Indian multinational conglomerate, Adani Group's Real Estate unit, Adani Realty, has formed a joint venture with Mumbai's slum rehabilitation authority to redevelop the Dharavi, a key step towards rebuilding one of Asia's biggest slums, Dharavi, inhabitating over 1 million people.
A Special Purpose Vehicle (SPV) called the Dharavi Redevelopment Project Pvt Ltd has been formed by Adani Realty. This was confirmed by a spokesperson from Adani Group, as per several media reports.
The move from the Gujarat-based group comes just before the government's 16 September deadline. The SPV will consist of representatives from both the state government and the Adani group.
It was in November of last year when Adani group has won the bidding process for the redevelopment of Mumbai’s Dharavi, with an initial investment commitment of Rs 5,069 crore, against a base price of Rs 1,600 crore.
The master-plan, which must be submitted within 150 days, will outline the locations of rehabilitation buildings, free sale buildings, and public amenities such as schools, hospitals, gardens, and playgrounds. It will serve as a blueprint for the entire project.
Adani Group described the slum cluster in its legal documents as — an area of "unhygienic, deplorable" conditions— and aims to demolish it and build new towers on state-owned land to accommodate residents as well as their businesses. Notably, Dharavi has an increasingly large recycling industry, processing recyclable waste from other parts of Mumbai. The area also exports goods to around the world.
As per consultancy firm Liases Foras estimates Adani may invest up to $12 billion on remaking Dharavi and in return get development rights that could yield revenue of up to $24 billion.
Formed in 1884 during the British colonial era, Dharavi has an active informal economy with a total annual turnover estimated at over US$1 billion in 2009, and perhaps grew more over the time, to this date.
SVR Srinivas, who heads the state-run Dharavi Redevelopment Authority, told Reuters in an interview in August that the state will appoint the chairman of the new 80:20 Adani Properties-state government JV, while the CEO will be from Adani Group.
According to Reuters report last month, not everyone living in Dharavi will get free houses but only those who already lived in Dharavi before 2000, mostly ground-floor residents, will get free homes within the redevelopment. About 7 lakhs inhabitants of mezzanine and upper floors are considered ineligible by the government and will be offered units up to 10 kilometers away, which they say could require them to pay upfront costs or higher rents.
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