Recently, Delhi witnessed a massive drive to seal commercial shops in local markets across the city, executed by the BJP-led Municipal Corporations of Delhi (MCD) under the supervision of a Supreme Court Monitoring Committee. At last count, almost 600 establishments had been sealed, rendering popular markets like Karol Bagh, Model Town, and Defence Colony virtually lifeless.
What’s more, the trade sector, which employs almost 30 percent of Delhi’s workforce and is the single largest contributor to the state’s GSDP, is reeling under distress in the aftermath of demonetisation and GST.
This has thrown Delhi’s traders into a tailspin and left more than 10 lakh people jobless, adversely affecting Delhi’s economy.
As far as the burden of responsibility is concerned, it is upto the Delhi Development Authority (DDA) and MCD to resolve this crisis.
Through the Lens of History
In 1957, DDA was created to carry out the planned development of Delhi, and in 1962 it promulgated the first Master Plan of Delhi (MPD-1962) — a blueprint for Delhi’s growth over the next few decades. However, MPD-1962’s failure allowed Delhi to grow haphazardly.
The next Master Plan came up only in 2001, instead of 1982. Even MPD-2001 failed to incorporate the ground realities of Delhi and did not make allowances for commercial establishments to operate in residential areas, which was the norm in Delhi by then.
This issue came to a head in 2006, when the Supreme Court ordered the MCD to seal all commercial establishments running in residential areas. After huge protests across Delhi and the death of four people, the then Central government passed an emergency ordinance, allowing for the use of residential areas for commercial purposes as well, thus, putting a temporary end to the sealing drive.
Soon after, in 2007, DDA came out with MPD-2021, which laid down rules for mixed use of residential areas for commercial purposes.
Specifically, Section 15.9 introduced the provision of collection of a one-time conversion charge and annual mixed-use charge from commercial establishments in residential areas to enable them to continue operation without the fear of sealing.
Why a ‘Sealing Drive’ Now?
The current sealing drive is being undertaken on the following pretexts:
- Commercial establishments have not deposited the conversion charge
- Commercial establishments have not paid the annual mixed-use charge regularly
- Commercial establishments have not paid the penalty on late payment of the above charges
However, there is more to it than meets the eye. Serious infirmities and a lack of planning on the part of the MCD and DDA are responsible for today’s crisis.
What are the Solutions?
1. Revise Outdated Floor-Area-Ratio (FAR) Norms
DDA has notified five types of commercial areas: Central Business Districts (CBD), District Centres (DC), Community Centres (CC), Local Shopping Centres (LSC) and Convenience Shopping Centres (CSC), each intended to cater to a certain group of people.
LSC and CSC were created to cater to the day-to-day needs of the local population and markets like Hauz Khas, Model Town and Defence Colony, which are bearing the maximum brunt of the current sealing drive, fall in this category.
DDA’s building control norms mandate that all LSCs and CSCs are to have 40 percent ground coverage with 180 FAR, which is impractical as the FAR has not increased commensurate to the growth of Delhi.
To rectify this, DDA should immediately amend MPD-2021 so as to increase FAR for LSCs and CSCs from 180 to 300 with an equivalent increase in ground coverage, thus facilitating proper conduct of trade and allied activities.
2. Reduce Conversion Charges for Local Shopping Centres (LSCs)
DDA, in 2015, rationalised and slashed the conversion charges from Rs 89,094/m2 to Rs 22,274/m2, which still are extremely high for LSCs.
An oddity arises as the conversion charges for LSCs are far higher than for shops on commercial roads whereas the FAR for LSCs is lesser than that for shops on commercial roads. LSCs get the worst of both the worlds. Hence, there is an urgent need to bring the conversion charge for LSCs at par with shops on commercial roads.
3. Waive off Penalty on Late Payment of Conversion Charges
The penalty for late payment of conversion charge was 10 times the conversion charge, up till 2016 when it was revised to 3 times. A consequence of this abnormally heavy penalty was that many establishments started to forego paying the conversion charge as well as the penalty and remained liable to be sealed. This is a classic case of ‘if the sky falls we shall catch larks’.
The immediate solution is to waive off the penalty, completely, on late payment of conversion charges.
4. MCD Should Be Held Accountable For Not Undertaking Regular Surveys
MPD-2021 directs the MCD to conduct periodic surveys to ascertain and convert illegal establishments to mixed use. However, MCD has conducted very few surveys over the past decade and it is only after mounting pressure from Delhi’s traders after the recent sealing drive did the MCD promise to conduct regular surveys.
Therefore, Section 15 of MPD-2021 needs to be amended to hold MCD accountable for any laxity in this regard.
‘Blame-Game’ Must Stop
It has been speciously argued by the BJP that the AAP-led Delhi government has not yet notified 351 roads for mixed-use operation of establishments, and this has precipitated the sealing drive. But in fact, sealing has been concentrated on shops on the 2,183 roads which were notified for ‘mixed-use’ operations in 2006, and not the 351 roads.
Thus, the need of the hour is for the BJP to stop the mud-slinging and blame-games, and to focus on solving the current crisis by following the steps outlined above.
(Pranav Jain works with the AAP and Delhi Government on key issues. He can be reached on Twitter at @pranavj142. This is an opinion piece and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same)
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