do the trick
The Delhi Development Authoritys (DDAs) ambitious plan to involve private players for the development of five new sub-cities in the capital while at the same time offering a better deal to farmers whose lands would be acquired for this purpose, has drawn mixed reactions from real estate biggies and farmers.
In the 66 years of its existence, the DDA has remained the sole land acquiring agency in the capital, keeping private players at bay.
But the new land pooling policy allows owners to pool their land for development by the DDA. However, instead of cash compensation, landowners will be given 40-60% of the developed land. The policy will have two categoriesfor land above 20 hectares and between 3-20 hectares. For land measuring 20 hectares or more, owners will get 60% of the developed plot back while those having land between 3 and 20 hectares, will get 40% of it back. The remaining land would be used by the DDA. The minimum area required to be pooled is 3 hectares. The DDA will coordinate with respective civic agencies to provide basic amenities like road, sewage, water, electricity and waste disposal plants. The Delhi government will ensure transportation facilities for the areas.
So the next Dwarka or a Rohini that the DDA plans to develop will not follow the usual route of acquiring huge tracts of land and then developing it. Instead, it will allow large landholders such as farmers to pool in land for developing new sub-cities and get a share in lieu of it. According to the master plan 2021, the five sub-cities can come up near Najafgarh in west Delhi, along GT Karnal Road in north Delhi, near Burari and Sant Nagar. There is also area available beyond Rohini and near the villages of Mehrauli and Chattarpur in south Delhi.
The policy is a good step but the fine print in it is yet to be seen. Farmers in Delhi have small landholdings, which means well get only 40% land back. The DDA should compensate us for the land they acquire for public utilities. The government earns revenue from public utilities in the shape of taxes. Why shouldnt it be shared with farmers says Bhupinder Vats, who owns agricultural land in Najafgarh.
Another land owner, YS Singh of Mahipalpur in south Delhi, says, Property prices in outer Delhi have gone up. Builders are already acquiring it at R4 crore per acre. So after the sub-city is planned and the DDA provides basic utilities, we should definitely get a much better deal.
Giving the thumbs up to the new DDA policy, Manoj Goyal, director, Raheja Developers, feels it would help the DDA carry out planned and effective development through participation of private developers. This will increase the confidence of buyers and minimise the risk of non-availability of services by government agencies. At the same time, the floor-area ratio (FAR) needs to be changed. We have been requesting the DDA for the implementation of single-window clearance. If adequate FAR is allowed and the approval timeline is streamlined, we are sure that the supply in mid-income housing will be able to bridge the gap, Goyal said.
In the past, the DDA has developed three sub-citiesRohini, Dwarka and Narelain the 1980s and 1990s. However, these werent enough to meet the burgeoning demand with the rapid urbanisation that Delhi witnessed. Consequently, there was a shortage of housing and unplanned colonies mushroomed across the city, which at present house 49% of the total population of 1.7 million.
We couldnt develop more sub-cities because acquiring land became increasingly difficult. There were always issues related to compensation and shortage of land. The new policy deals with all such issues, a DDA officer told FE.
By 2021, Delhis population will touch 2.3 crore and 24 lakh additional houses would be needed. At present, there are 33 lakh residential units in the capital out of which around 40% are in rural areas, resettlement colonies and irregular colonies. The sub-cities have to come up before 2021 after which a new master plan would be made.
Delhi needs 27,000 hectares of land to build the five sub-cities, which would be able to house 60 lakh people.
Sixteen lakh residential units can come up in the five sub-cities and eight lakh more can be built by redeveloping irregular colonies. However, creating the supporting infrastructure will remain a challenge, said AK Jain, former commissioner (planning), Delhi.
At present, the three existing sub-cities Rohini, Dwarka and Narelahouse a population of 20 lakh. The additional five sub-cities would easily be able to house 50 lakh people and the rest could be accommodated by redeveloping irregular colonies and turning these into group housing societies, according to the master plan.
These sub-cities will also provide housing options in the national capital region for people who, at present, commute long distances from Delhis satellite towns to their workplaces, Jain added.
However, these sub-cities need to address the problem of shortage of affordable housing. In the whole morass of problems related to land acquisition, developers face the greatest challenges in obtaining a clean, bankable title to a contiguous land parcel of sufficient dimensions to develop projects. Another issue they face is the loss of control on cost during acquisition since the cost of acquisition after completion of the entire process is often so high that any development becomes prohibitively expensive. Often, the only way in which developers have been able to circumvent the complexities involved in the acquisition and development of land is via land pooling, said Mayank Saksena, managing director, land services, Jones Lang LaSalle India.
The big problem in Delhi is that real estate prices are really high, says Anshuman Magazine, chairman and managing director, CB Richard Ellis, an international property consulting firm. I see it as a deterrent as people coming to Delhi cant find a home. Land pooling will create supply. Prices will come down if theres more stock available.
As far as affordable housing is concerned, the government cant interfere with pricing. And theres already a policy which says some portion of the new residential projects has to be reserved for the EWS section. Let the market determine the price, he says, adding, The market is not good at present. So it doesnt mean that private players will jump in and start investing. It will take time.