Pinnacle

We have hearing it for years now. The repeal of the infamous ULC Act, happening in Maharashtra. Seems finally the time has come. But even now, no one is sure when its actually going to happen ?

Any ideas on what will be the trickle down effects of Scrapping the ULC Act in maharashtra ?
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WHEN THE TALKING STOPS
Supriya Khandekar, Mumbai, November 5, 2006
The Economic Times

After talking about it for a long while, the government could finally move towards scrapping the Urban Land Ceiling and Regulation Act (ULCRA). The government proposes to repeal the Urban Land Ceiling in the coming winter session because of pressure from the Centre, which has linked the Jawaharlal Nehru Urban Renewal Mission (JNURM) funds to the state scrapping the ULCRA.

Mukesh Patel, 'Knowledge Worker', Neelkanth Group, says, "The decision will certainly have a positive effect in the long run. This move of the Maharashtra government is in the interest of the people. But I do not think that prices will come down so soon as the government says, but they will certainly stabilise." He adds, "Infrastructure funds withheld by the Centre would get released which will, in turn, help improve infrastructure in the city."

The Centre could withhold as much as Rs 28,000 crore of National Urban Renewal Mission (NURM) funds, while funds from the World Bank also could get stuck in the absence of reforms like abolishing the ULCA.

Under the ULC act, land in excess of 500 sq metres under a single private ownership can be acquired by the state. According to the state government this act has locked acres of land in several urban conglomerates across the state.

"What matters most is the manner in which laws are implemented. There have been similar announcements by the government even earlier but as they were never followed; speculation cannot be done even this time. No one knows how far the execution will be," says Abhinandan Lodha, Director, Lodha Group. He acknowledges, however, that if it is implemented effectively, the market will certainly see stability of prices and a great deal of land will be available for housing.

Akash Deep Jyoti, Head, Corporate and Infrastructure Ratings, CRISIL, explains: "ULC has been largely responsible for the lack of transparency among developers. The biggest loophole has been that builders never own the land in their own name. This has contributed to delays in land conveyance to the society etc. The negative impact of the ULC legislation has been more." He adds that as more urban areas get developed, revenues of Local Corporation and state government would increase and some of this revenue can be used for the welfare of the people.