Maharashtra government officially approves Rs 23,000 crore Dharavi slum redevelopment project to Adani Realty

The Maharashtra government has approved Adani group's bid for the redevelopment of Dharavi's slums in Mumbai. The Eknath Shinde-led government has issued the government resolution (GR) in this regard on Thursday.Last year, Adani Group's Adani Properties had emerged as the highest bidder for the 259-hectare Dharavi Redevelopment Project.

The GR is formal notification from the government which would help the group to start work on the project.  The GR has been issued by the Housing department and has instructed all the government departments to issue their orders within a week.This should come as a shot in the arm for the Gautam Adani-led Adani Group, which has been jolted by US short-seller Hindenburg Research's report in January where it accused the conglomerate of improper use of tax havens and expressed concerns over its debt levels.The conglomerate had put in a Rs 5,069-crore bid for the redevelopment of one of the largest slum sprawls in the world, outbidding DLF, which had quoted Rs 2,025 crore.The project, expected to cost around Rs 23,000 crore, will be one of the largest redevelopments by a government agency in India through global tendering.

The total timeline for the project is seven years to rehabilitate the 6.5 lakh slum dwellers who are spread over 2.5 sq km area right now.The project, which will help Adani Group to book high revenues by selling lakhs of square foot of residential and commercial space in central Mumbai, has been in limbo for many years now because of its complexities.Eight bidders, including entities from South Korea and the UAE, had attended a pre-bid meet held in October 2022 and three of them actually bid for the project. Naman Group, a city-based developer, was the third whose bid did not qualify.The government has sought a consolidated net worth of a minimum of Rs 20,000 crore to choose the winning bid.Adani will be required to form a special purpose vehicle (SPV) for executing the project, and a staggered timeline of investments has also been stipulated by the government. The developer has to take care of rehabilitation, renewal, amenities and infrastructure components.