolled out in 1996, less than 13 per cent slum projects have been completed.

The ‘grants for slum rehabilitation’ model may not work in Mumbai’s satellite town, Thane, too.

Of the 24 lakh eligible slum dwellings in Maharashtra, nearly 18 lakh are in Mumbai, Thane, Pune, Pimpri-Chinchwad, and Nagpur. “It has been decided that slum redevelopment under the state’s existing SRA model be continued in these cities,” a senior official said.

The state has decided to include 20 smaller towns (Class C and D) in the Centre’s model. The state has proposed to extend an additional grant of Rs 1 lakh per dwelling from its own kitty to 16 D class cities. In Chandrapur (Vidarbha) and Parbhani (Marathwada), where housing projects have not taken off, the state proposed to grant an additional Rs 3 lakh for slum rehabilitation projects.

Mumbai, where land prices have soared, will not derive much from the second component, which involves extension of credit linked interest subsidy for purchase of affordable homes. The Centre has proposed an interest subsidy of 6.5 per cent for home loans availed by economically weaker home-buyers; but has introduced a cap that this benefit would be available for loans up to Rs 6 lakh.

The Centre has promised assistance of Rs 1.5 lakh per home constructed for economically weaker sections through public private partnership projects. Just as Maharashtra has decided to provide an additional assistance of Rs 1 lakh from its own resources for this component, senior officials said that developers in MMR, where construction prices are among the country’s highest, are unlikely to be enthused by the option.

The government is not in favour of the fourth option, Rs 1.5 lakh subsidy for construction of individual housing, since it is wary of graft complaints. The Centre has set 2022 as deadline for achieving housing for all. A proposal for inclusion of cities from Maharashtra will soon be placed before the cabinet.

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  1. Hemen Parekh
    Sep 2, 2015 at 10:48 am
    DREAM HOUSE BY 2020 ? Shri Ravindra Waikar , Minister for Housing , Maharashtra Government , says ( DNA / 16 Aug 2015 ) : " We want to provide a dream house to everyone by 2020 . We won't compromise on the quality of construction . It will be at par with that of private builders . We are working on a mission mode " He is referring to planned construction of 5 lakh " affordable " houses ( flats ? ) , by 2020 No doubt , this is a very daunting task but it is possible if there is " Political Will " - which is evident from above statement of Shri Waikar Here are my few suggestions that Shri Waikar may want to consider : # SPECIFICATIONS * Carpet Area = 400 sq ft * Selling Price = Rs 10 lakhs ( Rs 2,500 / sq ft ) # LOCATIONS * Building Clusters to be located on the outskirts of cities ( important ) * 100 Clusters of 50 buildings ( each with 10 floors*10 flats/floor ) # LEGAL FRAME-WORK * A Special Purpose Vehicle ( SPV ) , named, Dream House Private Limited ( DHPL ) # INDUSTRY STATUS * Infrastructure Industry with 100 % FDI thru automatic route # SPV OWNERSHIP * 10 % equity by Maha Govt ( in lieu of land ) Maha Govt to p on this equity to land-owners * 90 % equity by WinSun Decoration Design Engineering Co ( China ) # SHARE CAPITAL * Rs 10,000 Crores # ROLE OF MAHARASHTRA GOVERNMENT * Acquire land ( under modified Land Acquisition Act )/hand over to SPV * Comprehensive Town Planning of each Cluster like a Smart City * Building Design / Drawings / Material Specs * Quality Control / Material Testing Lab at each site * A Project Monitoring Team at each site / Use of PERT * Site surveillance using CCTV cameras * Make available land for setting up 3D House Printing factories * Interconnection of site offices with HQ , thru VPN * Blanket permissions ( IOD / NOC etc ) issued in advance * OC based on certification from Site Project Manager * Maintenance of flats thru Coop Societies of each cluster # COMMERCIALS * Neither SPV , nor Maha Govt to pay any royalty to WinSun for transfer of technology * Maha Govt to act as the agency for allotment of flats to eligible public in Maharashtra thru a " Lottery System " * Selling Price of flats will be fixed by the Maharashtra Government once a year , based on a pre-agreed cost - escalation formula, which will be explained in detail on SPV web site Calculation of each upward revision shall be made public * SPV to hand over possession of flat to the allotee upon receipt of full payment * SPV shall not be permitted direct selling of any flat in Maharashtra * SPV would be free to set up factories in other States and be free to sell flats built there, thru Open Market # ROLE OF WinSun * Setting up of 20 factories for 3D Printing of flats * embling of 3D printed flats at sites * Transfer of 3D house printing technology to Indian project managers / site engineers / construction workers # TECHNOLOGY * 3D ( house ) Printing Technology developed / patented by WinSun > WHY WinSun ? # On 29 March 2014 , WinSun constructed TEN , 3D printed houses ( 200 sq meter each ) in Shanghai, each costing $ 4,800 ( approx Rs 3 lakh ! ) # On 17 July 2015 , using its 3D printing technology , WinSun built a 2 storey villa , in just 3 HOURS ! # WinSun holds 98 patents for construction materials # For 3D printing of houses , WinSun , mostly uses recycled construction materials # 3D house-printing technology saves, * 30% -60 % of building materials * 70 % of production time * 80 % of construction cost # Egypt Government has placed on WinSun , an order for supplying 20,000 pre-fabricated , 3D printed houses # In Egypt , WinSun will establish 12 Dream Factories ( to build pre-fabricated houses ) , within 2 years These factories will mostly use desert sand as its main construction material , which was found ideal for 3D printing of houses ! # In next 3 years , WinSun will set up ( in JV with local parties ) , similar factories in 20 countries , including Saudi Arabia , UAE , Qatar , Mexico , S. Korea , Russia , Morocco , Tunisia , and USA As someone has said : " It is OK to build castles in the air , as long as you know how to put foundation underneath , later on " Even if you are dreaming of building 5 lakh castles ! ----------------------------------------------------------------------------------- hemen parekh 02 Sept 2015 B2BmessageBlaster