By: Ravi Sinha
Track2Realty Exclusive: For quite some time the developers in Mumbai were making pitch for the review of FSI in the city which they termed as archaic. Their grouse has not been lacking the merit also. Facts speak for themselves. In 1964, FSI was introduced and set at 4.5 in Mumbai. While FSI is progressively relaxed in most global cities, in Mumbai the experience has been the reverse. FSI was reduced to 1.33 in 1991. The city has one of the lowest FSI and floor space per person in the world.
Urban planning experts maintain that FSI below 5 spells disaster for any mega city like Mumbai. The developers have been asking to be increased as much it can be, or removal of FSI norms just like Andhra Pradesh as a much better option. About 50 per cent of population in Mumbai stays in slums. Also about 84 per cent of homeless people are self-employed and contribute towards the economic growth. Since they live close to their workplaces and are an integral part of the India’s urbanisation story, irrespective of the location categories we need to create affordable housing even in the premium locations of mega cities.
What has added fuel to the fire of relaxed FSI norms is that now even the Union minister Housing and Poverty Alleviation Ajay Maken has made a strong pitch for a review of floor space index (FSI) policy of mega cities including Mumbai for encouraging the affordable housing. Maken believes this can be one of the solutions to tackle increasing urban development challenges.
“There is a need to review FSI policy and make appropriate changes to boost the affordable housing in Mumbai. The State is the responsible authority to do so and in our opinion it should consider this option. The policy for providing ‘Infrastructure Status’ to the affordable housing scheme is on the cards to improve the urban housing scenario. This can be treated as a sub sector of real estate and at least, this sub sector can be given the infrastructure status,” Maken said in his address at the international meet on “Governance of Mega City Regions” organised by the Confederation of Indian Industry (CII) in partnership with Centre for Policy Research (CPR) in Mumbai.
Welcoming the stand of the Union Housing Minister, Lalit Kumar Jain, National President of CREDAI says Ajay Maken who has understood issues of urbanisation has given out his view and from his statement it is clear that he understands the need of FSI relaxation. Now, it is state government’s turn to understand the condition of overcrowded Mumbai and the situation of thousands of homeless Mumbai dwellers.
“We hope that the Maharashtra government takes note of the minister’s suggestion to hike Floor Space Index (FSI) to encourage affordable, mass housing for slum dwellers as well in premium locations. Affordable housing is the need of the hour, and for this, FSI policy should be reviewed. In cities like Mumbai where population is growing day by day, vertical growth is the only option. If the FSI policy is revised then mega cities like Mumbai and Bangalore will have vertical residential development. This will lead to development of residential projects at a comparatively lesser cost, and buyers will get homes at good rates,” says Jain.
Manoj John, VP, Corporate Planning & Strategy, RNA Corps also maintains there is a correlation between cost of FSI and the nature of development that is viable given the high cost of land with limited development potential. If more can be built on the same land, the cost of land attributable to the project, which is as high has 50 to 80 per cent of project cost would come down. Hence, it would be viable for the developer to build residential projects at lower cost and hence make it more affordable.
“In a city like Mumbai affordable housing is ticket size of 25 to 50 lacs, and EWS housing is 10 to 25 lacs. I believe that if the cost of FSI can come down to one-fourth of what it is today, then it is viable for developers to build houses within city limits that can be sold for about 4000 to 5000 psf. Today these rates exist in locations 30 to 40 kms away from the city,” says John.
However, Devang Varma, Director, Omkar Realtors & Developers has a caveat here. He says more often than not, the relaxations end up being exploited rather than put to good use like affordable housing. According to him, FSI relaxation is not likely since existing infrastructure is a major issue. Enhancement of infrastructure also looks to be a bleak possibility owing to Mumbai being already highly congested with higher possibility of inconveniencing the system more.
“There is nothing like ideal FSI. FSI is essentially a co-related function of population and the required infrastructure. With the current population of Mumbai one can see the current scenario which can be aptly described as Chaotic and nothing less. Hence, in a way FSI norms may not fall in the category of archaic with amendments already having been made vis-à-vis prevailing situations. No further increase in FSI can be and should be fathomed since that would lead to further degradation of life in Mumbai,” says Varma.
There is also a school of thought that people should be encouraged to move out to MMR regions by increasing FSI in MMR regions and enhancing infrastructure over there or encouraging township schemes. A status quo is alarming as Mumbai which had an average FSI of 5 which over a period of time got reduced to 1.33 & 1. Lack of vision, concern of public good and scientific approach towards urban planning resulted in ignorance over the issue by the respective governments.
Now the government seems to be scared to take bold decisions as they may be blamed for being pro-builder policies. Since the majority of land available for development is with central, state and local governments, what government needs is to show a political will and take some steps in decongesting the city and creating more housing stock, within or outside the main city may depend on the policy framework .
Ajay Maken’s wishful statement has not been responded by the State Government so far. Urban planning experts also understand FSI relaxation is not as easy as making a statement at the conference. Real estate may also not be unanimous over the ways & means of FSI relaxation or the shape of things to emerge in overall infrastructure development in Mumbai, but Union Minister for Housing & Poverty Alleviation has definitely set the tone for a debate on an issue which the sector always keeps pushing through its channel of policy advocacy.
