Mint Explainer: Dharavi, the big test for Adani and Mumbai | News Bharat

In the heart of Mumbai lies Dharavi, Asia’s largest slum, housing thousands of small businesses and hundreds of thousands of people on more than 600 acres. The Maharashtra government has been fighting for decades to restore Dharavi as a planned mixed-use development with homes, offices and small industries. On Monday, the Adani group emerged as the top bidder in a global tender to redevelop the sprawling slum, adjacent to the Bandra-Kurla business hub and Mumbai airport. Dharavi holds on to the promise of being rebuilt as Shanghai reconstructed Lujiazui. For the Adani group, this is an opportunity to show the world its ability to execute, similar to how the Ambanis built the Jamnagar refinery.

Will Dharavi be another commercial hub in Mumbai?

Adani Group, the energy and infrastructure giant that spearheaded the bid, will resettle slum dwellers on railway land, opening up prime land for redevelopment. New commercial complexes may emerge, creating a third business district in Mumbai, beyond Nariman Point in central Mumbai and Bandra-Kurla Complex (BKC) in the suburbs. From housing offices of various industries to reserving space for the small industries already located in Dharavi, even to making it a financial services destination for the world, this opens up a world of opportunities for Mumbai and India. Adani bids 5,069 crores for 23,000 crore Dharavi Integrated Redevelopment Project. A committee of secretaries is expected to give the official green light to the project soon. A special purpose vehicle (SPV) will be created, with Adani holding a majority stake. The rehabilitation process should be completed in seven years and the project in 17 years.

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Will there be a Mumbai without slums?

The redevelopment of Dharavi is part of a larger goal to eventually make Mumbai slum-free. That would be a tall order. Almost half of the city’s population lives in densely populated slums, according to the World Bank. Many of these slums are located along railroad tracks and sidewalks and are deeply embedded in the fabric of the city. Providing free or affordable housing for all is a huge task. Mumbai authorities have tried almost every option over the years, from re-housing them in place, to moving them to outlying suburbs, to building market housing in poor areas, to cross-subsidizing replacement housing. Multilateral bodies such as the World Bank have often been consulted on the exercise. Still, progress is painfully slow, with sheer numbers overwhelming the system.

Dharavi’s small businesses will remain

Many slums have almost become a permanent feature of Mumbai’s landscape, creating mini business ecosystems. Dharavi has many informal small-scale industries, from medicine to footwear, clothing and leather. All commercial and industrial units will find space in the redeveloped Dharavi. Over the years, the standard of living in Mumbai’s slums has risen. The Multidimensional Poverty Index of the United Nations Development Program (UNDP) pegged India’s urban poverty levels at 5.5% in its recent report. The World Bank in 2018 estimated that 35% of India’s urban population lives in slums. Clearly, a large proportion of the urban population living in slums is not considered multidimensional poverty.

Learning from the Dharavi experience

Mumbai’s experience highlights the need for urban planning to prevent slums from sprouting up. Indian cities are growing at breakneck speed and becoming engines of economic growth; however, there is a complete lack of urban planning in large parts of India. In fact, many urban settlements are run as ‘rural’ units, a recent Niti Aayog report revealed. Random urban sprawl eats up valuable land resources – often fertile agricultural land – and is ecologically unsustainable. India needs compact cities and suburbs. China offers a lesson in urban planning, keeping its cities free of slums Over the decades, it has combined urban and rural development in the process of urbanization for the orderly expansion of its urban centers.

Dharavi: The big test for Gautam Adani

With a net worth of over $150 billion, Gautam Adani is now the third richest person in the world after Elon Musk and French fashion mogul Bernard Arnault. In recent years, his group has expanded rapidly into a variety of businesses, from airports and roads to renewable energy to defense and aerospace and media. Real estate is emerging as another port for the Adani group. It is also an opportunity for the group to demonstrate its execution prowess to the world and the stock markets. Slum redevelopment is a major challenge and meeting project deadlines and preventing cost overruns will remain a priority for the group. The Slum Rehabilitation Authority, set up by the Maharashtra government in 1995, has had an unremarkable track record so far, rehabilitating just over 200,000 families in over 2,000 projects. The Dharavi project may also test Adanis. Remember how the smooth execution of the Jamnagar refinery, the world’s largest, got the Ambanis worldwide recognition? The Dharavi project will be watched closely by the world and is an opportunity for Gautam Adani to make a strong statement about the professionalism and prowess of his group.

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