Delhi has grown rapidly over the last few years and its population has increased ten-fold (to 1.7 crore) in just six decades. However, according to the Delhi Development Authority’s (DDA) estimate, the current infrastructure can serve only 1.5 crore people. About 60 lakh people are expected to be added to Delhi’s population by 2021. Thus, the city requires adequate infrastructure to support about 80 lakh people to cover the existing deficit. This requires the development of about 50,000–60,000 acre of land and a strong financial commitment from the government. Direct acquisition of large tracts of land may be not feasible due to the ever-increasing land prices. Landowners have anyway challenged direct acquisition due to less transparency in the process and unfair compensation. To address these concerns, DDA recently introduced the land pooling policy to facilitate faster and efficient development. The policy is aided by incentives such as high floor area ratio (FAR) and a singlewindow mechanism. DDA and the government have restricted themselves to being just facilitators and are promoting public-private partnership for the development of urban infrastructure
in Delhi. The new land pooling policy is expected to result in the availability of at least 40,000 acre of new land, a majority of which will be in outer Delhi areas such as Bawana, Najafgarh and Narela. Such large-scale development is expected to make Delhi a major property market in the entire NCR region. Developers have already acquired about 20,000 acre of land in outer Delhi areas and they are now preparing development plans . To upgrade urban infrastructure, the government has approved INR90,000 crore to be spent during the 12th Five-Year Plan (FYP) (2012–2017), which translates to a spending of about US$882 per capita, which is way higher than India’s average of US$50 (the average for China is US$360 and US$500 for South Africa). A combination of funding, political will and reforms is expected to assist the city’s real estate and urban infrastructure sectors to witness an impressive medium- to longterm growth. We express gratitude to the National Real Estate Development Council (NAREDCO) for allowing KPMG in India to publish a white paper on this landmark reform introduced by the government.
Delhi MPD-2021 envisages strong growth over next several years
The state of Delhi holds immense importance for India. Besides being the capital of the world’s largest democracy, it is also the hub of socio-economic and political activity in the country. Attracted by strong economic growth, the population of Delhi has increased tenfold over the last six decades primarily due to immigration from other Indian states making it one of the most populous cities in the world.
The Delhi Development Authority (DDA) was established in 1957 to accommodate a growing population, provide adequate infrastructure and oversee planned development in Delhi. In 1962, the first 20 year Master Plan for Delhi was introduced. Thereafter, it was modified extensively to cover the period up to 2001 (MPD-2001). Currently, the development of Delhi is being governed by the Master Plan 2021 (MPD-2021).
However, planned development in the state has so far not been able to meet the unprecedented population growth. There is a shortage of urban infrastructure, such as housing, roads, sewerage, water, transportation and power. As per estimates by DDA, Delhi’s present infrastructure can accommodate a maximum of 1.5 crore people2 .
With the population of Delhi set to rise further, developing additional infrastructure is becoming challenging by the day. The population is expected to increase to 2.3 crore by 2021 from 1.7 crore in 2011 translating into a CAGR of 3.1 per cent. Thus, new urban areas are required to be developed from scratch to accommodate the new 80 lac population by 20213 .
2. Delhi Urban Area – 2021, Delhi Development Authority website, http://www.dda.org.in/planning/docs/03_Delhi_ Urban_Area_.pdf, accessed 9 December 2013
3. Master Plan for Delhi – 2021, Delhi Development Authority, 7 February 2007
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