*Date:10/12/2006* *URL:

Tamil Nadu <http://www.thehindu.com/2006/12/10/23hdline.htm> - Chennai

"State only facilitator of realty business"

Staff Reporter

  *Jaipal Reddy for townships built through public-private partnership *


*QUICK WORD: S. Jaipal Reddy, Union Minister for Urban Development having a
word with Irfan Razack, chairman, Estate South 2006 at the summit in Chennai
on Saturday. — Photo : M. Vedhan *

 CHENNAI: The Government has no business to be in the real estate business,
Union Minister for Urban Development Jaipal Reddy said.

Addressing delegates at "Estate South 2006," a summit on emerging real
estate trends in south India, Mr. Reddy made it clear that the government's
main role is to be a facilitator.

Insisting that consent acquisition was the right mode, he said, "It is not
proper for states to acquire land using their acquisition powers
indiscriminately. Landowners will be willing to sell if they don't feel they
are being shortchanged."

In-situ development

Recommending townships built through public-private partnership (PPP), Mr.
Reddy said the government's main role was to facilitate infrastructure for
which builders must be fully charged. He advocated "in-situ development,"
where the land on which the urban poor live was treated as a valuable
resource to create multi-storeyed flats for the poor themselves.

It was a win-win proposition, he said, since the poor slum dweller would get
better housing, the builder access to the rest of the land and the
government would get paid for it.

Apart from housing, the Minister said the Jawaharlal Nehru National Urban
Renewal Mission (JNNURM) would spend Rs. 1 lakh crore of central, state and
local authority funds over the next six years, to improve drinking water
facilities, sewerage system, storm water drains and public transport in

Public transport

He advocated public transport systems built on a PPP mode, and said the
Centre was providing finance to bridge the viability gap in metro rail

Bus Rapid Transport Systems (BRTS), with dedicated space for world-class
buses, cyclists and pedestrians, were already being implemented in Pune,
Indore, Bhopal and Ahmedabad.

The Centre would offer a 35 per cent grant to implement BRTS in cities with
over 4 million people, Mr. Reddy said.

In smaller cities, it would cover as much as 80 per cent of the cost.

Cheer from developers

The JNNURM had been linked to certain reforms and conditions. The state
governments must scrap their Urban Land Ceiling Acts and cut stamp duties to
at least five per cent.

The Minister got a cheer from developers at the summit when he promised to
be their advocate in convincing states to reduce duties.

Irfan Razack, chairman of Estate South 2006, had earlier asked the Minister
to rationalise the tax structure and introduce a CENVAT model.

He said land reforms were essential to unlock land resources, so that
affordable housing could be taken to the masses.


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