The Sharad Pawar-led NCP, which has a firm political grip over this region, is believed to be upset with chief minister Prithviraj Chavan for staying it. Chavan ordered the urban development department to review the regulation 2(7) and is likely to drastically reduce this construction bonanza for private developers.
In Mumbai, rules allow a maximum FSI of 5 as compensation in the form of transfer of development rights (TDR) for builders who rehabilitate slum dwellers free of cost in new tenements on vacant land belonging to them. Top government sources said the largesse would benefit a few politically connected builders, who have accumulated large swathes of land in Kothrud and Kalyani Nagar in Pune.
FSI defines how much can be built on a plot. For instance, an FSI of 10 on a 1,000 sq m plot will allow a developer to build 10,000 sq m or ten times the area of the plot.
Political sources said the Pune FSI issue was one of the reasons for Pawar's broadside against Chavan last month. Without naming the CM, the NCP chief said he wasn't clearing files and was delaying decisions on crucial issues. "I don't know whether (his) hands are paralyzed when it comes to signing files. I hear there are files pending for three months," Pawar had said.
But Chavan hit back, stating his government's priority was to "take decisions which helped the common man" and not files which are "in the interest of individuals".
"The general consensus is that builders are being over-compensated for very little work,'' said a construction industry source based in Pune. Large tracts of public land in Pune reserved for public amenities are encroached by slum dwellers. The policy stipulates that builders rehabilitate these encroachers in new buildings on a portion of the plot free of cost and build apartments for free sale on the remaining land. On lands which are required for public purposes, the slum dwellers are accommodated in situ and the builders hand over the remaining area to the local authority to build a public facility. The local authority then grants TDR to the developer which can be used on any of his lands in addition to the FSI normally available on such lands.
As compensation, builders receive higher FSI to build on their own land, depending in which zone of the city it falls within.
For instance, developers' plots falling under zone C in Pune (comprising areas like Kothrud and Kalyani Nagar) receive the highest FSI of 10. Zone A (gaothans and peths) receive FSI 6 while zone B (Koregaon Park, Boat Club Road, Deccan Gym) could get FSI of 8.5.
"This regulation has been in the rulebook since 1994. No builder took advantage of it all these years because the transfer of development rates (TDR) in Pune were barely Rs 200 to Rs 500 a sq ft,'' said Pune municipal commissioner Mahesh Pathak. "But in the past few years TDR rates suddenly increased to Rs 2,000 to Rs 3,000 a sq ft, making it extremely lucrative. The government is considering reducing it because some felt it will lead to vulgar profits for builders,'' he added.
A few Congress MLAs are believed to have complained to Chavan about this unusually high bonanza, it is learned. "It would lead to rampant construction in areas where the civic infrastructure is lacking in terms of water supply and roads,'' said a housing expert.
Regulation 2(7) allows FSI 3 to rehabilitate slum dwellers on site.
Zone A: As compensation, builder receives FSI 7 on his land. For instance, if the rehabilitation component is 10 sq m of construction, then an additional 20sqm area will be permitted to builder to be sold in open market and the rehabilitation component subsidized
Zone-B: Builder will receive total FSI 8.5
If the rehabilitation component is 10sqm of construction, then additional 25sqm area will be permitted to builder for sale in open market
Zone-C & D: Builder will receive FSI 10
If rehabilitation component is 10sqm then additional 30sqm will be permitted to builder.
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