By IANS
Nagpur/Mumbai : The Maharashtra government Thursday scrapped a law that regulates holding of urban land, a move that is likely to free large tracts of prime land in India’s financial capital Mumbai and other cities.
Authorities hope the scrapping of the three-decade-old law, the Urban Land Ceiling Regulation Act (Ulcra), will reign in the burgeoning real estate prices and make housing more affordable for millions of middleclass families.
Mumbai had Monday witnessed a record selling price at the suburban high-tech hub of Bandra Kurla Complex when a private developer bagged a 7,107 sq mt plot for a mind boggling Rs.8.31 billion, which works out to Rs.46,883 per sq ft.
The Ulcra was passed by the Indian government in 1976 to prevent land hoarding, but land scarcity fuelled high real estate prices which forced the law to be scrapped in 1999. Maharashtra had not repealed the act.
“The act was repealed by the state legislature Thursday by a voice vote at its winter session,” Nawab Malik, a Nationalist Congress Party legislator, said.
Private builders and developers in Mumbai eagerly anticipating the repeal of the act said that large tracts of vacant land in the island metropolis, where real estate prices either match or in many cases overtake those in New York and Tokyo, will now be up for grabs.
Those opposed to the land ceiling act say that freeing up land would make way for not only commercial redevelopment but also crucial infrastructure, lack of which is holding back Mumbai from becoming a world-class city.
“The move by the Maharashtra government by scrapping the law, shows that they are serious in making Mumbai into a world-class city. We welcome the move,” said Pujit Agarwal, spokesperson of Mumbai’s property redevelopment association.
“Over 25,000 hectares of land in the megapolis will be freed up. Besides, thousands of hectares of land will be available for development in other crowded cities like Pune and Nagpur where there is a high demand for residential complexes and office spaces,” Agarwal said.
But supporters of the law, namely the communists, said the move would only help builders make money without benefiting the common man.
“The state government could have easily acquired 100,000 acres of land under the Ulcra. However, it chose to look the other way to facilitate builders and corporate houses,” said a Communist Party of India-Marxist legislator Narasyya Adam.
Officials however, argue that prices of houses will come down in the post-Ulcra era.
“Once free for development, the government is likely to reserve 50 percent of the land for low-cost housing,” an official said.
In the state legislature, Chief Minister Vilasrao Deshmukh sought to allay fears that housing would be unaffordable for the common man in Mumbai after scrapping the act.
“The government will bring provisions to levy penal tax on vacant lands that would be released after the repeal of the Ulcra and compel builders to construct houses of 40, 60 and 80 sq mt area, thus creating a housing stock for the common man”, he said.
Pointing out that thousands of acres of surplus land in Mumbai owned by big business houses like Godrej, Wadia and Behramji has remained locked in litigation in the Supreme Court for the last 30 years, Deshmukh said the government cannot wait indefinitely to get the land released.
He admitted that out of 60,854 hectares of surplus land in nine urban agglomerates in the state, the government could take possession of only 14,624 hectares.
He also admitted that acquisition of surplus land in urban agglomerates in smaller cities like Nagpur, Kolhapur, Solapur and Sangli virtually amounted to cheating the poor, ignorant farmers while influential people managed to retain their lands.
Among those who spoke against the resolution were Leader of Opposition Ramdas Kadam, former speaker Datta Nalawade, Subhash Desai and Gajanan Kirtikar (all Shiv Sena) apart from Narsaiyya Adam of CPI-M.
While Subhash Desai doubted the government’s ability to utilize the released land for affordable housing since big builders have already grabbed it from its owners through power of attorney, Adam flayed the government’s “feigned inability” to get 65,000 acres of surplus land (locked in litigation) in Mumbai in 30 long years.
While Shiv Sena opposed the resolution, its partner Bharatiya Janata Party supported it. The resolution is likely to be passed in the Legislative Council Friday.