After Adani row, will the redevelopment of Asia's biggest slum Dharavi take place?

Tribune Web Desk

Vibha Sharma

Chandigarh, February 13

The upheaval in the embattled Adani Group continued on Monday with shares in its listed companies registering losses in the wake of allegations of accounting fraud and share manipulation by US-based short seller Hindenburg Research.

The group’s seven listed stocks have lost more than $100 billion in market value since Hindenburg’s allegations, which the company denies.

Now, along with its stock, focus is also on other ventures of the group, including Dharavi—Asia’s largest slum—the development of which the group led by billionaire businessman Gautam Adani bagged in 2022.

Dharavi —Asia’s largest slum

The plan to redevelop Dharavi has been in the pipeline for around two decades now.

Spread over 240 hectares of premium land in the heart of Mumbai, the country’s financial capital, more than one million urban poor live in the cramped shanties located in narrow alleys of Dharavi.

An area of just over 2.1 sq-km and population of over 11 lakh makes Dharavi one of the most densely populated areas in the world.

Dharavi development project

The Dharavi project aims to change the life of lakhs of people who live and work there with a promise of high-rise buildings, regular water supply, proper sanitation, etc. The group has offered to construct free housing for all eligible dwellers and build related infrastructure as part of the makeover of the 300-acre slum over seven years.

However, the project has left many worried, including those operating small-scale manufacturing units in the area.

The informal economy based on unorganised businesses in sectors like leather, footwear, clothing and food is estimated to generate an annual turnover of around $1 billion, according to reports.

However, many residents are said to be not complying with the eligibility criteria for free housing under the project. Neither the government nor the developer sought their views on the redevelopment, residents also complained.

The Hindenburg Research has given a chance to the Opposition, critics of the project and residents to demand its scrapping.

The Group, however, says it is committed to the redevelopment of Dharavi and waiting for the letter of award from the Maharashtra government and is armed with a strong net worth and balance sheet.

Politics over Adani Group

The Hindenburg report has, in fact, raised questions on key projects helmed by the Adani group related to reality, power and infrastructure in Mumbai.

Its critics point how in a short span of around five years, the Group has taken over key projects becoming an important player in Mumbai’s realty, power and infrastructure sectors.

Apart from the Dharavi project, its other projects include the Navi Mumbai International Airport and one related to the expansion of electricity distribution business to Navi Mumbai.

Maha Vikas Aghadi has been mounting pressure on the state government to reconsider the decision to award the project to Gautam Adani's firm.

The Maharashtra Congress has asked the state government led by Eknath Shinde and Devendra Fadnavis to take back theproject from Adani Group, saying that it may meet the same fate as the Sahara Group.

AAP leaders claim the poor of Dharavi “will be rendered homeless, their livelihoods snatched and land grabbed to make way for apartments for the rich and powerful”.

Dharavi redevelopment-background

In the past 18 years, successive governments discussed redeveloping Dharavi but without much success. In 2004, the government officially decided to take up the project involving the rehabilitation of families and commercial units.

The attempts failed because of “unfriendly real-estate market conditions, viability issues and the number of eligible slum dwellers,” according to the reports.

Observers claim that the Shinde-Fadanvis government wanted to kick-start the project so that work on it could commence before the 2024 general elections.

It decided to buy land from the Railways and hand it over to the developer to make the project profitable.

After a stalled attempt in 2018-19, in October it floated a global tender with a base price of Rs 1,600 crore.

Despite a pending court case, the Cabinet decided to go ahead with the proposal as the Bombay High Court “had not issued any interim order or put a stay on the current bidding process”.

The Adani group with a bid of Rs 5,069 crore was declared the winner.

The DLF group had submitted a bid of Rs 2,025 crore.

In 2018-19, the Dubai-based Seclink Group emerged the highest bidder with a bid of Rs 7,200 crore. The Adani group lost as it had bid Rs 4,500 crore.However, the bidding process was cancelled after which the Seclink group filed a case in the high court challenging the government’s decision, according to reports.

About The Author

Tribune Web Desk

The Tribune Web Desk brings you the latest news, analysis and insights from the region, India and around the world. Follow the Tribune Wed Desk for not just breaking news stories but wide-ranging coverage of events.

Join Whatsapp Channel of The Tribune for latest updates.

#Gautam Adani #Hindenburg Report #Mumbai