1

PRESENTATION AT
CONFERENCE ON REAL
ORGANISED
ESTATE BY WIRC

SLUM REDEVELOPMENT – IMPORTANT ISSUES

Presented by:
Dipali Sheth, Partner, MDP & Partners
At: Hotel Sea Princess, Mumbai
On July 15,2011
 2

BACKGROUND
• India is undergoing transition from rural to
semi urban society.

• People are migrating from rural to urban

areas.

• Mismatch between demand and supply of

housing in cities.

• Disparity in prices of property and income

levels leading to non-sustainable situation.

• Lack of equitable supply of land, shelter

and services at affordable prices
 3

CONSTITUTIONAL RIGHT

• Article 14 of the Indian Constitution provides

that the State shall not deny to any person
equality before law or the equal protection
of laws within India.
• Article 19 of the
Indian Constitution
provides that the
all citizens shall
• have the right to
freely move
throughout in India
inequalities income and endeavour to
and alsoinequalities
eliminate to residein status, facilities and
and settle not
opportunities in only
any amongst individuals
part amongst
but of India.group of people residing in
Article areas.
different 38 of the
Indian Constitution
provides
 4

HISTORY
Till 1970 Demolition of slums by treating
them as illegal squatters. Slums reappeared.
Demolitions termed inhuman.

1970 to 1990: Slum improvement works

taken up. Census of slums was carried out in
1976 and I-cards were issued.
and occupied by slums was given on lease to
the slum dwellers. Soft loans were extended
to slum dwellers to take up slum
upgradation works. The scheme could be
implemented only on non-reserved govt.
lands.
 5

HISTO RY
• 1990: A Special autonomous authority
Rehabilitation Authority
Slum (“SRA”) was
established. The Developers were encouraged
to develop the underlying land of the slums
and incentive of FSI for constructing tenements
for sale in open market was allowed in lieu of
free housing for slum dwellers.
• 1997: The Government of India sanctioned the
modification to the Development Control
Regulation Nos.33(10), 33(14) and 60 of the
Development Control Regulations for Greater
Bombay 1991 for implementation of Slum
Rehabilitation Scheme (“SRS”), as a part of
final Development Plan for Greater Mumbai
which came into force from October 15, 1997.
(Source www. sra.gov.in)
 6

POWERS AND DUTIES OF SRA

• The powers, duties and responsibilities of SRA are as follows:

• to survey and review existing position regarding Slum areas in greater
Mumbai.
• to formulate schemes for rehabilitation of slum
• areas.
• to
to get thesuch
do all slum rehabilitation
other scheme
acts and things implemented.
as may be necessary for achieving the
objective of rehabilitation of slums.
• SRA can declare any area as slum rehabilitation area in accordance with SRS. All
slum rehabilitation areas come under the jurisdiction of SRA.
• SRA undertakes aforesaid functions through its departments
such as Planning & Implementation; Building Permission and
Supervision; Eligibility Certification, eviction on non-
participants
areas; and declaration
Registration of slumhousing
of co-operative areas societies;
and slum Land Management;
rehabilitation
Community Development; Accounts and Finance; and General Administration.
 7

DIFFERENCE BETWEEN SLUM REDEVELOPMENT AND

SLUM REHABILITATION

• Whilst Slum Redevelopment Scheme is for

improvement of living conditions of slum dwellers,
and to make them habitable with basic amenities
such as clean drinking water, sanitary, street lighting,
etc. However, Slum Redevelopment Scheme do not
provide for rehabilitation.

• SRS aims at providing good housing to the slum

dwellers as specified in the SRS of an area consisting
of 225* sq. ft. free of cost and self contained .
 8

SALIENT FEATURES OF SLUM REHABILITATION

SCHEME
• According to the Slum Rehabilitation Scheme
of Government of India (‘SRS”) every slum
structure existing prior to January 1, 1995 are
legalised and treated as protected structure.

• Every slum dweller whose name appears in the

electoral rolls as on January 1, 1995 and who
continues to stay in the slum is eligible for
rehabilitation.

• Under the SRS, every eligible residential slum

structure is provided with an alternative
tenement admeasuring 225.00* sq. ft.
preferably at the same site, irrespective of the
area of slum structure.
 9

SALIENT FEATURES OF SLUM REHABILITATION

SCHEME
• Every eligible slum structure that is
being used for commercial purposes is
granted an alternative tenement
having area equal to the structure
subject to an upper limit of 225.00*
sq. ft.

• Under the SRS, minimum of 70% of

eligible slum dwellers can form a co-
operative housing society for
implementation of SRS. The slum
dwellers can appoint a developer for
execution of SRS.

• The underlying land is used as a

resource for the SRS.
 10

SALIENT FEATURES OF SLUM REHABILITATION

SCHEME
• The developer puts in resources in the
form of money, men and material for
construction of free houses for the slum
• The developer is compensated for his efforts in the form of free sale component.
dwellers.
The developer is required to construct the rehabilitation tenements on the plot
itself. The balance FSI left is allowed for construction of free sale tenements. Along
with the free rehabilitation tenements the developers also have to provide space
for amenities like a creche (Balwadi), society office, welfare centre.
• The developers are allowed to construct tenements for sale in the open market.
The area allowed for sale in the open market is equal to the area of tenements
constructed for Rehabilitation of slum dwellers.
• Floor Space Index (known as FAR elsewhere) upto 2.5 is allowed for SRS. The spill
over entitlement to the developer is permissible for sale in the form of
transferable development right in the open market. These transferable rights
can
be utilised on other non slum pockets subject to the provisions of Development
 11

SALIENT FEATURES OF SLUM REHABILITATION

SCHEME
• The plots which are reserved for public
purposes and which are over run by slums
can also be taken up for implementation of a
SRS. In case of plots reserved for
• unbuildable
In case of plotsreservations, 33% reservations,
reserved for buildable of the a certain predetermined
reservation
proportion ofarea
theispermissible
left free forbuilt
the intended
up area is to be constructed as per the
reservation.
requirement of user agency and handed over free of cost to the city
administration as a part of SRS.
• Slum Rehabilitation Authority (“SRA”) is empowered as single window approving
authority for development under the SRA.
• An additional 5% FSI incentive for commercial area is available to the projects
being implemented by either a society of slum dwellers directly or a NGO.
 12

SLUMS – A PROBLEM?

• YES because:
▫ it makes city look dirty;
▫ breeds poverty;
▫ high unemployment leading to
illiteracy and child labour;
▫ high crime rate including thefts;
▫ also as it is illegal settlements on
encroached public land, they d o
not pay the basic or civic utilitie s
taxes and hence, burden on
infrastructure.
 13

PROBLEMS FOR SLUM DWELLERS

• Inhuman and dangerous living

conditions due to lack of security;
• Constant fear of losing their homes;
• No hygienic and sanitary facilities;
• No clean drinking water;
• No basic civic services like
waste
• collection
No properlyand disposal;
maintained drainage
system;
• No electricity or paved
roads.
 14

ADVANTAGES OF SLUM
REDEVELOPMENT
•
planned development of large parcels of
Slum redevelopment facilitates
land. Such planned development proper and
increases
the supply in congested cities like Mumbai
and exerts downward pressure on existing
property rates. Such planned development
also reduces burden on infrastructure.

• SRS encourages through public private

partnerships (PPPs) facilitates access prime
and large tracts of land. Due to the
incentives of SRS including higher-than-
normal floor space index (FSI) costs of land
reduces thereby enabling developers to
gain higher margins on saleable portions.
 15

CHALLENGES IN SLUM REDEVELOPMENT

• The Government should encourage the PPP model. Many SRA schemes that has
followed this model in past have been successful in Mumbai such as SRA
development done by developers such as Ackruti, HDIL, Unitech and Hiranandani.

• Having said that there are certainly challenges to effective slum redevelopment
largely depends on ownership of land. In case the land is privately owned, there is
often resistance from the owner in parting with it. Also it is difficult to ascertain
the existing slum dwellers as there is no authentic record upto date is available in
respect of all slum pockets.
 16

ROAD BLOCKS ON SLUM REDEVELOPMENT

• There exists no authentic and acceptable record of slum dwellers in

respect of most slum areas around the country. Hence, despite
regulations and policies being in place for SRA, the redevelopment is not
effectively implemented. Further, in order to avoid misuse of the liberated
land effective implementation is essential.

• Often due to apprehensions and objections of slum dwellers the SRS

cannot be effectively implemented.
 17

APPLICABLE LAWS ON SLUM REHABILITATION

The following are some of the important legislations in Maharashtra on slum

redevelopment and slum rehabilitation:
1. The Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act,
1971;
2. The Development Control Regulations for Greater Mumbai, 1991 (the “DC
Regulations”);
3. The Maharashtra Regional and Town Planning Act, 1966;
4. The Mumbai Municipal Corporation Act, 1888;
5. The Maharashtra Prevention of Dangerous Activities of Slumlords, Bootleggers, Drug
Offenders and dangerous Persons Act, 1981;
6. The Maharashtra Housing and Area Development Act, 1976; and
7. The Bombay Provincial Municipal Corporation Act, 1949
 18

IMPORTANT PROVISIONS OF DC REGULATIONS

APPLICABLE TO SRS
The most important are some of the provisions of DC
Regulations which are described
1. Regulations
below: 33(10) read with Appendix IV of the DC Regulations provides the
eligibility and method of redevelopment of slums including the pavements whose
inhabitants names and structures appear in electoral roll on or prior to January 1,
1995. In the schemes approved under the provisions of this DC regulation, the slums
are rehabilitated on the same site.
2. Regulation 33(13) of the DC Regulations provides that FSI of 2.5 shall be available for
the development of sites reserved for resettlement and rehabilitation for the purpose
of housing slum dwellers who are displaced by projects undertaken by the Municipal
Corporation. In the schemes approved under the provisions of this DC regulation, an
owner of vacant unencumbered land can use it for construction of PAP tenements for
which he is compensated by TDR for land and for construction.
 19

IMPORTANT PROVISIONS OF DC REGULATIONS

APPLICABLE TO SRS (continued)

3. Regulation 33(14) of the DC Regulations deal with transit camp tenements for
SRS. It provides that temporary transit camp shall be provided by the developer
on the site or closer to the site. Further, the area of temporary transit
accommodation shall be excluded from the computation of FSI. In this scheme,
the landowner is allowed to consume the existing FSI potential of the land, owned
by him. The additional potential of 1.5 for suburbs, 1.66 for difficult area & 1.00
for island city (only for government or public sector plots) is granted under this
scheme. The developer constructs transit tenements out of a prescribed part of
this additional potential. The balance of the additional potential is allowed as free
sale component.
 20

IMPORTANT PROVISIONS IN APPENDIX IV OF DC

REGULATIONS PERTAINING TO SRS
According to Appendix IV of the DC Regulations:
• 5% of commercial FSI is granted to the society of slum dwellers or an NGO if the project
is undertaken by the society or NGO.
• It is mandatory to provide one balwadi and welfare center and society office each of
20.90 sq.mt areas (225 sq, ft.) for every 100 rehabilitation tenements or part thereof.
• Area of balwadi, welfare center, society office and common passage upto 2.0 m wide is
allowed free of FSI in rehabilitation building. Hence, the areas consumed for such
balwadi, welfare center , society office and common passage is excluded for the
purpose of calculating the permissible FSI. The aforesaid areas together with area of
eligible religious structure, other social infrastructure such as school, dispensary,
gymnasium run by public authority or charitable trust and incentive commercial area in
addition to FSI for rehabilitation tenements are termed as “rehabilitation component”.
• Sale component equal to 0.75 times the rehabilitation component in city areas; equal
to rehabilitation component in suburbs and extended suburbs and equal to 1.33 times
the rehabilitation component in difficult areas is allowed.
 21

IMPORTANT PROVISIONS IN APPENDIX IV OF DC

REGULATIONS PERTAINING TO SRS (continued)

• Maximum permissible FSI to be consumed at any site shall be restricted to 2.5 and
balance can be claimed as TDR, to be sold in open market.
• Minimum density on plot shall be 500 tenements per net hectare.
• All the activities existing in the slum even if non-conforming with the zone of the
area shall be allowed to be relocated.
• All reservation plots upto 500 sq.mt. in area under slum shall be cleared of slums
and the slum dwellers shall be relocated elsewhere.
• Plots reserved for non-buildable reservations and encumbered with slums shall be
cleared if the area is less than 500 sq.mt. or they are encumbered to an extent less
than 25%.
• Special concessions in building requirements are granted. Viz. Relaxations in open
space requirement; Relaxations in room size requirement.
 22

Stages of Slum Rehabilitation

Stage I
• As stated earlier, all slum dwellers residing on the plot prior to 1/1/1995 and are in
use of the structure are eligible for rehabilitation. Consent of at least 70% of the
slum dwellers and such slum dwellers co-operative housing society (see Shivaji
Krishna Zunjare Vs. State of Maharashtra & Ors. 2004(4) Mh LJ 764);
• Appointment of a chief promoter. Collection of share capital of Rs. 50/-
per member and Re. 1/- as entrance fee. This is then deposited in the name of
the
proposed housing society in the Mumbai District Central Co-operative/
Maharashtra State Co-operative Bank Ltd.;
• Society collects documents of title of the land. The plot is then measured and the
slum structures are surveyed, properly demarcated and numbered on the plan. A
detailed list of house numbers and the name of the occupant is prepared.
• Developer is appointed by the society and the developer then appoints Architect/
Licensed surveyor; structural engineer; etc.
• The developer then enters into individual agreements with all the slum dwellers
agreeing to participate in the scheme and a proposal enclosing requisite plans;
annexures and documents is submitted by the architect to SRA.
 23

STAGES OF SLUM REDEVELOPMENT (CONTINUED)

Stage II
• The Sub-engineer of SRA’s office undertakes initial scrutiny of the proposal. If all
requisite documents are submitted along with the proposal, the amount of
scrutiny fee to be paid is worked out by the sub-engineer and paid by the
developer.
• Thereafter, Annexure II (details of land occupied by slum dwellers, number and
types of structure, consent to join the scheme, list of eligible and non-eligible
occupants, etc.), is forwarded to the competent authority for certification.
Simultaneously, Annexure III for assessing financial capability of the promoter is
forwarded to the financial wing for scrutiny Thereafter, Annexure I (ownership
details, slum dweller details, FSI available), reservations, amenities, etc.) is sent for
scrutinisation by the engineering wing.
• After Annexure II & III are certified by the competent authorities, approvals to LOI,
layout. Intimation of Approval and commencement certificate to the first building
for work upto plinth are processed.
 24

STAGES OF SLUM REDEVELOPMENT (CONTINUED)

Stage III
• The society draws lots for allotment of the tenements to the members who are
ready to participate in the scheme. Draw for the non- participating members from
the remaining tenements is also drawn.
• The developer arranges transit accommodation for the slum dwellers either on-
site or off site as mutually agreed between the slum dwellers and the developers.
• In case transit accommodation cannot be arranged on site due to site constraints,
SRA helps the developers to locate suitable site in the vicinity for construction of
transit camps and to obtain permissions from concerned authorities.
• Draw of lots for allotment of transit tenements is drawn.
• Thereafter, the slum dwellers are shifted to the transit camps and their hutments
demolished. The slum dwellers who do not agree to participate in the scheme are
given notice by the society staling the allotment details and requesting them to
participate in the scheme.
 25

STAGES OF SLUM REDEVELOPMENT (CONTINUED)

Stage III (continued)

• If the non-participating members do not agree to participate within 15 days of the
approval of the proposal, they are physically evicted from the site under the
provisions of Sections 33 and 38 of Maharashtra Slum Areas (Improvement,
Clearance and Redevelopment) Act, 1971, to ensure that there is no obstruction to
the scheme.

• After demolition of the structures, work upto plinth is completed. The SRA then
checks the plinth dimensions and if found in order further permission to carry out
construction beyond plinth is granted.
 26

STAGES OF SLUM REDEVELOPMENT (CONTINUED)

Stage IV
• Plans for the further buildings both for sale and rehabilitation are then
approved.
• Building permissions for the sale buildings are given in the proportion of
the permissions given to the rehabilitation buildings.
•
Upon completion of rehabilitation building/ wing, list of allotment is
drawn up. The allotment is done in the joint name of the head of the
• household and the spouse.
• Building completion certificate is submitted by the architect.
After checking of the building and compliance of the IOA
• conditions
Occupation permission to the building is granted. The slum
dwellers as per
the allotment list are given possession of the tenements.
SRA issues identity cards to the slum dwellers.
 27

STAGES OF SLUM REDEVELOPMENT (CONTINUED)

Stage V
• Further construction of the remaining building/s is then taken up.
• Further building permissions as well as occupation permissions to the
buildings is then granted in due course.
• Upon completion of the last buildings
in the layout, the underlying land is
transferred on lease to the society of
slum dwellers.
• Separate propertyIncards
case forof the
Government
rehabilitation building plot and the sale
lands, the
building plotlease rentasis for
as well nominal.
the reservation plots to be handed over are
prepared. SRA acts as facilitating agency in case of any difficulty with the
revenue authorities.
 28

LATEST DEVELOPMENT IN SLUM REHABILITATION

Families in Slums (in Lakhs) • Slum dwellers, meeting the existing cut-off
date of January 1, 1995, will get free housing in
Prior to 1995 After 1995
rehabilitation buildings and those settling post-
1995, might have to pay a portion of the
construction cost of the houses.
38% • An expert group is formed by
the Government of India to
62%
look into re-settling people,
who built slums after 1995.
Over 13 lakh families stay in
shanties in Mumbai; among
• Recently, a panel headed by state chief secretary Ratnakar Gaikwad and comprising
those 5 lakh reportedly built
officials from the housing and the SRA, the BMC and MMRDA discussed the feasibility
their shanties after 1995.
and the amendments of various legislations required to implement the centrally-
sponsored Rajeev Awas Yojana (“RAY”) to overcome the slum problem in the city. It is
pertinent to note that the RAY scheme, where the Government of India pays 50% of the
fund, specifies no cut-off for rehabilitation.
 29

LATEST DEVELOPMENT IN SLUM REHABILITATION

The Government has announced a new scheme called Rajiv Awas Yojana (RAY) for
the slum dwellers and the urban poor. This scheme aims at providing support to
States that are willing to assign property rights to slum dwellers. RAY envisages a
‘Slum-free India’ through encouraging States/Union Territories to tackle the problem
of slums in a definitive manner. On the basis of the recommendations of the industry
experts and Expenditure Finance Committee the Minister is in the process of moving
the Cabinet for the approval and the draft Cabinet Note has been circulated for
inter‐ministerial consultation on 31‐12‐2010.
RAY endeavours the following:
• Bringing existing slums within the formal system and enabling them to avail of
the same level of basic amenities as the rest of the town;
• Redressing the failures of the formal system that lie behind the creation
of slums; and
• Tackling the shortages of urban land and housing that keep shelter out of reach
of the urban poor.
 30

LATEST DEVELOPMENT IN SLUM REHABILITATION

RAY envisages that each State would prepare a State Slum-free Plan of Action
(POA). The POA would need to be in two stages viz;
• Stage-1 regarding the upgradation of existing slums. In Stage-1 the State
would need to survey and map all exiting slums in selected cities proposed
by the State for coverage under RAY. ; and
• Stage-2 regarding the action to prevent new slums. In Stage-2 the Plan
would need to assess the rate of growth of the city with a 20 year
perspective, and based on the numbers specify the actions proposed to be
taken to obtain commensurate lands or virtual lands and promote the
construction of affordable Economically Weaker Section (“EWS”) houses so
as to stay abreast of the demand. This part would need also to make
necessary legislative and administrative changes to enable urban land
expansion, and in town planning regulations to legislate reservations for
EWS/Low Income Group housing in all new developments.
 31

LATEST DEVELOPMENT IN SLUM REHABILITATION

• In the meantime the preparatory phase of RAY has already commenced under
Slum‐free City Planning Scheme from March 2010 and States are being assisted to
draw up their Slum‐free Plans of Action to proceed towards the goal of Slum‐free
Cities/States in a systematic and time bound manner. Under the RAY, a sum of Rs.
60 crores has been released to 20 States for preparing Slum free City Plans during
2009‐10. Budget of Rs1,270 crores has been allocated for the year 2010‐11 for the
scheme.

• Further detailed guidelines have been issued for Slum Free City Planning
under
RAY.
• Ministry of Housing and Urban Poverty Alleviation, Government of India
(“MHUPA”) has selected 30 cities across 16 states for initiating the ‘National Slum
Free City Campaign’.

• The MHUPA had in February 2009 also issued modified guidelines for Projects of
Integrate Housing and Slum Development Programme.
 32

SOME FACTS ON SLUM REDEVELOPMENT

• Around one-third of the urban population in World Population in
developing countries – nearly one billion people
Slums
– lives in slums, according to estimates.

• UN-Habitat estimates the world’s slum

33%
population will be 889 million by 2010.

• More than 70 per cent of Africa’s urban 67%

population lives in slums. The majority of slum
dwellers in African cities are between the ages
of 15 and 24.

• Slums are often economically vibrant; today,

about 85 per cent of all new employment
opportunities around the world occur in the
informal economy.
 33

SOME FACTS ON SLUM REDEVELOPMENT

• Between 2000 and 2010, the number of
slum dwellers increased by six million
No of Slum dwellers (in every year.
million)
1600 • The number of slum dwellers is
estimated to grow by nearly 500 million
1400
between now and 2020, according to
1200
UN-HABITAT. (Source: UN-HABITAT
1000 State of the Wo rld’s Cities Report 2010-
800 2011)
600 Slums
400 • It has been realised that effective
200 planning for slum redevelopment has to
0 be more participatory, involving
cooperation from NGOs, private sector
and the slum dwellers themselves,
mostly represented by Community
 34

DHARAVI PROJECT

• Dharavi is reputes to be one of Asia’s largest

and highly dense slums. 57,000 families are
squeezed into 535 acres of Dharavi area.
• Dharavi redevelopment project in Mumbai,
which is talked about for more than a decade
now went into bureaucratic limbo. Dharavi
falls in a prime locality between BKC and the
Lower Parel mill district. This means that
projects there would naturally cater to high-
end property buyers. With the applicable FSI of
4 there being difficult area instead of the usual
SRA ceiling of 2.5, the Dharavi redevelopment
project can house numerous luxury housing
projects after rehabilitation of existing
hutments.
 35

DHARAVI PROJECT

Population of Mumbai • The Government of Maharashtra has vide its

(in million) resolution dated February 4, 2004 resolved to
Normal housing Slums
implement Dharavi Development Action Plan and
for SRA is declared as Special Planning Authority.
The detailed information , guidelines and rules
and regulations on Dharavi Redevelopment
Project is under finalisation.
35%
• As we know, this project is currently in
suspended on the grounds of pending
Government approvals. Also even after approvals
65% due to bureaucratic approach in all Government
offices, the time-frame for completion cannot be
predicted.
 36

THANK YOU
Presented by:
Dipali Sheth
Partner
MDP & PARTNERS
Advocates & Solicitors
1st floor, Udyog Bhavan,
29, Walchand Hirachand Marg,
Ballard Estate, Mumbai 400001
8989
Tel: - +91 22 6686 8900 I Fax: - +91 22 6686
Email:- [email protected]
Website: - http://www.mdppartners.com