One Nation One Housing Policy & Role of Controller of Land Compensation Bonds

CONCEPT NOTES FOR ISSUANCE OF LAND COMPENSATION BONDS

INTRODUCTION :

There are two inequalities in the current format of housing. One is landed gets FSI and landless never gets. Among the landed also for the same FSI, creating land, the values are different and per acre it is between 600 Crores to 10 lakhs. How to evolve a common policy so that millions of houseless households can be given their shelter. The land price in housing is hovering around 35 to 90 % of the total cost. Even in the tough Covid times we see large ticket transactions, for example in Malabar Hill for 1000 Crores for few acres and a 32000 Sq. ft. plot in Calcutta went for 100 Crores and 1700 Sq. ft. flat in Worli went for about 17 Crores meaning per Sq.ft. 1 lakh rupees. Also some builders want to sell 188 Sq. ft. flat for one crore. A car park was sold for 25 lakhs, this is the upper end scenario.

There are lot of literatures available for land compensation bonds. But they cannot be practised for India. We are bringing about 30 Crore families either marginal titled or houseless or rent payers or first shelter seekers to main stream and this calls for a new approach with right to shelter as the theme and not as commodity and about 30 more parameters prescribed by United Nations have to be followed.

After lot of thinking we have come to a conclusion that 150 Sq. ft. of FSI at cost of construction basis and 50 Sq. ft. of undivided share of land or equivalent should be the birth right for every Indian citizen. Adequate housing is described as 1200 Sq. ft. FSI for 8 member family and 400 Sq. ft. UDS as basic requirement. For those who cannot pay should be falling under Ministry of Social Welfare on same terms. We keep insurable interest same. An insurable interest is described as number of ordinary citizens living in a acre of land and the cost of land and building and movable assets and we have kept as 150 Crores both for Ministry of co-operation and social welfare at 800 citizens per acre land at 2.778 FSI and 120000 Sq. ft. constructed area at 2500 per Sq. ft. valuing 30 Crores and movable at 20 crores and life at 10 lakhs for 1000 people at 100 Crores will sum up to 150 Crores. Accordingly land compensation bonds structured at 15 % of the value of construction and one cent of land UDS given free to each household, and 1 Crore bond face value with 5 year maturity and at 5 % tax free (25 Lakhs non­transferable and non-negotiable tax free coupons detachable), and 5 % GST free for 30 Crores valuing 1.5 crores and assignment rights at 100 rupees for land measuring 43200 Sq. ft. at 43.20 lakhs as base and for assignment rights of FSI of120000 Sq. ft. at 100 rupees per sq. ft. will fetch 1.20 Crores. This will sum up to 100 lakhs bond value plus 25 lakhs Tax free income plus 150 lakhs as GST benefits plus 120 lakhs as assignment rights for FSI and 43.2 lakhs for assignment rights of land and which will total 438.2 lakhs for each acre. Let us put in table format to achieve 1 Crore bond how much land will be required at different FSI from 2.778, 2.5, 2, 1.5, 1, 0.75, 0.5 and .02778. Similarly in another table we will find out in one acre land with different FSI at 2.778, 2.5, 2, 1.5, 1, 0.75, 0.5 and .02778 and how much bond can be issued and the sum total of benefits.

TABLE (1) TO ACHIEVE 1 CRORE BOND HOW MUCH LAND WILL BE REQUIRED
AT DIFFERENT FSI FROM 2.778, 2.5, 2, 1.5, 1, 0.75, 0.5 AND .02778.

RATIO OF LAND COST IN TOTAL COST IS 4,38.20 LAKHS / 3000 LAKHS IS 14.60 % IS THE NATIONAL AVERAGE LAND COST FOR A

NATIONAL AVERAGE CONSTRUCTION COST OF 2500 RS. AND ACCORDINGLY THE LAND COMPENSATION BOND IS STRUCTURED FOR THE USAGE MINISTRIES.

TABLE (2) IN ONE ACRE LAND WITH DIFFERENT FSI AT 2.778, 2.5, 2, 1.5, 1, 0.75, 0.5
AND .02778 HOW MUCH BOND CAN BE ISSUED

YOU WILL FIND THE COST OF LAND AND COST OF CONSTRUCTION RATIO AT 14.6 %

CONCLUSION :

We request to institute the Controller of land compensation bond and let him come with a ready reckoner table on these lines working with credit rating agencies RBI, Finance secretary etc. In the harmonised master list of department of economic affairs must include this as a means. RERA brokers, chartered accountants, Lawyers and Escrow accounts should be the modus operandi. Transfer deeds with all coordinates and metrological report, structural engineers report, soil report, seismic records and water table should give the correct FSI index a land parcel deserves. Brokerages must be paid to all intermediaries and for listing. The bond becomes a zero coupon bond of 5 year maturity and comparable with other bonds.