Home > Uncategorized > Low-Income Housing in Indian Cities – Some Considerations for Policy

Low-Income Housing in Indian Cities – Some Considerations for Policy

April 16th, 2008

Housing has been one of the most pressing policy issues since the rise and growth of cities. With increasing urbanization, the provision and availability of housing has taken on the proportions of a crisis. Daily we witness both, widespread and large-scale construction of buildings, townships and apartment complexes in the suburbs, urban fringes and peri-urban areas in Indian cities. There has been a boom in the housing and real estate market with the rise in the pay scales of middle-income groups and the ease of availability of loans and financial instruments to purchase houses since the mid-1990s. A house is now no longer only a personal asset, but also a form of investment which gives returns. While middle-income housing has received a tremendous boost, it is important to pay attention to the conditions of low-income/affordable housing for the poor that has taken a beating with the boom in the construction and real estate industry.

In Indian cities, the state is usually seen as the provider of low-income and affordable housing. The Delhi Development Authority (DDA), the Bangalore Development Authority (BDA), the Maharashtra Housing and Area Development Authority and the Slum Rehabilitation Authority (SRA) in Delhi, Bangalore and Mumbai respectively are the state agencies that have constructed and/or facilitated the construction of low-income group housing (along with middle-income and high-income group housing). Some of these agencies, such as the BDA and DDA, have also been responsible for confirming land tenures for poor groups, albeit a highly contested procedure, thereby securing occupants’ right to housing and secure land tenure.  In Mumbai, private initiatives towards developing low-cost/affordable housing depend on state subsidies and/or incentives. The Transfer of Development Rights (TDR) model in Mumbai was one of the first innovations to enable private developers to develop slum housing in return for development rights in high-value real estate areas in the city, a model that is now coming under increasing criticism for various reasons.

As mentioned above, the house is now not only an asset, but also a source for earning revenues for the middle-income and high-income groups. These groups invest in purchasing houses, which they then rent/lease to tenants on an eleven-month leave and license agreement.  In the context of slums, the house is not merely a unit for habitation, but is often the economic space where production and manufacturing are carried out. This is clearly evident in the case of slums such as Dharavi and Kurla in Mumbai and Shahadra and Vishwasnager in Delhi, where the family produces leather items, garments, sophisticated electronic equipments, and other consumer goods within the space of the house. These consumer goods are then integrated into the goods produced by large corporations and are also sold in shopping malls. In several slums across cities in India, small shops are attached to the house. These shops are extensions of the house and are developed through multiple tenancy systems (which are usually seen as illegal). In the case of dilapidated buildings in Mumbai, also known as the ‘rent-control buildings’ owing to the freeze on rental rates imposed by the Rent Control Act (RCA) of 1940, the building not only houses the tenants, but the tenants and the landlords have themselves rented spaces within the building to sub-tenants who either reside in the houses and/or engage in providing services such as tailoring, photocopying and manufacture of goods. When we discuss low-income/affordable housing in the context of the poor, we need to bear in mind the fact that the house is simultaneously an economic space for the poor. At the same time, ‘poor’ is not a singular, homogenous category. Floating income levels among the poor, owing to either the seasonal nature of the occupations and/or the nature and structure of the economy itself, makes the category ‘poor’ difficult to define in terms of purely income-level criteria. Individuals and groups keep moving along different scales in the continuum of poverty (though not necessarily consistently). Among the poor are individuals and groups that suffer from chronic poverty and live under precarious circumstances. At the same time, there are slumlords and local leaders who are a powerful and wealthier lot among the poor and who have been criticized for their exploitative roles. Poverty then needs to be viewed as a dynamic that responds to the structure of the economy at any given point in time.

Apart from the house being an economic space that is connected to and simultaneously competes with the larger global spaces of production, distribution and consumption, the nature of the property and the land also define the individual’s and the group’s relationship with law and the state. This dynamic is crucial to take note of in any policy considerations of low-income housing for migrant populations and especially so in the case of multiple forms of tenancies, which complicate ownership of the property, making it difficult to pin down a single owner of the property. This relationship between the occupant/s, the property, law, the state and the market shapes the nature of claims that poor groups can make on the system and also shapes their subject positions. These subject positions keep shifting depending on the shifts in the economy. Housing, then, also needs to be viewed in the larger context of the nature and the structure of the economy at any given point in time. Today, the demand for luxury housing in Mumbai and Bangalore among the upper income groups requires parallel land acquisition policies and laws which in turn invariably infringe on the claims of the poor to housing and land. Subsequently, housing need, demand and supply can be understood by paying close attention to the structure of the economy and the dynamics of politics within cities and nations and across the globe. This is because housing is linked with land, which is a contestable terrain for different groups operating in the realm of the state, market and citizenry. Property and land produce relationships between the citizen subject, law, the state, various market forces and civil society groups. The agency of law, acting to enforce the rule of law, can often negatively impact the housing and livelihood claims of the urban poor and low-income groups. Consequently, zoning regulations, land acquisition laws and property titling procedures, while attempting to enforce rule of law, can impinge on the development of low-income housing by poor groups.

In this paper, we will explain how land and housing are closely linked with the economies that the poor spur as well as participate in the city. Access to housing is important for the poor to fulfill their claims to the city and the economy. As we explicate this proposition, we will also evaluate some of the existing legal and institutional arrangements that either facilitate or come in the way of developing low-income housing. We will also draw from experiences in Indian cities where the poor have developed housing for themselves through occupation and migration and a recent experience in Mumbai where design intervention was planned to facilitate in-situ community self-development housing. As we do so, we will elaborate on areas where policy-makers need to pay close attention when making policy interventions.

House as Economic Space and as means of Consolidation of Claims to Economy and City: As mentioned above, housing is a function of the nature and structure of the economy at different points in time. For e.g. when industrialization started to take place in the mid-nineteenth century (then) Bombay, rich and influential traders shifted to owning mills. Job opportunities were created in the city and there was an increase in the number of migrants coming to the city from interior, drought-affected parts of Maharashtra state for employment. Given the shortage of housing stock, private landlords developed agricultural lands surrounding the mills and constructed what are popularly known as ‘chawls’. ‘Chawls are one room tenements with a common corridor and toilet facilities. (CRIT: 2007, 31) Mill owners housed the workers in these chawls. Thus, in nineteenth century Bombay, housing developed in response to the nature and demands of the industrial economy that was establishing itself in the city. In the 1990s, there was a decline in the industrial economy but the service sector was growing. Housing now had to respond to the changing socio-economic landscape of the city. There was a rise in the pay scales of middle-income groups coupled with the availability of financial products such as credit and debit cards, housing loans, personal loans, etc. which made it easier for the middle and high-income groups to own property. This was also a period when many non-resident Indians (NRIs) started to come back to the country and/or began to invest their capital in real estate in the major first-tier and upcoming second-tier Indian cities. Consequently, luxury apartment complexes and townships were constructed to cater to the demands of the new desires and lavish lifestyles. Artist villages and bungalows were constructed on agricultural lands on the peripheries of Mumbai city to serve high-income groups who wanted to live away from the city. (CRIT: 2007)

Under the new service economy in Indian cities, there has been an increasing demand for drivers, servants, cleaners, security guards and other forms of subsidiary low-income labour. It is often argued that low-income/affordable housing needs to be created for this class of labour. Townships include servants’ quarters to house maidservants and drivers and these are seen as forms of housing developed for the poor conceived as subsidiary labour. This form of housing however does not account for the mobility of the poor groups on the continuum of poverty and designates them to fixed positions on the scale of poverty. The poor are then simply viewed as subsidiary labour rather than as individuals and groups that can spur and engage in productive forms of economies in the city. Let us take the case of Azadnager, a slum in west Bangalore, where migrants have developed housing in the slum and have participated in the clustering economies of the locality. Clustering economies are often viewed as the phenomena of developing and under-developing countries and are perceived as unproductive/economically unfeasible. However, these clustering economies are closely connected with the circuits of global production, consumption and exchange. To give an example, Vishwasnager slum in East Delhi was involved in producing copper cabling wire, which is currently an integral part of reaching cable television to consumers across India.  Azadnager’s geographical proximity with K. R. Market – the central market area in Bangalore city – and various production clusters dispersed around West Bangalore has helped to fuel a number of enterprises within Azadnager. There are home-based enterprises of women rolling incense and tobacco sticks, economies of ragpickers some of who have moved from picking and sorting trash to developing their own enterprises of itinerant trading, and development of autorickshaw transport, which is an important form of public transport in the city. Azadnager comprises of various poor groups ranging from the chronically poor to lower-income and middle-income groups among the poor. Given the nature of the clustering economies in Azadnager, poor groups have had opportunities to move from chronic poverty to lower and middle-income scales. Thus, some of the ragpickers have moved to trading in secondhand electronic items over a period of time through various ethnic and political linkages, availability of diverse forms of finance and availability of physical space to carry out their trades; women rolling incense sticks and tobacco cigarettes have been able to invest surpluses from their trades into real estate, thus spurring rental housing in Azadnager for incoming migrants. Here it is important to note that among poor groups, trade and income surpluses are usually invested in housing and such housing may be developed through multiple forms of tenancies.  Housing in Azadnager has thus developed with the mobility of different groups to different income scales. Individuals and groups have invested trade surpluses in land and developed both housing and spaces for carrying out economic activities within Azadnager. (Benajmin and Bhuvaneswari: 2001) The case of Azadnager, and the experiences from other slums in cities across India, demonstrates that for poor groups, housing is a means for consolidating their position in the city and participating in the economy. This is unlike the way in which housing is conceived in the current service economy in terms of servants’ quarters and schemes for rehabilitating/resettling slum dwellers that takes a shortsighted view of the poor as subsidiary labour.

As the economy intensifies, poor groups recognize the need to secure their claims to the land. Here, the agency of the local politicians, local leaders in the slum and the city municipal corporation are important in securing the tenures and making available basic infrastructure. This process is stereotypically seen as corrupt and exploitative; the poor are imagined as individuals who have no agency to act on behalf of themselves and are subject to exploitation by politicians and slumlords. However, poor groups mobilize institutions and individuals in order to fulfill their claims to land tenure, housing and basic infrastructure. As Omar Razzaz (1993) puts it:

“One only need examine a squatter settlement in a developing country to realize that property relations, use, and rights are defined through strategies of control, contestation, negotiation, and renegotiation. Such strategies span the spheres of market and nonmarket (sic), legality and illegality, and ultimately all options of exit, voice and loyalty.”  (345)

This mobilization depends on structure of politics within the ruling party and across political parties and the status of the municipality vis-à-vis the state government and other parastatal agencies in the city. Such mobilizations undoubtedly involve corruption and are not always easy to carry out, but it establishes relationships between the poor, the municipality and politicians and forces the municipal corporation and political parties to be responsive to the needs of the poor. These relationships are classically condemned as patron-client relations or what is known among Indian middle-classes as ‘vote-bank politics’. However, Dianne Singerman (1995: 134), in her seminal work on the Sha’abi communities in Cairo points out that designating these relationships as ‘patron-client’ does not allow us to probe the structure of politics, and the networks and agencies that various groups can mobilize in order to access the basic needs of life. Singerman criticizes political scientists and scholars for classifying these relationships and networks as ‘informal’ and not paying enough attention to them because they apparently ‘lack juridical and formal recognition’. In Singerman’s opinion, these networks are not only material, but are embedded in strong ideological orientations which emerge from everyday experiences of the state and its institutions, politics and the market.

Models for slum rehabilitation and resettlement, while aiming to provide the poor with housing, often fail to account for the house as the economic space for the poor. When slum dwellers are rehabilitated, their economic claims are overlooked and they are usually compensated for housing and not for the loss of livelihood. For e.g., a large roads infrastructure project was being executed in Mumbai under the aegis of a multilateral development bank (MDB). Persons and families whose houses were in the way of developing the roads were known as ‘Project Affected Persons’ (PAPs) and as per the policy of the MDB, the PAPs were to be rehabilitated in other parts of the city and provided with houses in keeping with Maharashtra state’s re-housing policy. Several PAPs in the eastern suburbs of the city were running shops attached to their homes and some of them were traders carrying out trades in their houses. When the PAPs were to be rehabilitated, they were only provided with housing. No compensation was awarded for loss of livelihood. The traders and shopkeepers subsequently protested against this.  In many cases, awarding compensation for loss of livelihood is not sufficient because economies are strongly rooted in locations. Clustering economies depend on and develop as a result of the economies existing in proximity. Moving any one of these economies from their locations impacts the larger economy.  Therefore, when slum dwellers are moved for rehabilitation and resettlement, their economic bases are destroyed and when they are moved to new locations, they have to start all over again, which may not be an easy task to achieve. Moreover, in the slums, individuals and families live in varying plot sizes. From a developmentalist perspective, it may appear horrifying that large families live in small plots. Interventions are planned accordingly to provide housing as per certain standards and regulations. Invariably, these standards come in the way of the economies developed by the slum dwellers. In Mumbai city, slum rehabilitation schemes mandate builders and developers to provide the inhabitants with houses measuring 225 square feet. Housing in slums is horizontal whereas housing developed under these rehabilitation schemes is vertical, thereby often deficient in terms of sunlight and ventilation. Slum rehabilitation policies must emphasize in-situ development rather than rehabilitate slum dwellers at urban fringes and develop middle and high-income housing on the land where the slum was previously located. Slum redevelopment can be undertaken by private contractors/builders and by slum dwellers themselves. Under the 1976 Societies Act, slum dwellers can undertake redevelopment themselves, without involving the builder as the agent of development, if more than 70% of the tenants of the housing colony come together and register as a society. In a novel design intervention, the design studio of the Collective Research Initiatives Trust (CRIT), a Mumbai-based collective of architects, teachers, students, activists and practitioners, participated in one such community self development project in Mumbai.  CRIT believes that the self-development model can save tenants’ societies several rupees, which then can be used to form a community corpus. This corpus can in turn support the tenant’s monthly outgoing, which for new developments in Mumbai can be prohibitive for urban poor communities. CRIT participated in the Betwala Chawl community self-development housing project. Betwala chawl is located in Central Mumbai. Squatters have been living in this area for more than 75 years and have been engaged in producing high quality wooden cane furniture and crafts. CRIT’s design model demonstrated that the surplus space from redevelopment can help tenants gain additional floor space for the use of the communities, thereby challenging the regulation that slum dwellers are entitled to houses measuring only 225 square feet under the slum rehabilitation-builder model of ‘free housing’.  Architecturally, CRIT’s design plans modulated the built structure to achieve a comprehensible urban form to carve out as large an open space as possible, with a perimeter building typology that defied the vertical building structures perpetuated by builders under the rehabilitation projects. CRIT attempted to tweak the building byelaws and existing policies in order to maximize programmatic space for low-income user groups. At the same time, CRIT was aware that urban housing policies, while addressing the issue of shelter, fail to connect housing to the fundamental right to work and ability of the poor to participate in the urban economies. It’s design plans attempted to account for this paradigmatic shift from an organized smoke stack economy into an informal, often home-based economy that has not yet been reflected in mainstream planning practices and housing policies. CRIT’s design intervention suggests that there can be more than one model for developing low-income housing apart from the state slum redevelopment and housing models. Policy makers, planners and architects therefore need to explore models that secure the poor with housing without impacting their claims to economy and right to work.

Law, Regulations and Development of Low-Income Housing: Legal regulations concerning land use, land acquisition and construction of buildings have varying effects on the development of low-income housing. As mentioned above, in Mumbai, the SRA-mandated model of slum redevelopment brought into force in the mid-1990s, drove several large and medium-level builders to undertake slum redevelopment projects because of the availability of development rights in lucrative parts of the city. Housing developed under such rehabilitation schemes have been of poor quality, causing inconveniences such as lack of electricity and water infrastructure to the rehoused groups. Those at the receiving end of such schemes and laws, Omar Razzaz (1993) suggests, then attempt to “re-redefine” the regulations to suit their conditions. Razzaz did not suggest this in a negative sense, but to indicate that there is a clear distinction between property rights and property claims in that a property right is an enforcement of relations between a person holding something of value with others by law, and when such property enforcements are brought into being, they are likely to impact different groups in different terms, producing winners and losers.  (341, 342) It is therefore useful to pay attention to the implementation of legal regulations on the ground, their impact on different groups and how these groups respond to the implementation.

An important factor in the development of low-income housing concerns land, which as mentioned in the introduction, is a contested terrain between the state, market and citizenry. Property is a dynamic entity in that its value keeps shifting over time. Thus, when a railway line is constructed around a certain piece of property, its value, which was initially nil/low, now rises in response to the creation of the infrastructure and the expectation of people flocking to the area to purchase houses and to set up commerce and industries. (Razzaz: 1973, 345, 346) With the growth of financial markets worldwide, there has been an increased investment in real estate. In fact, Joe Studwell (2007) in his work on the south-east Asian business tycoons points out that the tycoons often invested their idling millions into vast tracts of real estate so that these would reap benefits in future in case of rise in property prices. This, in part, saved the tycoons and their establishments from the south-east Asian financial crisis which otherwise wiped off the savings of the middle-income and poorer classes. There has also been an increase in construction conglomerates that are now involved in frenetic construction of townships and luxury apartments in major cities and islands across the world. In India, builders such as Hiranandanis, Rahejas, DLF, etc. have several resources at their disposal and play an important role in influencing the state’s land use and land acquisition policies. The portfolio of urban development and land is usually under the control of Chief Ministers across states in India, thereby making land a highly politicized domain. Large builders can usually bribe senior bureaucrats to pass contracts and legitimize land acquisition in contrast with small and medium-level builders who may not have similar resources.  When big builders largely dominate the market to the extent of eliminating small and medium-level builders, there is a clear impact on development of low-income housing (though, as we have seen in the previous section, it is not merely builders who help to create low-income housing and that poor groups themselves create low-income and spur rental housing). This also creates unfair competition in the land and property markets and often impacts poor groups leading to massive evictions, as was seen in Bangalore when the information technology industry was developing and infrastructure for the industry was being developed by the state government and other para-statal agencies. This may lead one to suggest that regularizing land titles can enforce security of tenure. But as Razzaz (1993, 349) suggests, legalization of tenures does not invariably bring security of tenure. “… a tenant in Cairo in a rent-controlled apartment might have more security of tenure than a first-time home buyer risking to default on his or her mortgage payments.” Quoting Doebele, Razzaz (1993, 349) points out that  “Security of tenure is not so much a legal category as much as the perception of the occupant of his security in relation to the investment contemplated.” This holds true in the case of Land Acquisition Acts (LAA) where the state can acquire land in the name of public interest. Under this LAA, state governments can acquire land as long as they can prove that such acquisition is in the general welfare of the public. Here, legal title is no guarantee that the state will not acquire the land under LAA. In one case, namely the New Rivera Co-op Housing (1996) 1 SCC 731, the Supreme Court passed a judgment stating that if the land is acquired for a public purpose activity, then it does not matter if such acquisition has been made at the expense of people’s right to shelter and livelihood.  Land acquisition acts for purposes of establishing industry (on agricultural lands) such as the Karnataka Industrial Areas Development Act (KIADA) can be even more draconian in that the land acquired is directly transferred to the company and those dispossessed of their lands have no option other than to accept the compensation awarded by the government.  Currently, agricultural lands located on urban peripheries are under the watchful eyes of industries as well as large builders to establish software parks, Special Economic Zones (SEZs) as well as townships and luxury apartments. This further infringes on low-income housing because earlier, slum rehabilitation housing was constructed by moving the slum dwellers from central city areas to the fringes of the city and now as urban fringes are gaining in property values for both industrial and housing purposes, there is a danger that the rehoused groups will be moved farther away.

Conclusion: In this paper, we have seen:

1.    That housing in the case of the urban poor is closely linked with their participation in urban economies; and
2.    That legal and institutional mechanisms such as land-use regulations and building bye-laws can invariably infringe on low-income housing, especially in a market which is mainly dominated by big builders.

Clearly then, there are various complexities to which policymakers need to pay close attention. Firstly, low-income housing projects need to bear in mind the claims of the urban poor to the economy via land. Consequently, in-situ slum redevelopment and housing is beneficial to poor groups because it preserves their economies and strengthens their claims on the city administration to provide them with basic infrastructure. In Indian cities, in-situ rehabilitation is highly contested especially when the slum is located on a high-value real estate location. In this case then, powerful builder conglomerates employ muscle power to displace the slum dwellers.  Housing policies such as the slum rehabilitation policies in Indian cities disrupt the economies of the poor thereby not only destroying their entrepreneurial drive, but also making it difficult for them to re-establish their economies in the new rehabilitated settlements. Policy therefore needs to view housing in the context of the urban economies that the poor spur and participate in.

Secondly, the Right to Information (RTI) Act, particularly the clause on Duty to Publish needs to be made mandatory on para-statal agencies that contract slum rehabilitation projects by awarding development rights to the builder to build commercial housing in other (usually lucrative) parts of the city. These agencies must provide up-to-date information on where the builder/s has used the development rights and to what extent. This can go some way towards preventing malpractices in the rehabilitation projects and forces builders to be transparent in their utilization of development rights. However, public agencies and builders do not wish to make this information public because this information is highly political in nature. In the past, an active citizen in Mumbai attempted to bring out this information by filing RTI applications with a para-statal agency in Mumbai. In response to his application, the agency responded by blatantly stating that it will not provide him with this information. This indicates that rehabilitation schemes are tainted with corruption and malpractices. In fact, the Slum Rehabilitation Authority (SRA), which is responsible for slum rehabilitation in Mumbai was recently closed down under charges of gross corruption and hand-in-glove practices with builders. Civil society groups working with squatters as well as citizens groups can use this information to hold both the state and market accountable.

Thirdly, there is a need to move beyond the presumption that it is the state and/or the market that can provide low-income housing to the poor and low-income groups. Across cities in India, migrant groups and poor groups residing in slums have created housing on their own. Through his work in Jordan as well as from empirical evidence from across the world, Omar Razzaz (1993: 350, 351) has found that slum dwellers and squatters invest in developing high quality housing because this reduces the chances of demolitions/evictions. This, among other factors, leads Razzaz (1993: 349, 351, 352) to conclude that there is “an assumed casual relationship between legal rights, security of tenure and investment in land.” Therefore, legalization of tenures can be a highly political project. In the urban context in India, the state, particularly the local administration plays a crucial role in legitimating these settlements to protect them in future from evictions/demolitions. This then means that municipal corporation needs to have substantial autonomy from state governments because eventually, the Chief Minister who heads the state government, controls the portfolio of land and urban development.

Finally, there is need for genuine free market in the builder industry i.e., all levels of builders – small, medium and large, must prevail in the economy at any point in time. This helps to ensure that there is potential to develop all forms of housing and not only luxury and high-income housing as we are currently witnessing in Indian cities. There is a need to conceive and develop policies to further this form of market. At the same time, there is a strong need for various groups among the citizenry to be aware of the legalities pertaining to land and to be vigilant to forms of corruption where the builder lobbies attempt to influence the political machinery in their favour.

Bibliography and References:

Benjamin Solomon and R. Bhuvaneswari (May 2001), Democracy, Inclusive Governance and Poverty in Bangalore, Working Paper 26 – Urban Governance, Partnership and Poverty, The University of Birmingham, May 2001.

Collective Research Initiatives Trust (CRIT) (2007),“Housing Typologies in Mumbai”, May 2007. Study also available on http://www.crit.org.in/projects/housing. Last accessed on 16th November 2007.

Razzaz Omar M. (Nov. 1993), Examining Property Rights and Investment in Informal Settlements: The case of Jordan, Land Economics, Vol. 69, No. 4., pp. 341-355.

Singerman Diane (1995), Avenues of Participation: Family, Politics, and Networks in Urban Quarters of Cairo”, Princeton University Press, Princeton.

Studwell, Joe, (2007) Asian Godfathers: Money and Power in Hong Kong and South-East Asia. Profile Books, London.

Liang Lawrence Land Acquisition: Towards a New Paradigm, a presentation, available on www.altlawforum.org. Last accessed on 6th December 2006.

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  1. PK
    October 2nd, 2008 at 20:49 | #1

    Hi Zainab,
    is this your own article? Also, I couldn’t locate your profile on these pages as I wanted to know more about your work.

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