Maharashtra govt awards Dharavi Redevelopment Project to Adani Group

Eight months after the Adani Group was declared the highest bidder for the Asia’s largest slum development project, the Maharashtra government passed a resolution and awarded the project to Adani Properties Private Limited

Hyderabad: With Bharatiya Janata Party (BJP) at the helm of affairs in Maharashtra, handing over the Dharavi Redevelopment Project (DRP) to Adani Group was just a mere formality.

Eight months after the Adani Group was declared the highest bidder for the Asia’s largest slum development project, the Maharashtra government passed a resolution and awarded the project to Adani Properties Private Limited. But things are not as simple as it appear over the surface and lot of “effort” went into handing over the project to Adani Group.

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According to reports, the BJP government allegedly tweaked terms and conditions in the tendering process. All this was done despite the break due to a change in government, managed to get back into power after engineering cracks in the Shiv Sena and Nationalist Congress Party and making Ajit Pawar as Deputy Chief Minister and Finance Minister as well. A look into the chronology of developments in the last few years, sheds light on how new rules were incorporated into the terms and conditions for the tendering process, which enabled the Adani Group to secure the project.

Though the Maharashtra government has been working on the Dharavi development, it was not successful. In 2018, the then Chief Minister Devendra Fadnavis floated the DRP idea and global tenders were floated. The UAE-based Seclink Technologies emerged as the highest bidder. The DRP officials wrote to Seclink calling for a meeting to proceed further with the tender awarding process. Meanwhile, the State government signed a pact with the Railway Land Development Authority (RLDA) to lease over 45 acres in the neighbouring Matunga and Dadar area for the temporary accommodation of the slum dwellers.

In 2019, the Central Election Commission announced general elections in May. The DRP tender award letter was put in cold storage in the guise of Model Code of Conduct. After the elections, Uddhav Thackeray’s Shiv Sena government came to power and decided to cancel the 2018 Dharavi tender, based on the Attorney General’s recommendation. Challenging this, Seclink approached the court and sought a stay on the new tender.

With cracks surfacing in the Shiv Sena party and the SS-NCP-INC coalition, a new government was formed. As per the terms, Fadnavis was made as Deputy Chief Minister and Urban Development Minister, under whose Ministry the DRP was. The Maharashtra government told the court that tender conditions were finalised considering the ‘overall circumstances of the DRP’ and claimed that the tendering process was fair and transparent.

When fresh tenders for the DRP were floated in September 2022, the terms and conditions, many changes were introduced in the rules. Accordingly, the technical expertise norm, under which, the bidder should have built 25 million square feet in the last seven years was cut down to six million square feet for obvious reasons. Likewise, the net worth of the bidder was enhanced from Rs 10,000 crore in cash or equivalents to Rs 20,000 crore.

Among the three bids, the Adani Group, which quoted Rs 5,069 crore, emerged as the highest bidder. Of the estimated 70 million square feet of property on which the project is to be implemented, about 50 per cent can be sold in the open market. This is where Adani Group can make the money. Only the balance has to be used for the rehabilitation of the original residents of Dharavi.

Going by the current realty rates in Dharavi, which are around Rs.10,000 per sft, would definitely escalate as the DRP gains momentum, which means Adani stands to reap much more than what he invests for the entire project from the 50 per cent area that he can sell in the open market.

Residents worried

As the news spread about the Maharashtra government awarding the 259 hectare RDP to Adani Group, residents are worried a lot, especially over loss of business to many small scale units in the area. Apart from residential huts and tenements, Dharavi is home to idli sellers, leather, imitation jewellery units. In the guise of executing the project, all the residents and the small scale units, would be relocated to other places.

In most units, the owner and tenant live in two separate rooms. The livelihood of the owners, who earn rent, would be lost. As part of the project, the units would demolished and after the project would be complete, only one room would be allotted, Paul Raphel, president of Dharavi Nagrik Seva Sangh was quoted in media report.