New Delhi: Owing to the tepid response received from private developers for its in-situ slum rehabilitation (ISSR) scheme, the Centre is now considering a slew of changes to the existing policy, including increasing the plot area for the maximum remunerative component given to developers in a bid to make it more attractive for them to take up projects, ThePrint has learnt.
Under the existing policy, for a plot of 2,000 square meters (the minimum plot size for the projects), the maximum remunerative component given to developers was 40 percent. This is now being increased to 50 percent. It is through the remunerative component that a private developer recovers the cost of providing houses to the economically weaker section (EWS) under the ISSR projects.
A 50 percent remunerative component would mean that 50 percent of the plot area could be used by the developer to recover their costs involved in building the dwelling units for the slum dwellers, either by building a residential or commercial property in that area.
Further, a reduction in the minimum plot area in the rehabilitation component, which is the area used to build the dwelling units for slum dwellers, has been proposed at 50 percent, instead of the existing 60 percent.
“We are still considering the changes we want to make to the proposed policy. We have not finalized it as yet,” a senior Delhi Development Authority (DDA) official, who did not want to be named, said.
In 2022, the DDA, the city’s main development agency, which comes under the Ministry of Housing and Urban Affairs (MoHUA), had received negative bids from developers in response to tenders floated for 10 ISSR projects in the city’s Dilshad Garden, Pitampura, Rohini, Haiderpur and Okhla, among other areas.
A negative bid is when the winners in an auction pay the government instead of charging consumers for their development costs.
The housing ministry had put out a public notice on 23 March this year listing the proposed amendments and seeking objections and suggestions. However, the ministry is yet to finalise the amendments despite the lapsing of the 45-day notice period.
“The amendments are still under consideration and it remains unclear whether they will reflect in the final notification of the Master Plan,” said the second DDA source.
The ISSR provisions are among the components of the Master Plan for Delhi (or MPD-2041) — the DDA’s ‘strategic’ and ‘enabling’ framework to guide the future growth of Delhi — currently under review.
Government sources told ThePrint that the proposed changes stem from multiple ISSR projects failing to take off in Delhi.
The other proposed tweaks to make the ISSR projects more financially viable include lifting the restriction on the density for rehabilitation and remunerative components under the ISSR scheme.
This would mean that a developer would no longer be restricted to providing 900 dwelling units (DUs) per hectare and 200 DUs per hectare under the rehabilitation and remunerative component (if they choose to build residential units) – which is the existing norm.
The developer, the second source said, has also been exempted from providing 15 percent of the built area for EWS housing if they are to use the remunerative component for residential purposes. Further, a developer can have more built area, with the floor area ratio being proposed to be increased to 400 from the existing norm of 300.
ThePrint has reached the Delhi Development Authority spokesperson for comment over WhatsApp on the current status of the 10 ISSR projects for which tenders were floated last year, and the proposed changes to the ISSR provisions in the MPD-2041. The article will be updated when a response is received.
Also read: ‘Every day feels like a festival’: Rehabilitated slum families start afresh at DDA Kalkaji high-rise
Public-private partnership
“The developers seek a hefty amount upfront in terms of viability gap funding and the DDA cannot provide that. These proposed tweaks are aimed at removing roadblocks, but we are also looking at the Mumbai model of slum rehabilitation, since the latter has worked out over there,” said the second source at the DDA.
This would not be the first instance of the DDA referring to the policy adopted by Mumbai. In 2018, senior DDA officials had visited Mumbai to study its slum rehabilitation policy and on-ground progress, reveal documents available on the DDA website.
According to these documents, while Mumbai’s Slum Rehabilitation Authority (SRA) notifies the slums and conducts its surveys, the policy there allows impaneled developers to assist slum dwellers in forming a cooperative group housing society and in getting it registered.
The developer is required to obtain consent of 70 percent of slum dwellers in the cluster to submit a rehabilitation project plan to the SRA, while the latter has the power to examine the project proposal and the financial, technical and planning aspects.
In comparison, in Delhi the DDA holds a competitive bidding through which a developer is chosen for the ISSR project.
According to the records of the Delhi Urban Shelter Board (DUSIB), 675 slum clusters were identified in Delhi for ISSR projects in 2014-15, of which 376 are located on land parcels owned by the centre.
In December last year, the DDA completed and inaugurated 3,024 flats for those from the economically weaker sections (EWS) as the first phase of its slum redevelopment project in Delhi’s Kalkaji area — the first such ISSR inauguration by the DDA.
The project was conceptualised in 2011 and the foundation stone laid in 2013.
The agency had taken up the entire cost of the project and is yet to recover the same, noted the second source.
“The EWS flats were sold on highly subsidised prices, and we (DDA) will recover the expenses only when we sell or utilize the land from which the now-rehabilitated slum dwellers are vacated,” said the first source.
The DDA, the second source added, wants to stick to the public-private partnership (PPP) model — of bringing developers on board — to execute ISSR projects, adding that the agency is not in a position to solely pour its finances into projects, which are large-scale and time-consuming.
While the Kalkaji project was the first, and only, to be inaugurated till date, the first project to be announced was in 2009, in the city’s Kathputli Colony. This is yet to be completed. Another ongoing project in the city’s Jailorwala Bagh has seen a draw for the allotment of houses, while its inauguration remains yet to be announced.
A spokesperson for the Raheja Developers, which is executing the Kathputli Colony project, told ThePrint that 1200 EWS houses under the Kathputli Colony ISSR project have been completed and handed over to the DDA. Moreover, 900 houses are nearing completion and shall be handed over to the DDA “by December, and that the project will be inaugurated in the coming year”.
The spokesperson noted that the developer faced difficulties in executing the project owing to the Covid-19 lockdowns and construction bans in the national capital, which hampered the speed of construction.
The spokesperson, however, did not respond to queries on whether any financial challenges were faced in the completion of the project.
(Edited by Poulomi Banerjee)
Also read: What’s the ‘Delhi model’ of slum rehabilitation & how it compares to other cities