May stop LOI trading in SRA if construction fails to begin: Maharashtra CM

Mumbai: Raising concerns over the "misuse" of the Slum Rehabilitation Scheme (SRA), Maharashtra Chief Minister Devendra Fadnavis on Saturday said it might consider discontinuing trading in Letter of Intent (LOI) if construction work doesn't start.

"In the last few years we have seen trading in LoI and no construction on ground. If this continues we may discontinue trading in LOI," he said at the Credai-Bankcon Summit here.

In cases of redevelopment under the SRA, a developer secures consent of the tenants in the LOI. Trading in LOI hurts construction activity on ground as builders keep changing for a certain housing project.

The CM said there is tremendous interest from the financial institutions to lend to affordable housing sector.

"Last week, I met the Canadian Ambassador, who said that CPPib is interested in investing nearly USD 2 billion in affordable housing system. There is a lot of interest from other financial institutions to invest in this sector," he said.

The government has set itself a target of providing 11 lakh affordable houses in the next 5 years.

"We are working on our affordable housing policy and in the next 15 days we expect to announce a part of this policy," he said.

Fadnavis said his government was supposed to announce this policy in May itself but we were waiting for the Centre's housing policy so that we could align our policy with them.

He also urged the developers to undertake affordable housing projects and said work on providing three lakh houses in the MMR should start next year.

"I assure the builders that we will make all the approval process hassle-free for them if they develop affordable housing," he said.

Fadnavis also said the BMC will announce its policy on ease of doing business next month.

He said there is a need to reduce human intervention and we need predictability, transparency and accountability in the way we deal with it.