Delhi’s new law on public-private partnership for land development seems tailor-made to suit big builders and marginalise housing for economically weaker sections
This is the story of a Ministry that has simply sat back and outsourced to private companies complete charge of both social responsibilities and economic development in the urban sector. It began with a warning that the McKinsey Global Institute sounded in its “India’s Urban Awakening” report. India, it warned, could catch up with the rest of the developed world only if it increased the size and density of its metro cities by three times, for which it had to borrow nearly $2.2 trillion (Rs. 125 lakh crore). The warning made sense to the Ministry of Urban Development. We are at a point where the ratio of urban population will grow to 50 per cent by 2030 while 60 per cent of urban people still live in slums.
If India was to become the world’s second largest urban market for jobs, it was time to hurry and notify that recommended nationwide web of urban-industrial corridors to link our metros. The scramble for notified land would monetise it. The first of these 19 planned corridors was launched in a tearing hurry. It links the two great slum cities of Delhi and Mumbai with a 1500-kilometre long and 300-kilometre wide “dream zone” of cities and factories. Documented by the Scott Wilson Group, it has been predicted that one-third of the total population of India could move into this corridor by 2030 even though it is located in the most severely dry region of the country. Water would have to come from mining the fossil aquifers deep below the earth’s surface. The Bayou Corne sinkhole in Louisiana caused by water mining into this fossil layer of the earth’s crust serves as a grim reminder. Regardless of such risks, the Cabinet has cleared a budget of $90 billion, in its urgency to urbanise India.
Pursuing its ticking clock initiatives to urbanise, the Ministry directed the Delhi Development Authority, which in turn sponsored the National Centre for Applied Economic Research to tell them how Delhi could begin to increase its size and density. The NCAER responded with its findings in “Land Pooling and Development Models for Delhi.” Its version of land pooling is tweaked in favour of private land consolidators. The report is not in the public domain and needs the RTI to make it accessible.
It inverts the purpose of land pooling which should normally be done by public authorities in partnership with small land owners in four transparent steps:
1. Public authorities assemble small farmer land lots into much larger urbanisable land parcels.
2. They then provide services, master plan and road infrastructure to all corners of these assembled land parcels.
3. As compensation, the public authorities keep between 15-30 per cent of the assembled land parcel for themselves — just enough to sell and fund the cost of providing the infrastructure, and housing some of the poor.
4. The rest of the assembled land parcel gets fully planned with infrastructure and is returned with new title lots to the farmer owners for sharing amongst them.
The two key words in land pooling should be social unification and partnership that enable cohesion of communities while solving problems of uncertain land titles, access to urban services and provision of new urban identities for small landowners living on the fringes of a city. It is a social measure to be initiated by the public authorities, mutual owner associations or public corporations, and is monitored by a council of owners. Other countries have done it as a responsible activity. It can also run into problems as in Nepal where — although done with the best of intentions and with the help of the Asian Development Bank — protests have stopped a scheme in the Sundarbapur Basti Project.
Most lucrative model
Land pooling is at best a strategy to help small farmers and the poor and homeless who can be given housing by the public authority from their share. Land is at the heart of it. In Delhi, however, the strategy may reveal its worst aspects — behind the veneer of social charity is an attempt to harvest rich profits. The Ministry of Urban Development commissioned the DDA, which in turn commissioned the NCAER to write a recipe to maximise profits from land pooling. Three models were considered for profitability and the model that gave the most profit for the owners was chosen.
Once builders have bought out the farmers, they get termed as “owners of the land” and the significant benefits of such a PPP scheme automatically accrue to them. This strategy for intense densification of Delhi is rather unfortunate and will eventually wither Delhi since it does not even have sufficient water to cope with its present demands. Delhi, in the future, needs to be sustainable, not just profitable. The prospect of builder entities channelling water from Himachal Pradesh for their newly gated communities seems remote.
Nevertheless, the new law for enabling land pooling was announced in the Gazette by the DDA in April this year. Builders as landowners-in-waiting had become impatient. The entire 1500 square kilometres of the Delhi State is scheduled to be urbanised by 2021.The new law has released over 600 sq km for land pooling. Much of this has already been consolidated through complex “agreements to sell” between builders and farmers based on small bayana deposits while they wait to become the “Developer Entities” whom the DDA will regard as owners. Under the new law, Developer Entities can keep 60 per cent of the land they consolidate (40 per cent in smaller 3-19 hectare parcels) for building multi-storied gated communities, commercial shops, malls, etc., for sale after putting in the roads and amenities. Fifteen per cent of the land is set aside for economically weaker sections that currently constitute 60 per cent of Delhi’s population. The new law supersedes the 2021 Master Plan and doubles the permissible built floor area to an FAR of 400. Builder entities can now build and sell twice the number of floors that the 2021 Master Plan had allowed. The DDA is to provide the roads, external trunk services and master plan infrastructure.
As the Khemka-Vadra controversy has shown, land bought from farmers and then pooled by developers can become a tradable instrument that passes from owner to owner. Agency profits are earned at each stage for consolidating, changing the land use and building the project.
In response to the urgency of the government, early bird land pooling projects have surfaced and we can understand more clearly what will happen to Delhi. The first wave has already hit the desks of the DDA for approval as slum rehabilitation schemes. Slum lands have been auctioned through tenders to the largest eight or nine builders in the city. The slum dwellers will be moved to distant transit camps while redevelopment takes place. The builder will build three components on the slum land. A block of flats for his private clientele, a shopping mall with commercial shops and, thirdly, some densely packed 20 floor blocks for the slum inhabitants. These too will become our urban sinkholes. In one such project, 13,000 slum dwellers have been accommodated in multi-storied blocks that cover 18 per cent of the ground of their erstwhile slum land while the balance of the land has been given to 700 clientele buyers, a commercial mall and shops, leaving the rest for roads, etc. Here lies the paradox. The very Ministry that promulgated the 12th Schedule of the 74th Amendment 21 years ago has ended up usurping the powers it gave the local bodies.
(Romi Khosla is the chair for the CII Sub-group on Delhi 2021 and Advisor to the Delhi Urban Arts Commission)