The Delhi Master Plan 2021, and the consequent changes in land acquisition policy have elated both the farmers in rural areas of Delhi as well as owners of large chunks of land as the land pooling policy introduced by DDA has lead to a gradual increase in the price of agricultural land in the national capital. In last 2 years the price has almost doubled, and trebled in some areas giving farmers the option of monetizing their land by either selling it or participate in land pooling, and exploit it commercially.
While earlier the state government agency DDA used to acquire the land from farmers, and sold it to private builders but with the new policy, the situation has changed. Now the DDA, landowners and builders have to come together, and transfer the legal rights to a designated land pooling agency. This agency will then give certificates to the landowners that will entitle them developed land as per a formula devised by the agency. The interests of every stakeholder have been taken into account while deciding upon this formula, say government officials, and it is visible on the ground as landowners are showing great interest in land pooling. This is also because acquisition of land has become difficult, and the consent of 80 per cent landowners is required for private builders in an area, whereas it is 70 per cent in case of public private partnership. Also in view of opposition to land sale by farmers due to rising prices, it has been found that land-pooling could be a viable option.
With land acquisition becoming increasing expensive as the buyer has to pay twice the market price in urban areas, four times in rural areas, the land pooling concept is finding favour with both developers and agencies. The reason being that instead of paying cash, the owners are compensated through developed land or FSI which can be sold to a builder. Ramesh Menon, Director Certes Realty Ltd, a company having deep expertize in Delhi land aggregation and sales, is also bullish on the land pooling policy introduced by Delhi government as he feels that it will increase the supply of land, lead to new real estate projects, and thus moderate prices in Delhi. In his opinion, new supply in Delhi will also have moderating effect on prices in Gurgaon, Noida, and nearby areas as the land prices cool down gradually. Certes Realty Ltd which is one of the specialists in Delhi land and farmhouses having a large inventory in the national capital however feels that delay in development of projects could put a spanner in success of the land pooling policy. Menon opines that timely development has to take place to ensure that land prices, and value of FSI appreciates considerably.
To ensure this, the Delhi government is planning to give single window clearance to projects though it would not be an easy task due to involvement of multiple agencies. It is also being questioned as from where the government will raise funds to build infrastructure in the largely rural parts of Delhi which have seen little development. Experts at Certes Realty Ltd however feel that gradually the development process in Delhi will accelerate as there is paucity of housing in the National Capital, and despite Noida, and Gurgaon offering options people still love the Delhi address, and the unmatched civic services. The recent award to the National Capital branding it as the best city to live in India is an additional feather in Delhi’s cap.
While there may be challenges for both the government as well as developers but experts opine that in view of increasing land prices, there is no other option but land pooling to make viable urbanization possible in Delhi. Menon suggests that to avoid risks the small landowners, farmers could pool their land to a minimum level so that they are able to get developed land as compensation instead of getting FSI certificates. He also wants all the stakeholders to invest with a long term horizon as these projects will take atleast 5 years to materialize. However, those who want to get rich quick can sell the land now as the prices are all time high.
14th March 2014