Maharashtra govt asks SRA to give Rs 300 bn for Dharavi redevelopment
Real Estate

Maharashtra govt asks SRA to give Rs 300 bn for Dharavi redevelopment

The Maharashtra government has directed the Slum Rehabilitation Authority (SRA) to provide 3 billion rupees to the Dharavi Redevelopment Project Authority (DRPA). This money will be used to pay the Indian Railways for 45 acres of land that will be amalgamated with the slum for the redevelopment project. The other 100 crore rupees will be used as DRPA's equity share in the Special Purpose Vehicle (SPV) that will be set up to implement the project.

The SRA has been asked to provide the funds even though the developer, Adani Realty, has not yet been formally awarded the contract. The cabinet approved Adani's appointment as lead developer in December 2022, but the formal appointment has been delayed due to concerns about Adani's finances.

The government reached an agreement with the Railway Land Development Authority (RLDA) in 2019 to lease 45 acres of railway land for 99 years at a cost of 38 billion rupees. The government has already paid 8 billion rupees of the 10 billion rupees for the land. A definitive agreement was signed in October 2022. As per the agreement, the 2 billion rupees were to be paid by April 17, 2023.

A survey of the land was taken up in December 2022 by revenue officials along with railway and DRPA officials. Along with the 10 billion rupees, DRPA will redevelop the railway quarters and hand them over to the railways; besides it will also be given a share of the profits in the redevelopment project.

The GR states that the SPV to be formed for the implementation of the project will pay 5 billion rupees to the RLDA. This money to the SPV is to be paid by the lead developer within 90 days of the contract being awarded. "Since the letter of award has not yet been issued, the money needs to be arranged from the SRA. As an equity holder the DRPA needs to pay 1 billion rupees towards the SPV. SRA will be reimbursed after the SPV is formed," states the GR.

Adani Realty recently sought to know the quantum of Transfer of Development Rights (TDR) that would be generated from the project. Under DCPR 2034, it is mandatory for redevelopment projects utilising TDR to first use 50 per cent TDR generated from the Dharavi project. Sources said the quantum of TDR generated would depend on the number of persons eligible for free housing. The survey can be done only after the contract is awarded and SPV is formed.

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The Maharashtra government has directed the Slum Rehabilitation Authority (SRA) to provide 3 billion rupees to the Dharavi Redevelopment Project Authority (DRPA). This money will be used to pay the Indian Railways for 45 acres of land that will be amalgamated with the slum for the redevelopment project. The other 100 crore rupees will be used as DRPA's equity share in the Special Purpose Vehicle (SPV) that will be set up to implement the project. The SRA has been asked to provide the funds even though the developer, Adani Realty, has not yet been formally awarded the contract. The cabinet approved Adani's appointment as lead developer in December 2022, but the formal appointment has been delayed due to concerns about Adani's finances. The government reached an agreement with the Railway Land Development Authority (RLDA) in 2019 to lease 45 acres of railway land for 99 years at a cost of 38 billion rupees. The government has already paid 8 billion rupees of the 10 billion rupees for the land. A definitive agreement was signed in October 2022. As per the agreement, the 2 billion rupees were to be paid by April 17, 2023. A survey of the land was taken up in December 2022 by revenue officials along with railway and DRPA officials. Along with the 10 billion rupees, DRPA will redevelop the railway quarters and hand them over to the railways; besides it will also be given a share of the profits in the redevelopment project. The GR states that the SPV to be formed for the implementation of the project will pay 5 billion rupees to the RLDA. This money to the SPV is to be paid by the lead developer within 90 days of the contract being awarded. Since the letter of award has not yet been issued, the money needs to be arranged from the SRA. As an equity holder the DRPA needs to pay 1 billion rupees towards the SPV. SRA will be reimbursed after the SPV is formed, states the GR. Adani Realty recently sought to know the quantum of Transfer of Development Rights (TDR) that would be generated from the project. Under DCPR 2034, it is mandatory for redevelopment projects utilising TDR to first use 50 per cent TDR generated from the Dharavi project. Sources said the quantum of TDR generated would depend on the number of persons eligible for free housing. The survey can be done only after the contract is awarded and SPV is formed. Also Read Mumbai Metro opens FOBs on Metro Line 7Mumbai: The coastal road will probably open in parts this year

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