Under pressure from the builders’ lobby the state government on Saturday issued orders relaxing several provisions by amending its earlier order (GO No. 45). The order had made it mandatory for builders to provide 20 per cent of the total built-up area in private layouts for housing to economically weaker sections (EWS) and lower income groups (LIG). The powerful builders’ lobby had brought to halt almost all the big housing projects in the state for the past one-and-a-half-years causing losses running into crores to the exchequer, and that is considered the reason behind the state’s move.
The state issued GO No. 245, dated June 30, 2012, offering relaxations and incentives to the builders. The 20 per cent quota has been reduced to 10 per cent with five per cent each to EWS and LIG respectively, or 25 per cent of the total number of units (12.5 per cent each to EWS/LIG). The builders have been given a choice between 10 per cent built-up area or 25 per cent in terms of units.
The major amendment to the earlier GO is that the minimum plot size has been increased from one acre to five acres (2.023 hectares) for the EWS and LIG clause to be applicable. This is more than expected for builders who were demanding one hectare as minimum plot size. What’s more, the builders and developers will be exempted from payment of 10 per cent of the total city level infrastructure impact fee on the main project in lieu of EWS/LIG quota. Also, the builders can use 10 per cent of land or area equivalent to EWS and LIG housing for any purpose other than residential in the main project site. However, these concessions shall apply only for those projects where EWS/LIG units are provided in-situ within the site.
Another demand of builders that has been okayed is that they can construct EWS/ LIG housing within 10-km radius of main project site, or within 5-km aerial route boundary of the respective municipal corporation of Greater Hyderabad, Greater Visakhapatnam and Vijayawada. In case of other Urban Local Bodies, the radius is 5 km from project site, or within 5kms from the nearest aerial route boundary.
The government has also given the developer or builder the option for procurement of EWS/LIG units from the housing projects being developed by the AP Housing Board with the 10-km and 5-km radius rule applicable. Moreover, two or more builders can construct their quota of EWS housing at one place other than main project sites but the occupancy for the main projects will be released only after completion of the EWS/LIG projects.
Though government exempted 10 per cent EWS and LIG reservation clause to housing projects coming up in more than 3,000 sq metres and up to 5 acres land (plot size), the builders have to pay “shelter fee” per square metre. Even though the builders welcomed the relaxations, they wanted the government to give them free hand in selling EWS/LIG units in the open market.