A report on the evaluation of the Real Estate Policy 2019 of Madhya Pradesh - towards the partial fulfillment of credits for the course UPC3.1- Urban Development Management & Governance at the School of Planning and Architecture, New Delhi (October 2020)

1. MADHYA PRADESH
REAL ESTATE POLICY, 2019
PRASAD DIPAK THANTHRATEY | SPA/NS/UP/1409
RUTIKA KIRAN HEGE | SPA/NS/UP/1415
UPC3.1: URBAN DEVELOPMENT MANAGEMENT & GOVERNANCE

2. OBJECTIVES
Achieve simplification of
permissions & clearances
Enhance ease of doing business;
reduction in transaction time &
costs
Improve transparency in
decision-making; execution by
accountability
Attract new investments &
expand employment prospects
Contribute to the growth of
planned neighborhoods &
livable cities
• The policy was approved on 15 October
2019 by the state cabinet.
• It aims to cut down the red tape- number
of the documents to be submitted by
developers for their projects to 5 from 27
• The minimum 2 hectare norm for
development of a colony has been
revoked. A developer can now develop
a colony on a smaller piece of land,
which will curb illegal developments.
• ‘One State One registration’ - the
permission for development will now be
valid for five years and the license for the
purpose will remain effective across the
state - real estate companies to have
one license for the entire state.
Completion of the colony in 3 phases.
• The policy offers Floor Area Ratio (FAR)-
free zones on the outskirts of big cities to
ensure development of new areas
coupled with other incentives.
Immediate permission of small
accommodations to citizens.
• Exemption have been from the non-
compliance of EWS/LIG construction to
encourage new investors and
developers.
SALIENT FEATURES OF THE POLICY
The Real Estate Policy envisions bringing
in path-breaking initiatives for the sector
with the following objectives:
• Procedural Simplifications
• Planning and land Management
• DCR and Building byelaws
• Affordable Housing
• Fringe Area Development
• Digital Infrastructure for Real Estate
• Special Provisions/exemptions
• De-duplication of departmental roles
TOOLS OF THE POLICY
PROCEDURAL SIMPLIFICATIONS & STREAMLINING
Issuance of completion certificate
Waiving off ‘Dual Shelter Tax’
Nazul NOC waiver
Integration of registration and mutation
One State One registration
Money value of time as a concept needs to be
promoted to avoid delays and cost escalation.
Hence, this following procedures have been
restandardized- to promote the establishment of
an efficient fast-growing business environment.
Powers for sanctioning, planning and building
permission for structures up to a certain height
and area shall be delegated to competent
professionals, empaneled at the district level as
per competencies mentioned in Bhumi Vikas
Niyam 2012.

3. DCR & BUILDING BYE-LAWSPLANNING AND LAND MANAGEMENT AFFORDABLE HOUSING
RISK BASED CLASSIFICATION OF BUILDING
PERMISSIONS
Base FAR reductionFAR
•Reduction in base FAR to benefit the TDR
policy creating higher demand for FAR
Community Spaces and AmenitiesAmenities
•Re-defined as per Bhumi Vikas Niyam(2012)
w.r.t. scale of project/land area and citizen
convenience
Optional EWS ConstructionEWS
•Unified rules in ULBs for construction of EWS
•construction of EWS units not mandatory.
Option for building EWS or money deposit by
developers in lieu of EWS houses
Layouts
DCR: Development Control Regulations
Promotion of Form Based Codes
• Fee calculation only upon areas if where
there is deviation from approved layouts, this
reduces expenditure incurred due to
changes
As per NBC for classification of residential,
industrial, commercial, institutional buildings etc
Green belts as open spaces as per Bhumi Vikas
Niyam(2012);
Utilities (such as overhead tanks, STPs & electrical
transformer) shan’t be permitted on designated
open spaces
Incentivisation of landowners through ‘Green FAR’
or TDR benefits
Benefits To Stakeholders
• Exemption from non-compliance to EWS.
Optional- as builders may deposit a fixed amount
with the govt. , which will get added to CM Awas
Yojana to construct homes for the poor.
• Fast track approval - For smaller houses,
permission will be given instantly (within 30 days).
• The previous provision of a min. req. of 2-hectare
plot for colonizing is revoked. This will decrease
the problem of illegal colonies.
• Need based rental housing at affordable prices
is encouraged for all sections of society, in sync
with the National Urban Rental Housing Policy
2015.
• Incentivize construction of studio/micro
apartments in high density or high rental zones.
Benefits To Developers
• Reduced/Exemption of fees - Affordable
housing schemes by private developers shall be
incentivized by reducing or waiving altogether the
fee payable as development charges obtaining
planning and building permits for the affordable
housing sectors in projects.
• Density Bonus – for contribution of EWS/LIG
beyond mandatory provisions developers to be
given increased FAR as bonus in specific
commercial/residential areas
• Large no. of small real estate developers
encouraged to form consortium for big scale
projects. Consortium so formed will be the master
developer
TDS
formulation
•Clear indication of prospective areas under
TDS in Development plans
•Empowering of ULBs/agencies to ensure
speedy execution of schemes.
•ULBs/development authorities to check for
available infrastructure and phased
development
Optimum
density
utilisation
•Areas that can sustain high densities to be
marked in DP
•Incentives to developers achieving it by
increasing FAR of such areas
Land
Monetisation
•Identification of under-utilized and unused
land parcels on DP making it available for
dev.
•Urban re-densification & urban renewal
schemes to be promoted
•Land pooling, return of excess land,
transparent land valuation - promoted for
land acquisition
Large scale
developments
•Expedite implementation
•Exemption from ‘change in LU’ to PSP areas

4. FRINGE AREA DEVELOPMENT
Permissions to Developers
•Construction permissions for colonizers different
in rural and urban areas being abolished.
Same rules to be followed now
•Builders with 5yr license can construct upon
rural and urban areas
Development Control Regulations in
Rural Areas
•Bhumi Vikas Niyam(2012) not applicable to
rural areas resulting in unplanned growth
•Enforce development control regulations in
rural areas
Metropolitan Planning Committee
•MPCs for million plus cities with their roles
followed as per 74th CAA
Planned development in Peri Urban
areas and Satellite towns
•Formulation of norms for satellite towns and
rural continuum for a planned development
without additional stress on infrastructure
Earmarking FAR Free Zones in
planning area boundary
•Creation of FAR free zone on planning area
boundary for commercial, IT parks,
entertainment hubs
•Results in investment attracting new
developers, creates employment
DIGITAL INFRASTRUCTURE FOR REAL ESTATE
Landowners/
consumers
Developers/
Private
players
Govt
agencies
Town & Municipal
Administration
Benificiaries
SM-RE@di
SMART MP REAL ESTATE DIGITAL
INFRASTRUCTURE FRAMEWORK
Acces
sibility
Result
driven
proces
s
Auto-
matio
n
Secure
&
reusab
le
Inter-
operability
Technologically assisted digital services in Real
Estate domain from land ownership to financial
digital asset ownership enabling virtualization of
operational processes to Smart Real Estate.
The interface creates an integrated platform in
conjunction with current e-Governance systems
ABPASS, ALPASS and others at District, Tehsil,
Panchayat and State levels.
Open Data Source ensures inter departmental
operability and shares real estate databases
Creation of e-
property ID
for Lineage
Legacy of land
•property ID shall help in
defining lineage of property
and ownership title.
•All documents to be
digitized and Aadhaar
linked e-Property Card to
become single
source/fundamental asset
to get further e-
documents/certificates
Preventing
Illegal
Colonization
•Registration of sale and
purchases to be linked to
concerned databases to
curb fraudulent
transactions
•Disputes to be linked via
block chain technology
Real Time
Status
Monitoring
•The approval process
attached to unified real time
system to monitor all projects
status
•Approval to be sanctioned
as ‘deemed to be
permitted’ in case of non-
adherence to time limit by a
government department.

5. TRANSPORTATION PLANNING
Transportation is a catalyst to the development
of the real estate sector. Feasibility of a project
depends on its locational proximity and linkages
with transportation.
TOD (Transit Oriented Development)
Developing Nodes & Corridors
Implementing Master Plans &
Building Approach Roads
Use of Technology (implementing
Master Plans & Building Approach
Roads or Parking
Route Rationalisation for Public
Transport
Traffic Impact Studies
Setting up of Logistics Ports and Dry Ports at
strategic locations to boost real estate dev.
In peri urban areas
STREAMLINING & DE-DUPLICTION OF OVERLAPPING ROLES OF GOVT DEPTS/AGENCIES
Due to undefined roles and unclear procedures, many departments end up performing tasks other
than assigned works. This has created a labyrinth of procedures and backlog in the development
concerned.
Hence the policy envisages clarity in the role of stakeholder departments and agencies.
•They shall be treated as Master Developers.
•To work on implementing the master plan, providing
affordable housing and facilitate end users.
Development Authorities/ Housing and
Infrastructure Development Board
•Automated Layout Process Approval and Scrutiny System
(ALPASS) shall be implemented for rural & urban areas.
•Revenue records to superimposed with all khasra details
on the digital GIS based development plans.
Town and Country Planning Department
•Online portals- updated with all permits to be granted
online and within time frame.
•ensure provision of municipal facilities in new developed
areas for providing a conducive living environment
Urban Local Bodies and Panchayats
•a Judicial officer shall be empowered and to posted at
the authority act as an Executing Officer to ensure
recovery of interest, penalty and compensation.
RERA Order Implementation
•Revenue Dept- update all land records in co-ordination
with digital dev plans as prepared by T&CP
•Energy Dept- promotion of EVs ,solar devices, charging
infrastructure, RWH systems, other sustainable tech, etc
Other Administrative Departments and
Agencies
•Infrastructure development as per Development Plan and
in upcoming greenfield developments
•Commercial real estate in Tourism & Entertainment sector,
Heritage Conservation, through Public Private Partnership
Role of Private Sector And PPP

6. ADVANTAGES: SPECIAL PROVISIONS AND
EXEMPTIONS TO FACILITATE REAL ESTATE
The mortgaging of plots / units with
the Urban Local Bodies shall be
rationalized to ease the pressure on
the developers
Encourage collaborative
economy in real estate sector
Eg – commercial spaces
rented for shared/co-work
spaces/short term rental -
boost startups
Re registration fees relaxed –
in case of change of
ownership during construction
The stockholders of a Real Estate
Investment Trusts (REIT) earn a share
of the income produced through real
estate investment – without having to
go out and buy, manage or finance
property.
Such initiatives shall be encouraged
for sustaining large scale projects in
the sector
OTHER BENEFITS OF THE POLICY SHORTCOMINGS OF THE POLICY
Higher employability aspects for the
vocational technicians working in
allied fields of real estate
Promotion of indigenous art and
architecture
Increase in the Intake of Professionals
in Government Departments
Capacity enhancement of existing
professionals through Centre for Urban
Governance (CUG)
FDI- Reduced BUA for FDI to improve
Ease of Doing Business by PIO & NRIs
Higher accountability due to
exclusive responsibilities, improved
efficiency due to ingress of e-services
• RESIDENTS WELFARE ASSOCIATIONS :
There is no separate policy for the
governance and internal management
of Residential Colonies to protect the
post-purchase and maintenance
aspects of colonies handed over.
• DEARTH OF PROFESSIONAL STAFF: The
policy suggests decentralising
responsibilities to various departments
but doesn’t mention about increasing
the staffs.
• EWS/ LIG HOUSING: The policy has
made it easier to neglect these housing
by developers in exchange of money
towards CM Aawas Yojana, but its own
functioning & delivery time of dwelling
units are delayed & questioned.
• Regulation requires approvals and
permissions which may result in delay of
starting/finishing of projects
• CONFLICTS OF INTEREST: between the
various authorities of Transport
infrastructure & the ones involving real
estate- multiplicity of organisations
would still be an issue.