What's the Worth of a Salt Pan?

Thousands of crores if you live in Mumbai

The story so far: Adani Realty has won the right to redevelop Dharavi. The Maharashtra government has approved handing over 255.9 acres of salt pan land in the eastern suburbs of Mumbai to Adani Realty. This has massive environmental repercussions. Read the whole story here.

Dharavi: Land and People

Dharavi is India’s largest slum. It is comprised of 594 acres. It is prime real estate land in Mumbai and is connected to BKC (Mumbai’s most prosperous financial hub), Kurla, Sion, Matunga, Bandra, and Mahim. Naturally, real estate builders want a slice, or all, of this area. The challenge: Dharavi is home to potters, leather tanners, artisans, and embroidery workers whose families have migrated here since the 1800s when Dharavi was nothing but swamp land and marshes.

Since 2004, successive Maharashtra governments have been trying to redevelop Dharavi but have run into challenges. In 2018, the government issued a seven-year redevelopment tender via a 20% government, 80% privately held arrangement. Dubai's SecLink consortium and India's Adani Group were among the bidders.

SecLink bid ₹7,200 crore, while Adani Realty bid ₹4,539 crore. SecLink won, but in 2020, the Maharashtra government canceled the tender because, according to Reuters, “acquisition of certain land for the project altered costs after the bidding process ended.”

Tenders were reopened and Adani won with a bid of ₹5,069 crore (if costs were altered, SecLink’s bid was still more than Adani’s). SecLink didn’t participate in the process.

SecLink’s Plan vs Adani’s Plan

According to The Frontline, “In its 2018 bid, Seclink offered to redevelop Dharavi with complete rehabilitation of all the tenements on 254 ha. It had a plan to rehabilitate all slum dwellers and commercial establishments on 200 acres, with 100 acres earmarked for gardens; 300 acres were planned to be used for buildings for sale. Seclink offered 350 square feet of housing to all the residents of Dharavi. DRPPL’s [ADANI REALTY] plans are in sharp contrast with this.

According to conditions in the new tender, there will be eligible and ineligible categories of tenements. The eligible tenements will comprise those mapped in Mashal’s survey, about 81,000 of them, although DRPPL maintains that there are only about 64,000. This includes residential and commercial tenements in slums and chawls.

Classifying many tenements as ineligible means that some seven lakh people residing on the mezzanine and upper floors in slum structures will now get rental houses or permanent ones outside Dharavi. According to the tender document, ineligible residents must be accommodated in the MMR under the Prime Minister Awas Yojana (PMAY), or the affordable housing scheme. By bringing this new clause into the tender, the State government appears to have complicated the issue.”

Redevelopment or Land Accumulation?

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Adani Realty claims that as many as 7 lakh people live in the mezzanine or upper floors in Dharavi. To rehabilitate them, it needs 23 more parcels of land in Mumbai—an extra 552 acres. It has asked the government for land totaling up to 1,250 acres (Dharavi + extra land).

Think about it: Dharavi residents right now stay on 600 acres, but rehabilitation requires double that amount. These land parcels, according to The Indian Express, include “21 acres in Mother Dairy Kurla, 200 acres in Deonar, 250 acres of salt pan land in Bhandup-Kanjurmarg, and 64 acres in Mulund owned by the BMC.”

An opinion piece in The Week says the land breakup is as follows: The total area of the Dharavi Redevelopment Project is 550 acres, and Adani's demand for this project is as follows outside Dharavi: 1. Railway: 45 acres, 2. Mulund Zakat Naka: 18 acres, 3. Mulund Dumping Ground: 46 acres, 4. Mithagare: 283 acres, 5. Mankhurd Dumping Ground: 823 acres, 6. G Block BKC: 17 acres, 7. Mother Dairy Kurla: 21 acres, Total: 1,253 acres.

The Frontline article says, “Since the project has been deemed a vital public project and since Dharavi is a special pocket under the SRA, the extent of possible saleable area by the Adani Group is a mind-boggling 7.86 crore sq ft.” (For every 350 sq ft unit Adani builds in Dharavi, it can sell up to 628 sq ft of commercial property). The average price of a property in BKC is ₹45,000 a sq ft. Expect Dharavi prices to be around the same.

The Maharashtra government has already okayed the salt pan land. RTI activist Sagar Deore said, “Any developer working on any project anywhere in Mumbai will first have to acquire Transfer Development Rights from DRPPL. In a way, this hands over control over all of the development in the city to the Adani Group.”

In short, when any builder in Mumbai wants to build in the future, they have to get land from Adani.

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So long!

Team Reading Room