As Mahayuti sweeps Maharashtra, Adani’s Dharavi project gains momentum

Critics, including opposition parties, have alleged favouritism in awarding the project to Adani

The BJP-led Mahayuti’s landslide win in Maharashtra is likely to have eased the path for the $3-billion Dharavi Redevelopment Project, led by an Adani group subsidiary.

The opposition Maha Vikas Aghadi, which had vowed to scrap the project, suffered a significant defeat in the assembly elections.

The Dharavi Redevelopment Project Pvt Ltd (DRPPL), 80 percent of which is owned by the Adani group and 20 percent by the state’s Slum Rehabilitation Authority, aims to transform the 600-acre slum, housing over one million people.

However, the project’s success relies heavily on state government support to secure land for rehousing “ineligible” residents—those settled in Dharavi post-2010.

Land acquisition has been a key challenge for the project authorities. The Union commerce ministry recently handed over 256 acres of defunct salt pan land to the state, which in turn allocated it for rental housing. That land is largely located along the city's eastern coastline, in areas such as Wadala, Bhandup, Kanjurmarg, and Vikhroli. Additionally, the state has allotted 125 acres near the Deonar dumping ground for a similar purpose.

The project has also managed to buy some land parcels in the area owned by the Indian Railways to house "eligible" residents, for which preparatory works, such as the demolition of existing structures, has started.

The project’s terms include housing “eligible” residents on-site, while “ineligible” residents will be offered rental housing elsewhere with the option to purchase later. Among eligible residents, those in tenements that existed before January 1, 2000 will be provided a 350 square feet (sq ft) house free of cost at Dharavi. Project authorities noted that the size of homes provided is 17 percent larger than those provided under the state government’s SRA housing schemes.

For residents in tenements that were built between January 1, 2000 and January 1, 2011, homes of 300 sq ft will be provided under the Pradhan Mantri Awas Yojana, for a payment of Rs 2.5 lakh. Ineligible residents will be housed in what DRPPL called “model townships”.

Project had faced Headwinds

Critics, including opposition parties, have alleged favouritism in awarding the project to Adani and raised concerns about prime Mumbai land being handed over for commercial gains. Some politicians had also objected to the “eligible” and “ineligible” classification, arguing that all residents in the area should be rehabilitated in-situ.

Some developers had also objected to the project’s terms, which had allowed the sale of transferable development rights (TDR) at 90 percent of ready reckoner rates, with developers mandated to buy at least 40 percent of their TDR needs from the Dharavi project.

Due to the area’s proximity to the Chhatrapati Shivaji Maharaj International Airport, the area is subject to height restrictions, which will cause a large quantum of development rights to be generated that can be sold in the open market.

Despite political and logistical hurdles, the DRPPL continues its survey to finalize the number of eligible residents and businesses. This survey is expected to be over by March 2025. According to a statement from DRPPL in October, surveys on around 15,000 structures has been completed.

Adani has promised a “human-centric” development approach, with plans to create trading hubs for Dharavi’s businesses and modern housing for its residents.

Besides housing nearly a million people, Dharavi is home to hundreds of small-scale industries and businesses, brought in by waves of migration to the area over decades from various parts of India, such as Tamil Nadu, Bihar, Uttar Pradesh, and elsewhere. The industries include textile units, recycling, tanneries, potteries, among others.

While the settlement was once on the fringes of Mumbai,  subsequent expansion of the city has meant that Dharavi is now located in the heart of Mumbai, between the island city and the suburbs. It is bound to the north by the Mithi river.

A spokesperson for the DRPPL declined to comment on “political developments”.

2018 Tender

Other than political wrangling, the 2022 award of the redevelopment project was also subject to a legal challenge by the winners of the 2018 global tender for the project. Seclink, a UAE-based consortium, had won the 2018 tender, but the process was subsequently cancelled.

In response to the legal challenge, the state government cited changed economic conditions that emerged during the Covid-19 pandemic, and also argued that despite Seclink winning the bid in 2018, no actual contract was signed between the state government and Seclink.