Cabinet approves formation of a special purpose vehicle and a special project status for its redevelopment; builders to be offered perks
The decision is important in view of the forthcoming Lok Sabha and Assembly elections, because successive governments had failed to meet the residents' demands
The much-delayed Dharavi redevelopment got a big push on Tuesday, with the state cabinet's approval to establish a special purpose vehicle (SPV), and a special project status for it.
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The cabinet cleared the plan estimated to cost Rs 20,000 crore. It promises a tenement of the area of 350 square feet each to the project-affected persons. According to be information available, one lakh tenements will be created in seven years.
The decision is important in view of the forthcoming Lok Sabha and Assembly elections, because successive governments had failed to meet the residents' demand, and there were no bidders when the tenders were floated. Frequent changes in policy and design, differences with the original consultant, and issues raised by residents had stalled the project.
Perks to attract investors
The current BJP government, too, had been struggling to take the project forward, and it has now come out with something concrete that it can project as an election plank, even as the size of tenements promised and allied facilities remain a challenge.
Of the total project cost, the investor who will be chosen through international bidding, will have to put in 80% of the capital while the state government will contribute the remaining. To attract bidders, several perks like stamp duty concession, GST refund, relaxation or waiver in property tax and fungible FSI premium will be offered.
To make the project viable and expansive, 40 hectares of land will be acquired from the railways. This will be in addition to the 104 hectares of the notified land of Dharavi which has 59,160 basic structures with two to three floors built over them. There are 12,976 industrial and commercial units as well.
"The government will ensure that all eligible structures that undergo the hammer will be suitably rehabilitated in the new project," said a senior Mantralaya officer.
No splitting for redevelopment
Earlier, the (previous) state governments had decided to split Dharavi slums into five sectors, but now it has taken up the project as a one-piece component. On a pilot basis, the government had attempted to redevelop cluster 5, but the start-up had not really taken off because only two buildings could be built through MHADA.
This time, a decision of having an SVP will ensure that the company thus formed will have a legal status, which will ensure the completion of the project even if the parent company goes bankrupt.
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