Moneylife offers its readers a unique service—helping redress grievances on a best-effort basis....
Experts point out that granting higher FSI for constructing parking lots will give builders huge profits
The Maharashtra chief minister recently announced the revival of the parking lot policy for Mumbai which promises extra FSI for private developers in public-private partnership ventures. However, experts and civic activists argue that this will not solve any of the problems that have cropped up, but will only ensure higher profits for builders.
According to an official statement, parking lots are allowed to be constructed up to a height of ground-plus four storeys with two basements, and the relevant development control rule DCR 33(24) has been amended accordingly. Mechanised parking lots have been disallowed. But the developer will pay 40% premium on market value for the extra FSI to the state authorities, which will be shared equally by the state government and the city civic body.
A committee consisting of the municipal commissioner and the traffic police commissioner will conduct a scientific study to enable finalising the plans for parking lots by assessing the parking needs of an area. The proposals will be submitted for approval to the state government.
The parking lot policy was earlier withdrawn, following criticism that it would add to be burden of the city’s infrastructure and that builders were taking undue advantage of the policy.
Ashok Datar of the Mumbai Environmental Social Network said, “Where is the logic? When we build such a large quantity of vertical paid parking in such a small area, we are creating congestion within each plot. We already have too many towers with too many cars, and on top of that we have outsiders coming and parking at such high heights. What is the need for more towers when the existing ones are not used?”
Multi- storey parking lots mushroomed in some areas of the city. Of the 72 proposals submitted to the Brihanmumbai Mahanagarpalika (the civic administration), only 25 are in the suburbs and the rest are for south and central Mumbai. The multi-storey parking lots that have come up are largely unused. Mr Datar mentioned two examples, one at Inox, Nariman Point, and the other at Akruti on Warden Road, that were little used. But builders made sizeable profits through incentives like the FSI that had gone up to as high as four in some cases.
Mr Datar learned through his RTI queries about the huge profits builders could earn from the FSI largesse. Near Siddhivinayak Temple, in central Mumbai’s Dadar area, DB Realty planned a residential tower with 184 flats, priced at Rs9 crore each. But from the extra FSI they received for the parking lots that they built nearby, they are entitled to build three residential towers (within 500 meters of the temple complex) that will have an additional 372 flats. The entire project is now valued at Rs3,000 crore, nearly the original plan.
Some commentators believe that improving the ground level parking instead, would be a better move, which is the practice in some other congested metropolises like London and New York. Ground parking charges there are higher than public transport fares, in order to dissuade people from using private vehicles.
Veeresh Malik, writer, automobile enthusiast and Moneylife columnist, says that instead of constructing new parking lots, the space should be used to improve public transport and easing congestion. He suggested that buildings not having parking space should be charged and the funds used to construct parking lots in those areas.
“Building codes should be modified to provide for ample 2-below/4-above kind of parking options for new buildings,” he said. “There must be clarity on the charges and taxes payable by multi-storey public parking wherever provided.”
Mr Datar said, “The idea is to ease the traffic congestion. Instead, this will encourage more people to use cars. What is the point then?”
The net profit could have been flat had there not been an exceptional gain of Rs226.77 crore achieved out of the sale of its investment in an associate company
Mumbai: Infrastructure major Larsen and Toubro (L&T) today reported a 17.25% growth in standalone net profit to Rs1,686.21 crore for the quarter ended 31 March 2011 compared to Rs1,438.10 crore for the corresponding quarter of 2009-10, the company said in a filing to the Bombay Stock Exchange.
However, the net profit could have been flat had there not been an exceptional gain of Rs226.77 crore achieved out of the sale of its investment in an associate company, reports PTI.
During the quarter, net sales of the company stood at Rs15,078.39 crore, a growth of 12.73% over Rs 13,374.89 crore in the January-March quarter of FY09-10, the filing added.
The company’s gross revenues from the engineering and construction segment grew by 12.85% to Rs13,664.31 crore during Q4, while its electrical and electronics segment reported a meagre growth of 1.32% to Rs 1,001.39 crore.
For the full year 2010-11, the standalone net profit of L&T fell by 9.54% to Rs3,957.89 crore due to an 18.58% increase in its tax outgo to Rs1,945.86 crore. In 2009-10, the company had posted a standalone net profit of Rs4,375.52 crore.
On a consolidated basis, the net profit of the company went down by 18.24% to Rs4,456.17 crore in the 2010-11 fiscal from Rs5,450.74 crore in the year-ago period.
In a separate statement, the company said that its order book amounted to Rs1,30,217 crore as of 31 March 2011, due to an increase of about 27% in order inflow during the January-March quarter.
Giving its outlook for the current year, the company said that completion of several expansion projects is underway and it will strengthen the company’s position of pre-eminence in various business verticals.
However, it added that “intense competition and spiralling input costs may exert some pressure on the operating margin going forward.”