The Maharashtra government, on April 25, 2018, approved the Mumbai Development Plan 2034. While the real estate sector welcomed the plan, others have expressed concern over its impact on infrastructure.
The research wing of rating agency CRISIL, said the 2034 DP will release over 3,650 hectares of barred zones and salt pan land for development but added that while the move is a positive one for development, it is likely to ‘pressurise existing infrastructure further’. “Though the upcoming metro projects are lined up, keeping in mind this DP provisions, the growth of real estate supply is likely to happen faster than the infrastructure extension,” its director Binaifer Jehani said.
Property consultancy ANAROCK’s Anuj Puri echoed the same sentiments, saying, “If infrastructure development does not keep pace with increased construction, the stress on civic amenities and traffic may worsen in the city.”
Just a few months ago, speaking in presence of prime minister Narendra Modi, city-based corporate house Mahindra’s chairman Anand Mahindra, had warned that infrastructure woes will repel investors. “If Mumbai, the ‘crown jewel’, continues to groan under its weight, it will drive away investors. If the city begins to groan under its own weight and mismanages growth, then, you may just as well turn away investors,” he had said. Ratan Tata had also flagged the same issue, while speaking at the same event, remarking that over the last few years the industrial growth in Maharashtra ‘had exceeded the ability of the state to provide infrastructure to support’.
Property consultant CBRE’s chairman for India and south Asia Anshuman Magazine, called the new DP a ‘game changer’ for the city’s real estate market, which has not had the best of times in the recent past. As widely expected, the real estate sector, which is struggling with sluggishness that has resulted in inventory pile-ups, welcomed the government move. Developer Niranjan Hiranandani, who is also the president of industry lobby NAREDCO, said the hike in floor space index will enhance GDP growth and also boost employment. The attention towards creating affordable housing and equal focus on residential and commercial development, were some of the salient features of the plan, which were welcomed by the industry. The concept of walking to work and the stress on maintaining open spaces, also found mention in the reactions from the industry.
The much-awaited Development Plan 2034 for Mumbai, paves the way for the space-starved city to have more land available, to build homes and commercial spaces. Infusion of new developable land and increasing the FSI (floor space index) in the island city up to 3 for residential properties, are the major takeaways of the revised Development Plan, which will be the blueprint for the city’s land use over the next 16 years. FSI is the ratio of the total built-up area to the total area of a plot. In the new DP, the FSI for commercial properties has been raised up to 5 in the island city, from the earlier 1.33. For suburbs, new FSI will be up to 2.5 and 5 for residential and commercial properties, respectively. The existing FSI for the two categories is 2 and 2.5, respectively.