The construction ban is justified

The Nikkei India Manufacturing Purchasing Managers’ Index for July was at its lowest in the past eight years and demand took a deep dive owing to GST adjustments. By the deadline of August 25, over 36 lakh businesses had filed their GST returns. The overall impact is indicated to be an upswing of 16.6 per cent on a comprehensive level, though some states would need compensation and others may have a beneficial gain. The disruption of demand has hurt the industry and is not likely to be compensated by the same quantum of the drop.

Demand needs momentum.
The interest relaxation of 25 bps was too meagre, given the low levels of inflation currently. Public spending will need to be kept up to hold the economic growth numbers. Even though Tata Steel and JSW have begun to plan their expansion, none will invest yet. They may be keener in making a pick from the stressed companies sounding their death knells at the altars of the NCLT.

The August 29 mayhem in Mumbai was a repeat of the havoc in 2005. Little has changed in 12 years. Although social media updated everyone earlier on what was to follow and office-goers left offices earlier, as the tracks were flooded, trains stopped, electricity cut off and the Bandra-Worli Sea Link closed, traffic was left in a complete jam.

The usual areas prone to water-logging caused several people to abandon their vehicles and walk home in the filth.

The High Court has banned new construction in Mumbai and an appeal to reverse this in May 2017 was thrown out by the courts. When I raised this issue with the BMC Commissioner at a conference, he had dismissed the suggestion, saying, ‘Stopping construction is not the answer.’ Then, Mr Ajoy Mehta, what is the answer? Is August 29 your answer?

Simply put, enhancing the infrastructure capacity of the city is the answer. So what is the capacity required for a city of our population in terms of storm-water drainage, solid waste management, power, water supply, and so on? Why can’t we have the BMC targeting these numbers for the creation of capacity? These should be linked to TDR charges and capacity creation should lead permissions. In our quest to win better ‘ease of doing business’ rankings, the number of permissions have been brought down – it would now take 60 days instead of over 200 in Mumbai and Delhi to get construction permits. But permissions should be given only after enough capacity is created. Why has the BMC not been able to provide even a dumping ground for construction debris, the original reason for the ban on construction? If construction is allowed to continue without the authorities providing for increase in capacity, we will soon be seeking the ‘right to breathe’ instead of ‘right to privacy’.

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