Social infrastructure: Whose responsibility?

Ravi Sinha

social infrastructure plays a huge role in determining the property value as well as the real estate growth of an area. No urban habitation can survive without the requisite social infrastructure that may include schools, hospitals, sports facilities etc. Hence the availability of social infrastructure is strongly connected with the real estate growth.  Housing that was once the prerogative of the State has got into private hands and the creation of physical infrastructure has also seen the feasibility of a new financial model of Public Private Participation (PPP). However, the responsibility of creating social infrastructure like schools, hospitals, clubs, swimming pools, entertainment zones etc has remained non-defined. This can have a detrimental effect on the realty market.

No one’s baby

As major Indian cities were getting social infrastructure deficit, the group housing societies started creating their own amenities like clubs, swimming pools, gym etc as project differentiators. In the larger townships the creation of schools and hospitals by the developers added to the USP of a project. But all this is leading to a lopsided growth where certain cities with better social infrastructure are proving to be investment and migration magnets, while others are no less than ghost towns. The picture is not rosy for the privileged cities, as they suffer from over-populated ‘soda bottle syndrome’ in the process.

Urban planners in this part of the world are hence still debating as to whose responsibility it is to create social infrastructure and recreation projects that could elevate the livability index of a given city. For example, one of the major traction points of Gurugram has been the golf course and the projects by various developers, even at the far end of the Golf Course Road, are still being marketed in the name of proximity to it. 

While there is no denying that quality social infrastructure projects like golf course have been the USP of India’s luxury landscape in Gurugram, yet such projects have often fallen into the no man’s land in terms of its ownership issues and the challenges of creating it.

Worse even, while no one wants to take pains to create social infrastructure such endeavours by the private parties have often hit road blocks as neither the State is a facilitator nor is the eco system conducive.

Need for progressive policies

A Punjab and Haryana High Court order a couple of years back that quashed the Haryana government’s decision to transfer 350 acres in Gurugram also raised the issue of land acquisition for public welfare as the allotted land was also for development of sports facilities besides a residential society and commercial areas.

However, global experience suggests that it is the progressive policies of the government that define whether the given property market can turn into a luxury destination and high-growth corridor. In Gurugram today some of the best schools, hospitals, clubs, golf course etc within the periphery of the main city built by the respective developers epitomise the concept of ‘Live, Work & Play’.  

Even in the context of Delhi-NCR, Noida lags behind Gurugram in spite of better physical infrastructure being rolled out by the government. The reason being that social infrastructure there could not keep pace with roads and highways. Even the top notch property location of South Delhi is  being eclipsed by Gurugram due to  impressive social infrastructure.

Urban planners are sceptical about the government leaving everything to the private parties. They maintain the private developers can, at the best , maintain some components of social infrastructure like schools and hospitals, but not the key components like police station or post offices.

Effective partnership models

Even with the Public Private Partnership (PPP) model the government has to come forward as a partner in the true sense of the term to make it take off well. Some of the projects in India like Delhi Metro or airport modernisation have been successful because there was a genuine partnership between public and private players. But if the approach of the government is that “we have awarded you the contract and now it is your responsibility”, then there is going to be a problem.

It won’t work if the mindset is that whatever the challenges, whether regulatory or land acquisition, it has to be dealt with by the private partner alone. To make PPP successful the government has to play a much larger role to create the basic infrastructure, get the clearances and make the project attractive and then have the private expertise to execute it. So, the relationship should not change from partnership to that of authorising agency and contractor. 

From a developer’s perspective, government support is extremely important for any property market to grow and this support factor determines the potential of the given market. A recreation project can’t be planned if the basic facilities are not worth it to be called ‘location, location and location’.

Geographical positioning has to be supplemented with other logistics. From a buyer’s perspective, it is more about connectivity. One just can’t conceptualise a global city where social infrastructure and other contingency services are not around.

Fixing responsibility

In the Indian standard of planning when it comes to the creation of the social infrastructure both the government and the developers just look at each other. The developers maintain that they are already paying EDC (external development charges) and IDC (internal development charges) and if the policies define it like that, they are ready to pay for the social infrastructure as well. If the government machinery still can’t do so, at least allow them to create it by facilitating and not blocking.

— The writer is CEO, Track2Realty