REDEVELOPMENT: THE FUTURE OF MUMBAI'S REALTY SKYLINE

In a city where land available for construction is becoming lesser with each passing day and old buildings are crumbling under the weight of age and neglect, redeveloping old buildings is the only way ahead, writes VIBHA SINGH

    Five years ago, the redevelopment of Mumbai was on the priority list of government policies. After all, cities remain vibrant if people inhabiting them are enthusiastic about living in those cities. You cannot expect people to exude zest when most buildings in the city are crumbling. The other problem the city faces is that there is no fresh land for development. Hence, the state government is now focused on redeveloping the existing old buildings. However, for one reason or the other, this has not been happening despite the initial euphoria five years ago. Sunil Mantri, president, National Real Estate Development Council (NAREDCO), explains that "The city of Mumbai, as we know, is centuries old. As a result of its sporadic growth and its rich culture and history, it has developed in an adhoc manner with no concrete town planning. It has pockets of affluent residences standing back-to-back, with large tracts of mass dwelling units or slums. There are also numerous dilapidated buildings that pose a risk to the lives of  its residents. So, while Mumbai's skyline is a pretty picture, there is much that can be done to give Mumbai a face-lift." 
    In Mumbai, over two million people live in 19,672 dilapidated buildings in south Mumbai, with about 70 per cent residing in one-room tenements. Logically, these buildings should be slated for redevelopment without any delay. Amit Kulkarni, director, Varasiddhi Infrastructure, stressing on the need for redevelopment says that "Mumbai city expanded rapidly into the suburbs and beyond, post the 1960s and 1970s. The buildings that were constructed back then, are obviously in a dilapidated condition, most of which are cases fit for reconstruction or redevelopment. There is hardly any open land left in Mumbai where one can think of any green field project; the only option left is brown field or redevelopment of the property." 
    Of these available options, redevelopment of dilapidated buildings has the potential to unlock maximum land for infrastructure and real estate development. Hariprakash Pandey, vice-president, finance and investor relations at HDIL, explains how, "The city is long and less wide, with an extensive coastline. Unlike other cosmopolitan metros of the world, the major airports are located in the centre of Mumbai, causing massive congestion. There are mangroves on the eastern parts of the city, and due to environmental reasons, those plots have not been opened up for construction. Lack of an affordable housing policy has resulted in more occupation of government lands and build-up of slums on these lands. All these factors have limited the availability of potentially usable land and restricted developmental activities in the available land, due to more environmental and civic regulations." As there is a severe limitation in getting land for development, redevelopment is the only available option. 
    Redevelopment of dilapidated buildings, slums and old mills, are the only alternatives. Anuj Puri, chairman and country head, Jones Lang LaSalle India, explains that "Redevelopment, as a method of urban renewal, may involve relocating businesses and people. It must produce tangible economic benefits so that the trouble and expense of redevelopment is justified. If used correctly, redevelopment can be an economic engine that provides additional and better quality housing, helps in boosting property values, creates jobs, expands business opportunities, eliminates urban decay and improves infrastructure. Other potential benefits of redevelopment are reduced urban sprawl, improved economic competitiveness of a city's centre and better opportunities for safety and surveillance." 
    The other advantages of redevelopment of a slum or a dilapidated building are that it results in free, safe and high-quality housing with good sanitary facilities for the economically weaker sections. Redevelopment decongests the city and makes it look young and beautiful. During the last 23 years, there are only 1,600 chawls that have been redeveloped. There are about 5,00,000 more units that need to be redeveloped. At that pace, it will take close to 200 years to redevelop Mumbai. There are some issues involved in redevelopment, Mantri points out. "However, laws of the land make it difficult for any such action. Redevelopers have to provide the occupants with self-contained apartments of 300 sq ft each, and after that, recover the costs and generate margins through additional construction which can be a maximum of 50 per cent above the FSI awarded to the beneficiary occupants. This becomes very impractical at the current FSI levels, considering the expenses involved in rehabilitation. In addition, the law requires the developer to acquire the consent of least 70 per cent owners and tenants in order to undertake redevelopment. This is also a tall order and could take time. Meanwhile, the owners, tenants, are at risk as development proceeds at a snail's pace due to the current laws," he adds. 
    To ease the process, the Maharashtra government has announced some changes in the cluster redevelopment policy. Maharashtra chief minister, Prithviraj Chavan has announced the modified set of development control rules or DCR announced by the State Urban Development Authority for the Greater Mumbai region. The new rules now allow developers to pursue reconstruction/redevelopment of any building that has been around for more than 30 years. Also, consent from only 70 per cent of the landlords is now needed to begin a project, instead of the earlier 100 per cent, but parties that do not consent will have to be given adequate compensation. Kulkarni feels that the "Government has understood the importance of the matter and has proposed new schemes to take care of the redevelopment schemes across Mumbai, under different norms such as 33/7, 33/9, 33/5 and 33/10. In the next five to ten years, we will see a boom in the redevelopment sector." 
    Explaining the situation at hand, Mantri says, "If the policy environment is right, there are a number of developers catering to all economic strata of the residents of Mumbai, who are waiting in the wings to undertake redevelopment. However, in order to get it right this time, the recommendations of all stakeholders must be taken into account so that the policy that emerges is optimal and maximises benefits for all concerned and the city of Mumbai at large." 
    Puri does put in a word of caution though. "Redevelopment sometimes involves the use of eminent domain as a legal instrument to take private property for city-initiated development projects. This is sometimes seen as a means for regulatory bodies to acquire control on behalf of influential developers or developer cartels. If carried out in a non-consultative manner, redevelopment can result in an excess of high rises that compromise existing infrastructure, reduce the possibility of new infrastructure and increase the crime rate in a location. In order to be genuinely democratic, the process of redevelopment must be consultative at all levels. It should enable local citizens to have greater control and ownership of the direction of their community." Community participation, sustainability and trust, are important watchwords. The government must act as an advocate and an 'enabler', rather than as an agency that enforces command and control. 
    Finally, redevelopment should not be only about improving existing structure. There should also be a focus on incorporating historic structures into new and rehabilitated development. In cities like Mumbai, it is important to preserve and enhance cultural, historical and community assets. The cultural fabric of the community must not be compromised.

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IF USED CORRECTLY, REDEVELOPMENT CAN BE AN ECONOMIC ENGINE THAT PROVIDES ADDITIONAL AND BETTER QUALITY HOUSING, HELPS IN BOOSTING PROPERTY VALUES, CREATES JOBS, EXPANDS BUSINESS OPPORTUNITIES, ELIMINATES URBAN DECAY AND IMPROVES INFRASTRUCTURE.

File FIR on 'gas price collusion' by ministers, RIL: Kejri to cops Mukesh Ambani, Moily, Deora Among Those Named

New Delhi: In a sudden move that has jolted the political and business establishments, the Arvind Kejriwal-led Delhi government on Tuesday directed its anti-corruption branch to file an FIR against oil minister Veerappa Moily, former oil minister Murli Deora, Reliance Industries Ltd boss Mukesh Ambani and the former director-general hydrocarbons V K Sibal under the Prevention of Corruption Act for hatching a “conspiracy” to double gas prices in order to benefit, in the main, RIL.      In a brief press conference in the morning, the Delhi CM announced this while describing the details mentioned in a complaint received by the Delhi government as “shocking” and “an assault on India’s economic sovereignty which amounted to anti-national activity”. He demanded that the central government put price hike of gas in abeyance till the time the probe into the matter is completed.      “We have always said that price rise and inflation are linked to corruption and this is an example. In case this price increase is allowed to take place, it will make the life of the common man miserable,” Kejriwal said.      The Delhi government’s intervention in this matter, against which a PIL is still pending in Supreme Court, raised eyebrows with experts questioning the local government’s jurisdiction.  Kejri doesn’t know how it works: Moily      Oil minister Veerappa Moily hit back at allegations made by CM Kejriwal, saying pricing of petroleum products was done as per expert advice. “I should sympathize with his ignorance. He should know how the government functions.”P 12  Charges baseless, shocking: RIL      Terming the move to register an FIR as “shocking”, RIL denied the charges and said it would pursue legal remedies. “The complaint and allegations are completely baseless and devoid of any merit or substance,” it said. P 13 AAP trains guns on Modi-Adani links      AAP leader Yogendra Yadav attacked Narendra Modi. “What is the exact relationship between Modi and the Adani Group? How has Adani become super rich in just 10 years? Why are BJP, Modi silent on gas pricing scam by Congress?”P 10 Kejriwal: AAP has powers as ‘offence’ committed in Delhi      Kejriwal claimed as the “offence” had taken place in the jurisdiction of Delhi it was well within the Delhi government’s powers to proceed against it.      The decision to order a probe, said Kejriwal, was taken after it received a complaint filed by former cabinet secretary T S R Subramanian, former Navy chief R H Tahiliani, former expenditure secretary E A S Sarma and Supreme Court lawyer Kamini Jaiswal.      The complaint pointed out that gas prices would be doubled from April 1 due to the alleged “active collusion” between RIL and some central ministers. In case this price hike is allowed, it would have a cascading effect on transport, domestic gas and electricity prices, thus affecting the common man.      Kejriwal claimed the impact of the hike would cost the country a minimum of Rs 54,500 crore every year, and in addition to this, he said, the central government had allowed RIL to make a future windfall profit of Rs 1.2 lakh crore by gold-plating its project.      In a press release, the Delhi government said that since the term of the UPA government was ending in four months, it should have left the decision to the next government and “this hurry shows a malafide intention of helping” RIL.      It claimed that the decision to hike the gas price from the existing $4.2 (Rs 262.25) per mmbtu (one million British Thermal Unit) to $8.4 (Rs 524.20) per mmbtu would make gas prices in India among the highest in the world. It also claimed that there was no attempt to determine the cost of production independently and accurately. There was also no explanation as to why when the entire domestic production is to be consumed internally, prices are being fixed in US dollars. The fluctuation in dollar rate will only lead to a further increase in gas prices.      Charging the UPA government with collusion with RIL, the statement said the Centre took no action against RIL for its deliberate drop in production and ignored the CAG report and the then solicitor general’s opinion (in May 2012), and on the contrary, accepted RIL's demand for doubling gas prices from April 1 this year.      The AAP government said that even if the Centre’s argument that new prices would bring in more investment in exploration were to be accepted, there was no justification for raising gas prices from existing fields. “The central government (particularly petroleum ministry) has connived with RIL to help it in making a windfall profit at the cost of common man,” it said. Kejriwal claimed that the cost of production of gas was less than $2.34 per mmbtu.      “The fact that RIL had signed long term agreements with NTPC and RNRL for supplying gas at that rate for 17 years would show it was making profits at that price. RIL’s partner NIKO has a 25 year contract with the Bangladesh government to supply gas at the rate of $ 2.34/ mmbtu,” he said.      “A letter from RIL to the director general hydrocarbons giving its cost calculations shows the cost of production is less than $1 per mmbtu. Then why did it seek a hike in gas prices and why did the central government agree to it?” he asked.

India faces US trade action over patents

New Delhi/Washington: The US, which recently downgraded the DGCA’s safety ratings, is expected to announce traderelated measures in what is seen as a retaliatory move against India’s recent stand on the patent regime.      The US Trade Representative announcement will come aday after the US Chamber filed a submission to the USTR on the Special 301 Report. The Special 301 Report is an annual report on the adequacy and protection of intellectual property in various countries.      Drug MNCs have been lobbying with Washington for retaliatory action against India over the special provisions in the patents law that require the patent holder to prove a genuine invention has been made and the matter in question is not a mere upgradation of an existing product. P 15  TIT FOR TAT?  US set to announce traderelated measures against India  The move has been prompted by drug majors pushing for retaliatory action over India’s patent regime  Citing local norms, India has denied rights to some medicines that US firms had sought patents for  The development comes within days of US downgrading DGCA’s safety ratings and the Devyani Khobragade row

Hyderabad-Born, Manipal-Educated Satya Nadella Named Microsoft CEO INDIA MAKES A POWER POINT

Faces Challenge Of Steering Tech Giant In New Era

Washington: Microsoft’s board on Tuesday named Hyderabad-born Satya Nadella as chief executive of the legendary tech giant that has given the world products which have become household names like Windows, Word, Excel, PowerPoint and Outlook Express. The announcement elevates Nadella, an offspring of the Indian system, to one of the highest-profile corporate jobs globally. 
    Nadella, 46, will be only the third CEO of Microsoft after founder Bill Gates and Steve Ballmer, the man he is succeeding. 
    The elevation of Nadella, a company insider for 22 years (he recently joked that he has also been married for 22 years), was expected once heavyweight outsiders like Ford’s Alan Mulally and Nokia’s Stephen Elop dropped out or were passed up. The names of Google’s Sundar Pichai and Motorola’s previous CEO Sanjay Jha also briefly made the rounds, serving to highlight the intensity of PIOs breaking the glass ceiling, something that began some two decades ago, but has become more pronounced now. 
    In picking Nadella, Microsoft directors selected both an insider and an engineer. It has often been noted that Microsoft was more successful under the leadership of Gates, a programmer and its first chief executive, than it was under Ballmer, who had a background in sales. 
    Nadella now finds himself heading an icon of American business that has struggled for position in big growth markets like mobile and Internet search. The company has correctly anticipated many of the biggest changes in technology—the rise of smartphones and tablet computers, to use two examples—but it has often fumbled the execution of products developed to capitalize on those changes. WITH INPUTS FROM NYT & AGENCIES Gates quits as MS chairman 
    Bill Gates is giving up his role as chairman of Microsoft to become technology advisor to CEO Satya Nadella, supporting him in shaping the future of the company. John Thompson, who was formerly the lead director, will be the new chairman. 
‘DEFINED BY FAMILY, CURIOSITY & HUNGER FOR KNOWLEDGE’ 
    Satya Nadella, 46, becomes world’s topranked CEO of Indian origin, well ahead of Pepsico’s Indra Nooyi (on all parameters) 
    The 22-year Microsoft insider was executive VP, heading the company’s $20bn cloud & enterprise group. He earlier worked in Windows, Office, Dynamics & Bing groups 
    His father, B N Yugandhar, a 1962-cadre IAS, was then PM P V Narasimha Rao’s special secy and later Planning Commission member 
    Studied at Hyderabad Public School, Begumpet. Played in the school cricket team 
    Did BE from Manipal Institute of Technology; MS in computer science and an MBA in the US 
    Wife Anupama is also an HPS alumnus and studied engineering in Manipal. Her father K R Venugopal was Yugandhar’s batchmate in IAS and served as secy to Narasimha Rao. He launched the 2/kg rice scheme in Andhra Pradesh under N T Rama Rao 
    Nadella joined Microsoft in 1992. The company, founded in April 1975, was once the most valuable in the world. It’s blockbuster products, MS-DOS, Windows and Office made it so powerful it faced antitrust action. But it has lost ground to Google and Apple. Still, it remains the world’s 4th largest company by market cap 
WHY MS CHOSE HIM 
    Understands the crucial cloud computing segment and the importance of delivering more technology as a service. A hardcore techie, he fulfils requirement listed by Gates that the new leader must have “a lot of comfort in leading a highly technical organization.” 
    Played variety of roles, understands how the 132,000-people behemoth works. Collaborative, low-key, well-liked within MS and the industry. His lack of experience in the consumer space could be a weakness, but can be addressed by Gates’ move to become his technical advisor 
CHALLENGES 
    Needs to stem erosion of PC-centric Windows and Office franchises, and challenge Apple and Google in mobile computing. More than 90% of PCs run Windows, but only 4% of smartphones do, and an even smaller slice of tabletsNadella’s star rose in MS cloud computing division 
    It remains to be seen whether Nadella’s technical background, along with the closer involvement of Gates in product decisions, will give the company an edge it lacked during the Ballmer years. Microsoft said in a statement that Gates will “devote more time to the company, supporting Nadella in shaping technology and product direction.” 
    Relinquishing his role as chairman will allow Gates to spend over a third of his time with product groups at Microsoft, “substantially increasing my time at the company,” he said in a video made for the news of Nadella’s selection. Gates said Nadella asked him to make the change in his duties at Microsoft. 
    Nadella is a contrast to Ballmer in other ways. Most recently the executive vice president of Microsoft’s cloud and enterprise businesses, Nadella peppers his conversations and speeches with technical buzzwords that people outside the industry would most likely find impenetrable. 
    Nadella showed ambition early in his career. He received degrees in engineering and computer science, then earned an MBA from the University of Chicago Booth School of Business while working full time at Microsoft. He flew to Chicago from Seattle to attend classes on the weekend, according to Steven Kaplan, a professor at the school who taught Nadella in a course on entrepreneurial finance and private equity. 
    “He is take charge, smart, but in a likable way,” Kaplan said, adding that Nadella received an A in the course. 
    While many executives within Microsoft tend to be polarizing figures, Nadella appears to be well liked in much of the company. Still, those who know him well say he is not a pushover as a boss. 
    Nadella’s star at Microsoft rose considerably in the past several years as he took charge of the company’s cloud computing efforts, a business considered vital as more business customers choose to rent applications and other programs in far-off data centers rather than run software themselves. 
    For years, Microsoft did not pay enough attention to how the cloud was attracting the creativity of a new generation of developers. When he got control of the division that included Microsoft’s cloud initiatives, Nadella changed that. He began meeting with start-ups to hear more about what Microsoft needed to do to become more responsive to their needs. 
    “When you look at the most exciting things happening in tech, all the platform shifts happening and disruption — social, mobile, cloud — Microsoft has not even been part of the conversation until recently,” said Brad Silverberg, a Seattle-area investor and a former Microsoft executive. “With Satya’s leadership, Microsoft is doing interesting things in cloud.” 
    But Nadella has to grapple with a much broader set of challenges in markets in which he has little experience, like mobile devices. He inherits a deal to acquire Nokia’s mobile handset business, along with 33,000 employees, and a wide-ranging reorganization plan devised by Ballmer and still in progress. 
    In an interview in July, Nadella was supportive of the reorganization plan, which he predicted would allow Microsoft to adapt to changes in the market more quickly than in the past. “It’s not like our old structure didn’t allow us to do some of this,” he said. “The question is whether you can amplify.” 
    In his statement on Tuesday, Nadella said: “The opportunity ahead for Microsoft is vast, but to seize it, we must focus clearly, move faster and continue to transform. A big part of my job is to accelerate our ability to bring innovative products to our customers more quickly.” 
    Nadella was Microsoft’s secondhighest paid executive last year, earning $7.7 million in salary, bonus and stock grants. Only COO Kevin Turner made more. Microsoft has not yet announced his new package. 
    Nadella’s elevation makes him the highest-ranked executive of Indian origin in the corporate world, ahead of such familiar names as Pepsico’s Indra Nooyi and Mastercard’s Ajay Banga. Microsoft's Windows still runs roughly nine out of every 10 desktop and laptop computers in the world, and its Office and Exchange programs are corporate mainstays. The company generated $27 billion in operating profit in the year ended June 30, and holds $84 billion in cash, making it a corporate powerhouse despite the relative decline in its fortune in recent years. 
    Wi t h i n p u t s fro m N Y T & a g e n c i e s

I am 46. I’ve been married for 22 years and we have 3 kids. And like anyone else, a lot of what I do and how I think has been shaped by my family and my overall life experiences. Many who know me say I am also defined by my curiosity and thirst for learning. I buy more books than I can finish. I sign up for more online courses than I can complete. I fundamentally believe that if you are not learning new things, you stop doing great and useful things. So family, curiosity and hunger for knowledge all define me —SATYA NADELLA