Even as a proposed investment, one of the largest in affordable housing, with a private developer backed by the Canadian Pension Fund, is likely to fall through, the state government is now in talks directly with the Canadian government for a new deal to support some of its ambitious projects.
The state government is likely to sign a memorandum of understanding (MoU) with the government of Canada for financing its projects related to affordable housing, slum redevelopment and creation of smart cities. Senior officials had a meeting to discuss the details of the proposed MoU last week.
A senior official from the Slum Rehabilitation Authority said, “This agreement will be directly between the government of Maharashtra and the government of Canada, and not through any single developer. While a major portion of this might be for slum redevelopment, the agreement will also open doors for investment by the Canadian government in smart city and other affordable housing projects being implemented by other agencies.”
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He added that the MoU will not be bound by a quantum of investment that will go into the projects. “There isn’t any fixed investment proposed, but we will, after due diligence, enter into contract with developers who come through the Canadian government with their financial backing for the projects,” he said.
The state government has set an informal target of building 19 lakh low-cost homes by 2022, of which it hopes to build 11 lakh in the Mumbai Metropolitan Region alone.
Similarly, the government has decided to support the development of all 10 cities that are vying for a spot in the Prime Minister’s pet ‘Smart Cities’ mission irrespective of their selection by the Centre. The plans of all 10 cities as submitted to the Union government are cumulatively worth over Rs 30,000 crore, while the state is willing to set aside its share of Rs 400 crore a year, and is looking at bringing in the rest through external financing.
Earlier, the state government was considering an investment proposal by a private developer, Mumbai-based Deserve Group, with the financial backing of the Canadian Pension Fund, and consultant IL&FS on board.
The deal, which the government was hoping to close during the grand ‘Make in India’ week held in February in Mumbai, proposed to create 3.5-4 lakh affordable houses in Mumbai by exploiting prime slum plots between Cuffe Parade and Borivli under the slum redevelopment scheme, with the developer promising to build low-cost houses on the sale component.
The agreement was however put on hold with the state government having no confirmation directly from the Canadian Pension Fund on the proposed investment.