According to the Delhi Development Authority’s
(DDA) recently passed land pooling policy, private developers may
directly acquire land from farmers/landowners willing to participate in
the land pooling scheme (LPS), where they will get back 40-60 per cent
of the developed land, instead of any compensation. DDA, in turn, will
develop the necessary support infrastructure and mass/EWS housing
projects on the land, while developers will receive a large portion of
the same for further real estate development. The land pooling policy
will prove to be positive for the National Capital Region (NCR) in the
long-term, since land prices in the suburban markets of Gurgaon and
Noida would eventually rationalise with fresh supply coming into the
Delhi market.
Meanwhile, certain peripheral locations of Delhi with large land
parcels-along the NH-1, North Delhi (Akbarpur, Mazra), North West Delhi
(Rohini, Narela), West Delhi (Najafgarh, Dwarka), and areas of South
Delhi (Masoodpur, Kishangarh, Chhatarpur, etc.) — have been witnessing
price rises to the tune of two to three times over the course of about
six quarters. Experts believe this to be a short-term trend, however,
which is likely to rationalise once more supply of developable land
comes into the realty market.
Land pooling in India
Land acquisition is a contentious subject in India. Quite apart from
the challenges of acquiring clear and litigation-free titles to
suitably-sized, contiguous land parcels for real estate development — it
is a politically-sensitive issue in many parts of the country. In these
times of increasing scarcity of space in urban India, open spaces
demand a premium. As developers go vertical to maximise their space
utilisation, realty projects requiring horizontal development — such as
township projects, industrial corridors, and large-scale regional
infrastructure development projects — face challenges primarily arising
from hassle-free acquisition of adequate land.
Under the present land acquisition system, in case of private entity
enterprises, freehold (state-owned and privately-owned) as well as
leasehold (state-owned) land requires the consent of 80 per cent of the
affected land-owning family; and the consent of 70 per cent in case of
public-private partnerships (PPP). Moreover, compensation of up to four
times the market value in rural areas and twice the market value in
urban areas is also required; apart from a rehabilitation and
resettlement package for the original inhabitants. In many cases the
only way in which developers are able to circumvent such complexities is
via land pooling.
As a method for assembling land for planning and development, the
Town Planning Scheme (TPS) —also known as the Land Pooling Scheme (LPS) —
is included in the Urban Development Plan Formulation and
Implementation (UDPFI) guidelines of the Ministry of Urban Development
and Poverty Alleviation. In fact, the Model Urban and Regional Planning
and Development Law contains a separate section on LPS, where it
proposes that planning and development authorities should prepare land
pooling schemes for town planning areas under its jurisdiction.
Gujarat & Maharashtra models
The very first TPS in India was probably put into practice in 1917
for the Jamalpur area of Ahmedabad, Gujarat, following the Bombay Town
Planning Act, 1915, which provided for the implementation of Town
Planning Schemes. The TPS practice, which is extensively used in
Gujarat, allows local planning authorities to develop commonly pooled
land without compulsorily acquiring it. The process involves a joint
venture between the local/metropolitan development authority and land
owners, who voluntarily pool their land, redistribute it as plots among
themselves after the planning process, and share the development cost.
The most successful land pooling case study of recent times is probably
that of the Magarpatta Township Development and Construction Company
Limited (MTDCCL). More than 400 acres of land belonging to over a 100
farmer families was pooled together to create the integrated township of
Magarpatta City in Pune. This development was envisioned as an
integrated planned township with commercial zones (including IT parks),
residential zones, and social infrastructure like schools, hospitals,
shopping centers, hospitality and entertainment areas.
Following such successful models in Maharashtra and Gujarat, other
state governments, like Tamil Nadu and Andhra Pradesh have also started
considering such implementation policies for preparing comprehensive
regional plans — particularly for addressing problems arising out of
disconnected development along suburban/peripheral zones of major
metropolitan centers, industrial corridors and large township
development.
Upcoming plans
The Hyderabad Metropolitan Development Authority (HMDA) has recently
proposed land pooling for approximately 250 acres within a
kilometer-wide belt on either side of the Growth Corridor abutting the
Outer Ring Road. In case the landowners agree to become partners in the
development of the area, it is likely to be taken up as a pilot project.
If successful, it will serve as a road map for future land pooling
schemes for similar urbanization projects in the city. Similar
initiatives include that of the Delhi Development Authority (DDA), which
has recently passed a modified land pooling policy within the Master
Plan Delhi 2021 (MPD 2021). DDA has identified approximately 200
villages along the outskirts of Delhi for this LPS. It intends to
convert around 90 villages into ‘development areas’, and about another
90 into ‘urban villages’. All such identified village areas are together
likely to free up more than 70,000 acres of developable land in the
NCR.
The Delhi MPD 2021 is arguably the largest real estate opportunity in
terms of state assurance and demographic demand for urban growth and
development in the country. And the recently sanctioned land pooling
policy is perhaps the first of many such state initiatives. Such Land
Pooling Schemes will help solve issues related to the availability of
land for necessary real estate development and infrastructure formation
for India’s ever-increasing urban population-especially for the creation
of urban green spaces, open public spaces and mass housing for EWS and
low-income groups. There are as yet vast growth opportunities in the
country’s realty sector. Especially where urbanisation and related
large-scale infrastructure is concerned —India is yet to experience the
full extent of population migrations to its established urban cores,
which will put pressure on the existing urban infrastructure and mass
housing.http://www.indianrealtynews.com/real-estate-india/fresh-supply-to-rationalise-land-prices.html