Noida realty: Down,but not out

Under a new regime,the dream run Noida had over the last five years is on the wane. Proximity to Delhi may be the only advantage left

Written by Dipankar Ghose | Published:June 23, 2012 3:42 am

In the five years that Bahujan Samaj Party supremo Mayawati was in power,it seemed that Noida and its adjoining areas were to be made the showpiece of the state. Greater Noida was co-developed as a residential satellite city,an international airport was proposed at Jhewar,and the Rashtriya Dalit Prerna Sthal,a grand 685 crore monument-complete with 52 statues was built to commemorate the Dalit cause. The result of this concentration of development in the region made Noida the place to go for builder,investors and flat buyers alike,and saw a sharp rise in the real estate prices over the five years.

OUTLOOK DIMMED

The change in guard in March however,has seen a change in outlook from the state government. The Akhilesh Yadav led Samajwadi Party government has scrapped several of Mayawati’s pet projects,with the official versions being that,the projects were far too large in scale. “These large projects,including certain social programmes are far too costly and target a small audience. The emphasis of this government is to bring more people into the development fold. It has been estimated by us that the amount of money saved by scrapping several projects and schemes set up by the BSP government is close to Rs 4,861.72 crore,” said an official.

The scrapping of these projects,some of which have affected Noida as well,has resulted in a change in the real estate market as well. Take for instance,the land acquisition problem in Greater Noida. Culminating in the violent clash between farmers and the administration at the twin villages of Bhatta Parsaul in May 2010,farmers alleged that their land was taken away under the “urgency clause”,and given to developers at much higher rates.

They said that at the time when the government took away their land,the farmers were assured that industries would come up around their villages. Farmers then went to the Allahabad High Court in protest. In an October 2011 judgement,the Court rescinded the land acquisition of three villages,and asked the Noida and Greater Noida Authorities to increase the compensation given to farmers by 64 per cent in the other 61 villages that went to court.

The judgement was initially read as a victory for the lakhs of buyers who had invested in homes in the area,because of the lower costs as compared to flats in Delhi. Soon however,the enthusiasm vanished. One of the reasons was the decision of farmers to appeal against the decision in the Supreme Court,unhappy that they were not returned their land,despite the increase in compensation.

The second reason is,however,that the change in the stance of the government. While the BSP government firmly placed its stock behind the developers and flat buyers,the Samajwadi government ran its electoral campaign standing behind the farmer cause. Party officials told The Indian Express,“No further land of farmers have been acquired for any new projects. We have to review the mess that the previous government made and come up with better policies,else we will also have to face agitations. The cause of the farmers is important to us.”

Another angle to the land acquisition problem,is that in its October judgement,the Allahabad High Court asked the Greater Noida Authority to get all construction projects cleared by the NCR Planning Board. “It has been close to seven months but no clearances have been given. There has been no construction on our plots. The government has shown very little initiative despite requests from so many of us who have our dream homes there. The situation with the farmers as well as the delay in clearance is discouraging for those people who want to invest in the future,” said Annu Khan,vice president of the Noida Extension Flat Owners and Members Association.

DREAM PROJECTS REVERSED

Another piece of news that caused the real estate prices in the region to rise over the past five years,was the announcement that a new “Greenfield International Airport” would be constructed in Jhewar.

Close access to an airport in the vicinity of Noida,became a draw for many. Within months of the new government coming in,an announcement was made that the airport proposal would have to be scrapped.

“This wasn’t a decision of the government. The airport was planned much earlier but was awaiting central government clearance. However,the norms are that there cannot be any international airports within 150 kilometres of each other. The proposed Jhewar airport was less than a 100 kilometres away from Delhi. Another possible sport,Partapur,was quashed for the same reason. A new airport is now being proposed in the Agra-Mathura region. Though,this is not a good thing for the real estate development of the region,not much could have been done about it. While the last government wanted to push for the Jhewar airport,the SP saw Agra and Mathura as equally viable,” said a Noida Authority official on the condition of anonymity.

An example of a social scheme that has now been scrapped and has affected the real estate sector has been the removal of reservation clauses in the awarding of construction contracts.

Representatives of the government said that the reservation was adversely affecting the quality of work and raising costs. For builders,the decision has been one of the positive ones for them in this tenure,lowering cost and raising the quality of construction.

Ramesh Chand,who is a contractor having various projects in Sectors 70 and 71 said,“This reservation was ridiculous. In the construction business,there was no advantage that anyone had. It resulted in the contractors benefiting from this reservation from taking undue advantage,and raising the prices that they charged. Further,since the scheme limited competition,they increased their profit margins by using inferior quality material,to the detriment of the builders.”

For home buyers then,the investment scenario in the Noida and Greater Noida region is bleaker than it was five years ago. With farmers having approached the Supreme Court,and NCRPB clearance still awaited,the trend seems to be one of wait and watch. If the court and the Planning Board rule favourably,the situation may ease out. Whatever the eventual outcome,Noida will always have the natural investment advantage of being able to offer cheaper housing than Delhi does. The time,however,for Noida to be the centre of attention has seemingly come to an end.

— dipankar.ghose@expressindia.com

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