Track2Realty Exclusive: In the last few years a perception has gained ground within the built environment of Indian real estate that the environmental concerns are at loggerheads with the development. The collective consciousness seems to have believed that the real estate and infrastructure projects often compromise with the environmental concerns and to make a balance between the inevitable urbanisation and avoiding the natural erosion is not that easy. Now that the Government of India promises to settle these concerns and put the clearances on a fast forward track, Track2Realty Focus 2015 examines its pros and cons.
There should be absolutely no cross connection between the environmental concerns and the urban developments. Yet, these two have often been at the logger heads. The blame for this perception and resultant cold feet by both the developers as well as the government authorities goes partly to the lack of understanding about the issues and partly the policy ambiguities come as the major hindrance.
A lot of infrastructure projects in the last few years have actually suffered due to this lack of understanding and the policy ambiguity. As a matter of fact, such has been the extent of the confusion due to supposedly safeguarding the environmental concerns that even when the former Prime Minister Manmohan Singh strongly advocated for fast track clearances of the projects, his own Minister of Environment & Forests (MoEF) flagged it by voicing reservations in the public domain. Much water has flown since then but the debate is far from being over.
Now with a stable Government at the Centre all eyes are yet again on the MoEF to see how this government deals with the environmental concerns while making sure that the real estate and infrastructure projects do not suffer in the process. After all, the Narendra Modi Government has already promised creation of 100 new cities in their election manifesto.
Analysts believe if only the new government goes by the decision of the MoEF of the previous government that decided in June 2013 that the timelines stipulated in the Environmental Impact Assessment (EIA) Notification, 2006, would have to be strictly followed by the State Environment Impact Assessment Authority (SEIAA) and the State Expert Appraisal Committee (SEAC) while processing proposals for Terms of Reference/Environmental Clearance pertaining to building and construction and township and area development projects, a lot of delays can be checked.
The sector has been routinely complaining that the real estate projects face inordinate delays in securing environmental clearances. The delays, in a majority of the cases, lead to substantial cost escalation, the brunt of which is ultimately borne by the buyers. In December 2012, a ten-member committee under the chairmanship of Dr. K. Kasturirangan, Member, Planning Commission, was constituted by the MoEF to review the provisions of the EIA Notification, 2006, relating to grant of environmental clearances for roads, buildings and SEZ projects, as well as the February 2012 guidelines for high rise buildings.
The committee has already submitted its report. One of the terms of reference of the committee was to review the requirement of environmental clearances for buildings and real estate projects so as to avoid duplication considering that such projects are covered by local civic authorities and under provisions of the relevant master plan, building control regulations and safety regulations.
The MoEF‚Äôs decision concerning adherence to timelines stipulated in the EIA Notification, 2006, is in line with the recommendation of the committee on the ToR. It requires the SEAC to make appropriate recommendations within 60 days of the receipt of the complete proposal from project proponents. The SEIAA would consider recommendations of the SEAC and convey its decision to the applicant within 45 days of the receipt of recommendations.
The MoEF is going to regularly review the progress in disposal of cases by SEIAAs with the objective of meeting the timelines. In order to avoid delays in processing of proposals, project proponents have to provide complete information at the time of submission of documents for ToR/EC.
To ensure adherence to the stipulated timelines, avoid duplication of work, and speed up the scrutiny process, the SEIAAs and SEACs would focus only on certain thrust areas of environmental sustainability while appraising building and construction and township and area development projects.
The thrust areas include brief description of the project in terms of location and surroundings, environmental impacts on project land and its surrounding developments and vice-versa, water balance chart, waste water treatment and its details including target standards, alterations in the natural slope and drainage pattern and their environmental impacts on the surroundings, ground water potential of the site and likely impacts of the project, solid waste management during construction and post construction phases, air quality and noise levels and their likely impacts during construction and operational phases of the project, energy requirements, traffic circulation system and connectivity, green belt/green cover and landscape plan, disaster/risk assessment and management plan, socio economic impacts of the project and corporate social responsibility, environmental management plan during construction and operational phases, and any other related parameter of the project that could impact environmental sustainability and ecology.
The SEIAAs and the SEACs would not focus on other issues normally looked after by concerned local bodies, state government departments and state pollution control boards. In case of large pendency, the state government could send a proposal to the MoEF for notifying another SEAC.
The industry analysts are not impressed either with the confusion and policy ambiguities that prevail the functioning of the urban development. Pranay Vakil, Chairman, Praron Consultancy pointedly throws some questions like, should factories exist where they exist in the cities? How to preserve the green cover and what should be the norms? What is the larger interest for the largest number of people? According to him, pro-active developmental policies may hurt some people but the government has to decide what greater good is for greater number of people. He questions the rationale of CRZ and questions whether there is political will to do which everyone thinks is right.
‚ÄúThe biggest problem is the lack of coordination among various power centres who are often working at the cross purposes. Even if the Chief Minister in Mumbai finds there is a need for an airport but the Environment Ministry sitting in Delhi does not even fully appreciate what the problems in Mumbai is then who will take a final call. The Environment Ministry may sit over the file for two years despite the Chief Minister following it up. So, you have two authorities who are conflicting against each other, and the incremental cost of the delay is into thousands of crores. How are you going to address it,‚ÄĚ questions Vakil.
Santosh Naik, MD and CEO of Disha Direct sounds optimistic when he says that the factories in a city like Mumbai will eventually go from the main cities because the sheer land value is higher than their production for the next 10 years. In New York or Manhattan there is no factory because of the high land prices. There are only offices; even the residences are on periphery, like New Jersey. So, a city like Mumbai will soon become like Manhattan.
‚ÄúAs far as green cover is concerned, is there any policy that the land owner will have to maintain it? If that be the case, the biggest land bank is with the government. For individuals, you cannot have more than 50 acre of agriculture land. But the corporates are holding thousand acres of urban land. So, as a land owner my interest is not to provide green cover but to see how much money I can make out of this land that I have. So, there has to be a clear guideline for that,‚ÄĚ recommends Naik.
There seem to be a consensus among the developers and analysts that environmental concerns are misplaced and it does not come in the way of urban development, if only the policies are framed in a way that there is clarity for every stake holder. That clarity has been a missing link and one only hopes that the new government at Centre will address it. If it is addressed, probably the World Environment Day will be more meaningful for the sector, which has actually been at the receiving end with environmental clearances being one of the major handicaps.