Financial Daily from THE HINDU group of publications
Monday, Nov 03, 2003
Columns - Vision 2020
Dwelling in malady
P. V. Indiresan
All these years, planners and administrators were complacent about urban development. Towns and cities were growing, and rapidly too. They took growth as good by itself, and as a sign of good health. However, growth can be due to obesity, to a cyst or even cancer. Urban growth has marks of all three, and is far from healthy.
These symptoms of urban illness have been observed for quite sometime. Even then, most persons ignored them as those affected were mostly the poor, and their misery was treated as God's Will. Now the virus has spread, and even the upper middle-class is subject to unbearable stress. Hence, the faith in God's Will has diminished, and attempts have begun to remedy the urban malady. Mumbai authorities, for instance, have brought in the global firm McKinsey to advise them about how to make life in their city more liveable.
As one would expect from a firm like McKinsey, its recommendations concentrate more on soft issues such as finance, economic growth and governance than on hard ones such as municipal amenities. They have, however, much to say on the problem of housing. Essentially, their recommendations are:
(a) increase the already high Floor Space Ratio even further, and
(b) convert abandoned industrial space into housing estates. They also advocate relaxation of prevailing Draconian rent control and housing regulations. They estimate that an investment of Rs 2,00,000 crore will be needed to implement their plan.
As that cost comes to Rs 150,000 per person, the McKinsey remedy is expensive indeed. As Mumbai is the richest city in India, it may be able to generate that much money. Nevertheless, the high-cost raises not merely economic issues but ethical ones too. If Mumbai were to be rewarded in this manner, should not every village be supported at the same rate, Rs 15 crore for every 1,000 persons? Villages cannot dream of even one-tenth of that per capita allotment. One would normally expect a rich city like Mumbai to help poorer habitations. Instead, apparently, it has to sponge on the poor to remedy its own folly.
Even if funds of this order are made available, will it suffice to cater to a population increase that is expected to touch 27 million? Will poor slum-dwellers be able to afford the houses so constructed? Will it eliminate the woes of the commuters? Will it at least make Mumbai a clean city?
The weakness of the McKinsey Report lies in the absence of technological innovation. It is true that the problems of cities such as Mumbai are mainly due to bad governance, and that good governance in the manner the Report suggests will improve matters. Yet, without technological change, no great progress can be expected. Technology may not solve problems of bad governance; yet, it is the only enabler. Without proper technology, good governance can achieve little.
The basic issues with cities such as Mumbai, Kolkata or Chennai are mainly the following: Can housing be made affordable? Will transport be sufficient? Will the city be cleanable? Can enough potable water be provided for all?
Housing is a tricky problem. If it is made attractive, the non-poor will take it over; raise its price so high that the poor will be forced into slums. Slum dwellers too create problems: It is not uncommon for them to sub-let any improved accommodation that may be offered to them, and squat somewhere else with the active connivance of professional slum lords. These distortions will be overcome when, and only when, the supply of housing exceeds demand.
Rent control artificially constraints supply. Long years ago, I had an opportunity to talk about this problem to Prof Dandavate, then minister in the Union cabinet. In those days, it was estimated that over a hundred thousand flats were locked up in Mumbai because owners were scared to let them out. I suggested to the minister that if the Draconian tenancy regulations were repealed, all those empty flats would come into the market.
That increased supply will reduce rents, and, a number of families living in inferior accommodation would move into the flats that are lying unoccupied, leaving behind their old flats which, in turn, would be taken up by less prosperous persons. In that manner, a domino effect would be introduced until a hundred thousand pavement dwellers move into (for them) luxurious juggies. Being a well-trained academic, he caught the argument immediately. However, as a committed socialist, he would not surrender his ideology that landlords are bad. So, he did not relent. That is the problem with ideological postures: Neither will they accept logic nor will they let ideas flourish. Let us hope that McKinsey will now succeed in convincing our politicians (and bureaucrats too) about the folly of our housing regulations.
Unfortunately, urban politics depends on the perpetuation of slums. Some years ago, I suggested to a reputed architect in Mumbai that multi-storey structures may be built on existing slums, part of that accommodation may be given free to existing slum dwellers, and the remainder to commercial interests who will bear the entire cost. He did organise financial support for such free and handsome accommodation in one of the slums but the scheme was shot down by the goondas of a powerful political party.
Typically, slum-dwellers have 15-20 sq. m. of land. Minimum reasonable accommodation for a family is about three times as large. Then, if 4-5 storey buildings are constructed in existing slums, existing slum-dwellers can be given free respectable housing of about 50 sq. m. and the remaining space given over for commercial use. The poor will then have civilised housing free and at no cost to the government.
There is, in addition, plenty of railway land. The entire space above the railway tracks remains unexploited. There is an amusing tale of an Indian businessman who set up shop in ancient China, and sought to buy some land. He was told that land can be purchased only by volume, up to a specified height only. That is, the landowner retained the right to sell the space above to other bidders. The Indian businessman did not like it at all, and, hence, purchased space up to ten feet height but built his house nine feet high! The railways are like that businessman. The space above the tracks and above the stations are invaluable, but the railways will not allow anyone to build on top. If only they have a change of heart, and let all their land to be built on, millions more can be accommodated.
The number of illiterates has been increasing in the country because the number of births exceeded the increase in enrolment in schools. Likewise, slum population will increase unless urban population growth is curtailed, and reduced below the rate at which new houses can come up. Further, not only should more houses be built but they should be cheap enough for the poor to afford, and at the same time, demand should be low enough not to exceed the numbers that can be built.
Fortunately, Kolkata is already stagnating, and Mumbai is growing slower than most other Indian cities, and even towns for that matter. Even then, unless new restrictions are imposed, metropolitan growth will exceed the pace at which new dwellings can be constructed.
This problem of relative growth is best tackled by invoking the Supreme Court's concern for good environment. It was the Supreme Court that forced all diesel buses in Delhi to use CNG. The Supreme Court has also ordered the closure of a number of industries in Delhi. Hence, it is more than likely that if any civic-minded group were to launch an appropriate Public Interest Litigation, the Supreme Court will direct the authorities not to allow further expansion of industrial and business activity in our metropolitan cities unless such expansion guarantees full municipal amenities to the employees. As politicians, builders, and bureaucrats too, have a vested interested in unlimited expansion, the Supreme Court appears to be our best hope to contain future expansion within tolerable limits. Thus, in the matter of housing, our cities need a three-pronged strategy: One, more houses should be built on existing slum property, and in other possible areas to house the existing homeless.
Two, business premises should be combined with such dwellings, on condition those businesses will cross subsidise dwellings, and thereby make housing affordable (or even free) for the poor. Three, the Supreme Court should be moved to halt further congestion and pollution of these cities except where housing for employees is guaranteed. In any case, urban growth should be kept lower than the pace of new house construction.
However, housing is only one of the maladies that our cities suffer from. We still need to tackle three other critical maladies: Cleanliness, transport and water supply.
(To be continued)
(The author is a former director, IIT Madras. Response may be sent to email@example.com)
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