Lavasa exposed

Lavasa is a destination for the well-heeled, upwardly mobile, aspiring for quality life. The streets bear names like Thicket and Celosia (an ornamental plant); the village that the town replaces—Dasve—has become the Dasve boulevard. The town centre boasts a town hall that does not resemble any municipal office but a corporate office, headed by an American designated town manager. Numerous buildings are at various stages of completion in about 700 hectares (ha). If completed, Lavasa will occupy about 5,000 hectares along the edges of seven hills in the Sahyadri range of the Western Ghats. Its unique selling point is its waterfront, provided by the backwaters of Warasgaon dam on the River Mose.

Ministry softens stand

Construction work at Lavasa was on full swing till November 25 last year when the Union Ministry of Environment and Forests (MoEF) intervened and issued a stop-work order and notice to Lavasa Corporation Limited (LCL), mostly owned by construction major Hindustan Construction Company. Reason: the company had failed to obtain environmental clearance from the Union ministry. It had proceeded on the basis of a clearance from Maharashtra’s environment department.

In March first week, the ministry’s Expert Appraisal Committee (EAC) for new infrastructure projects and Coastal Regulation Zone said that planning and development of the whole project should be reworked and its environmental impact assessed afresh. At the same time the ministry also recommended permission be given to complete the semi-finished buildings being built as villas and apartments. It clarified that structures that did not reach plinth level, should not be allowed. The move to regularise illegal constructions is at variance with the ministry’s findings over the past four months.

Dasve town’s waterfront was created by building a weir (Photo: Arnab Pratim Dutta )

An expert committee constituted by the ministry on the directions of the high court at Mumbai, comprising Central and state EAC members and MOEF officials, had visited the project site in January. The committee’s report, dated January 13, confirms the violations of environmental laws, including haphazard cutting of hills.

The ministry had stopped work and constituted the committee in response to the public interest petition moved by the National Alliance of People’s Movements (NAPM), formed by activists and NGOs, in the high court of Mumbai. Lavasa challenged the ministry’s order in the high court, saying it had taken the requisite clearances from the state and the ministry had no jurisdiction over the project. The petition named environment minister Jairam Ramesh and two ministry officials in person.

LCL later applied for post facto clearance from MoEF for the first phase of the project, on February 1; Lavasa is being developed in two phases of 2,000 ha and 3,000 ha. While seeking clearance from the ministry, the company argued it has already spent about Rs 3,000 crore on the project and investors have gained third party rights in the city. The project has brought employment and development to a neglected area, LCL said.

Stone quarrying has dried water sources of villages (Photo: Arnab Pratim Dutta )

EAC said it was ready to consider post facto clearance on certain conditions, which include a penalty for violating laws and creation of an environment restoration fund by the company. EAC observed that substantial development has already taken place in about 700 ha. “In view of this and considering all related consequences, there is no other alternative before EAC, except appraising the project post facto,” the panel said.

But activists are unhappy with EAC’s recommendations. On March 10, NAPM moved court, challenging the retrospective clearance. “There is no provision in the Environment Protection Act for post facto clearance. At the time of issuing show cause notice on November 25, MoEF had asked the company why the unauthorised structures should not be removed. They cannot legalise it now,” says Vishwambar Choudhari of NAPM.

“The Adarsh housing society in Mumbai was ordered to be demolished under Section 5 of the Environment Protection Act. The same law applies to Lavasa,” adds Choudhari.

EIA notifications flouted

LCL has denied charges of violating environmental laws.

The environment department of Maharashtra gave the final clearance to LCL in March 2004 under the Maharashtra Hill Station Regulations of 1996. The company did not apply to the Centre though the Environmental Impact Assessment (EIA) notification of 1994 mandated clearance from MoEF for tourism-related projects between 200m and 500m of high tide line and for projects at an elevation of more than 1,000m from sea level, involving investment of over Rs 5 crore.

Since 58 ha of Lavasa city is above 1,000m height and the project cost more than Rs 5 crore, LCL ought to have applied to the Centre for clearance. Further, the mandatory public hearing and assessment of EIA report (see ‘EIA reports raise alarm’, p31) and environment management plan by EAC were bypassed.

The state, in fact, misled the Centre on the applicability of EIA notification on Lavasa. In July 2005, MoEF had written to the Maharashtra environment department saying the project attracts provisions of EIA notification and asked it to ensure all clearance processes are followed. The member secretary of the Maharashtra Pollution Control Board replied that the project did not require clearance from the Centre because it was at a height below 1,000m. The state environment department’s letter to the ministry in August 2010 reiterated this stand. The letter said EIA notification of 1994 did not apply to the project as all constructions were between 640m and 900m altitude.

A senior official in the Maharashtra Pollution Control Board confirmed the ministry’s letter was ignored by the state. When the case was revisited after the MoEF stay order, the original copy of the ministry’s letter was found missing from the files of the board and the environment department. “When the letter could not be found, LCL gave us a duplicate copy,” the official said, implying the company was aware it needed environmental clearance from the Centre. But in its affidavit in the high court, the developer claimed otherwise.

The company claimed the amended EIA notification of 2004, too, did not apply to the project. The notification said “all new construction projects”, including townships and colonies meant for more than 1,000 persons or involving an investment of more than Rs 50 crore, need the Centre’s environment clearance. When this requirement was pointed out in court, LCL argued the project was not a “new project” because it had sufficiently progressed by 2004 when the notification was issued. But the documents submitted by LCL to the ministry show the company obtained the first permission for construction only in August 2007.

A letter by Pune’s assistant director of town planning, dated November 2008, has clarified that Lavasa qualified as a new construction project. The investment made by the company as on July 7, 2004, was less than 25 per cent of the cost, a condition for an industrial project to be considered a “new construction project”, requiring clearance from the Centre, the letter says.

The developer also ignored the provisions of the EIA notification of 2006, which supersedes the previous two notifications. The notification says all townships and area development projects, covering an area of over 50 ha, commenced or upgraded after September 2006, need environmental clearance from the respective state EIA authorities. Since Maharashtra’s State Environment Impact Assessment Authority was constituted by MoEF in April 2008, all new projects should have been appraised by the Centre till that time. But the developer chose to apply to the Maharashtra EIA authority in August 2009. This proposal was too late and by then the environment had been damaged, as MoEF notes in its order dated January 17.

The damage report

The site inspection of MoEF notes that the company has resorted to large scale hill-cutting to extract construction material and for making roads. This has rendered the hills barren. The Pune collector had granted LCL lease to quarry minor minerals like stones. The ministry report says “the haphazard hill cutting is expected to result in landslides, high erosion, and consequent siltation of water bodies.”

The ministry EAC, too, endorsed these findings in its meeting on February 14 and 15. “The removal of deep-rooted trees and large rocks would lead to landslides in the event of intense rainfall or cloudburst. Any such occurrence may result in total destruction of the buildings and will have potentially grave threats to buildings down slope,” read the minutes of the meeting.

Lavasa, in its submissions to the ministry, said using locally available construction material was more ecofriendly than transporting it to site. People living in the area disagree. The blasting of hillsides for quarrying stone has spoilt their water sources. “Many springs in the region have dried. We get very little water now,” says Leelabai of Mugaon village, one of the 18 villages affected by the project.

Planning norms violated

Lavasa has also flouted state rules. Its plan does not conform to the procedures in the Maharashtra Regional and Town Planning Act of 1966, which include inviting public objections and obtaining approval from the state government. MoEF’s site inspection report notes there is no approved landscape plan, parking and circulation plan or baseline environmental information within and around the site.

The city’s master plan is essentially a layout plan for 580 ha which was approved by the Pune collector in 2006. This was revised by LCL after it was appointed Special Planning Authority (SPA) by the state government in June 2008. This bestowed LCL powers to sanction its own plans.

Once the developer acquired the powers of a planning authority, it modified the layout plans. The hill station regulations do not allow construction on steep slopes. This made LCL shift most of the development in the valley. The original hill station policy permits only two storey buildings; Lavasa structures have six storeys. This was achieved by transferring the floor space index (FSI) of the buildings that would have come up on the slopes to the buildings in the valley. “By interpreting the global (floating) FSI to their benefit, they have almost doubled the floor space in 80 per cent residential area,” says an official in the town planning directorate of Pune.

Another major planning violation is that the buildings are almost touching the water body; the state government had permitted LCL to construct at a distance of 50m from the reservoir which was reduced to 30m and then 15m. At site, the concrete pavement almost touches the reservoir. The developer allegedly reclaimed land from the reservoir bank. All this may have a negative impact on the flora and fauna of the water body, says MoEF’s site report.

The Maharashtra Krishna Valley Development Corporation, the water resource department of the state, had leased 141.15 ha to LCL to build checkdams. LCL used a portion of the leased land which was above the submergence zone to construct commercial and residential buildings.

Residential: Laws changed to allow construction on steep slopes. Height of apartment buildings increased from Ground (G)+1 to G+4, some adjacent to water body. Commercial: Laws changed to allow mixed land use—commercial and residential—in the town centre. Height of buildings was increased from G+2 to G+5, which was illegal in the original hill station policy Water: Check dam at the mouth of Dasve. Buildings and roads close to the water body, at 5 to 15 metre distance. Oil and sludge from vehicles and runoff could affect lake’s water quality. Land reclaimed to set up the waterfront commercial area Lavasa’s population density is likely to be 4000 persons/sq km Hospital: No plans for disposal of bio-medical waste on-site. Biomedical waste to be transported but no studies done on its impact.

Water at Pune’s cost

The Warasgaon reservoir is integral to Lavasa’s landscape and its water needs. In an undated white paper on the township’s water use, distributed to the media, Lavasa claims water usage would not affect downstream Pune.

Eight check dams are being constructed by LCL upstream of Warasgaon dam to store water for the project. Two dams are already constructed in the water body; the remaining six are to be built in the catchment of the dam. These eight dams will store 24.67 million cubic metre (MCM) water, which is around seven per cent of the storage capacity of Warasgaon dam. MoEF fears the checkdams will reduce the flow of water in the main reservoir.

The Warasgaon dam contributes to the Khadakwasla dam which provides drinking water to Pune. LCL claims the water requirement of Lavasa is minuscule compared to the water requirement of Pune. The current requirement of water for Pune is about 325 MCM. All of this is met by Khadakwasla Dam where water from three dams, including Warasgaon, converges. Warasgaon contributes about 373.9 MCM water and Khadakwasla releases 1041 MCM for various uses, including Pune’s water supply. B G Ahuja, Pune-based former engineer with the Central government, says with the increasing population, Pune will face water crisis. “By 2021, water requirement of Pune will exceed the storage capacity of Warasgaon dam. During the summers, the Warasgaon dam reservoir dries up and Pune suffers from water crisis. From where will Lavasa get water then?” asks Ahuja.

LCL informed the ministry that Lavasa hill station is a part of the final Regional Plan for Pune Region and its water requirements are considered while permitting the development. It said the Pune Municipal Corporation will recycle the water it draws from Khadakwasla dam and reduce distribution losses to 15 per cent from current level of 40 per cent. What’s more, the supply norms for Pune may need to be reduced from 300 litres to 125-200 litres per person a day.

Lavasa acknowledges in its red herring prospectus, filed at the time of initial public offer, that water scarcity may be problem for the township. Their contract with state water resources department states that under extraordinary circumstances Lavasa has to release water from the two check dams built at Dasve and Gadle, which comprise about 27.5 per cent of Lavasa’s water supply. In April and May every year, the Warasgaon dam nearly dries up before the monsoons begin. Not just Pune, Lavasa, too, could be reeling under severe water shortage.

Lavasa spokesperson Ashwin Shetty refused to comment, saying the matter is sub judice. MoEF is, meanwhile, working out the penalty amount and the restoration fund LCL will have to pay.
 

See Also>> Lavasa’s journey downhill

Lavasa is called a hill station but does not offer the cool comfort of one. In May and June temperatures touch nearly 40°C— not an ideal summer getaway. In nearby Mahabaleshwar, temperatures rarely cross 35°C.

Then what prompted the city’s developer, Lavasa Corporation Limited (LCL), to promote it as a hill station? The answer lies in the state’s Special Regulations for Development of Tourist Resorts/ Holiday Homes/Townships in Hill Station Type Areas. The law, notified in 1996, allows a developer to choose 400 ha to 2,000 hectares (ha), at an appropriate height with suitable topographical features, and get the state to declare it a hill station. LCL got the government to tweak this policy to permit it to construct as it wished on the reservoir front and valley areas.

To promote tourism, the regulations give developers certain concessions. “The rules relaxed the conditions for the transfer of tribal land and agricultural land for industrial purpose. The law was introduced to circumvent regional plans of districts so as make it easy for the builders to claim the picturesque valley,” said Rifat Mumtaz of Pune non-profit, National Centre for Advocacy Studies.

Planning norms bypassed

The regulation contained certain conditions that did not suit LCL. It did not allow cutting of mountains; set a ceiling of 2,000 ha for developing a hill city; did not permit construction on gradients steeper than 1:5 (every five metre distance equals one metre height) and FSI of residential plots was limited to 30 per cent with a height restriction of two storeys. These were changed at LCL’s behest. What are a few inconsequential rules when project promoters have powerful friends. Once more, as in the case of Adarsh, rules were changed again and again and again, to make the illegal legal.

On May 30, 2001, the Maharashtra government removed the upper limit of 2,000 ha in the hill station policy, allowing Lavasa to take as much land as it wished. The next day, the state urban development department changed the regional master plan of Pune to allow the hill station to be developed in the Sahyadris (Pune was one of the first districts to change its regional master plan following the change in hill station policy). The day after, on June 1, the Maharashtra government issued orders that 18 villages in Mulshi and Velhe talukas of Pune would be declared hill station. Within three weeks, LCL, which was then called Lake City Corporation, was granted in-principle permission to develop the hill city. In the original regional plan, the area was earmarked for afforestation.

Lavasa’s political patrons

The speed shown by the government to change its hill station policy and master plan could be because the Lake City Corporation has strong political backing. The company had influential board members—Supriya Sule, daughter of Union agriculture minister and NCP leader Sharad Pawar, her husband Sadanand Sule and their close business associate Aniruddha Deshpande. The Sule couple owned 21.97 per cent share in the company which was rechristened Lavasa Corporation in 2004 (see ‘Who owns how much’). The Sules sold their shares in 2004 and withdrew from LCL, but the company did not lose political patronage. Vitthal Maniyar, who serves in the trusts run by the Pawar family, continues to be one of LCL‘s board of directors.

Lavasa's promoters Ajit Gulabchand Chairperson of Hindustan Construction Company (HCC) Heads one of the biggest construction companies of Asia. Took over The Lake City Corporation in 2004, and renamed it Lavasa Corporation Limited. HCC has built the Bandra-Worli sealink, the nuclear power stations in Tamil Nadu and Rajasthan Supriya Sule Entrepreneur and Rajya Sabha MP Daughter of Union Agriculture Minister Sharad Pawar, Sule had a stake in The Lake City Corporation along with husband Sadanand. The couple sold their stake in 2004 Ajit Pawar Deputy Chief Minister of Maharashtra Pawar was the irrigation minister and chairperson of Maharashtra Krishna Valley Development Corporation which transferred 141.15 ha to Lake City Corporation in 2001. He is nephew of Sharad Pawar Madhu Purnima Kishwar Activist, writer Kishwar is founder editor of Manushi, a journal on women's rights. She has been writing articles supporting Lavasa in Indian and international publications Tavleen Singh Senior journalist and columnist Singh has criticised Jairam Ramesh in her columns not only for stopping work at Lavasa but also for his stance on Vedanta and Navi Mumbai airport The opponents Medha Patkar Activist and member of National Alliance of People's Movements (NAPM) Has filed a public interest petition in the Bombay high court against Lavasa along with other members of NAPM, including Anna Hazare, Sunithi S R, Vishwambhar Choudhari Jairam Ramesh Union Minister of Environment and Forests He stopped construction at Lavasa through a stop-work order in November 2010. Lavasa has hauled him and two ministry officials to court for issuing the stop-work notice

In an interview given to Mumbaibased national newspaper, DNA, in December 2010, Deshpande said Lavasa is a “vision of Sharad Pawar”.

The state water resources department, too, spared no efforts to help LCL. The Maharashtra Krishna Valley Development Corporation (MKVDC) leased 141.15 ha to Lavasa in August 2002, which included part of Warasgaon dam reservoir. “The government simply handed over a 20 km stretch of the river that was acquired for a public purpose to a private company,” says B G Ahuja, a former civil engineer with Central government, living in Pune. The order for issuing the lease, as documents with Down To Earth show, was passed by Ajit Pawar, who was then the state’s minister for water resources. He happens to be Sharad Pawar’s nephew. The lease between MKDVC and Lavasa was executed at rates far below the market rate. This transfer was illegal as the mandatory permission from the revenue department was not taken, says R Ramesh, former state revenue secretary.

On Lavasa’s request, the state urban development department amended the hill station policy again on June 7, 2007. The original regulation said the development “shall in no case” involve hill cutting. The clause was changed to: the development “as far as possible should not” involve cutting the mountains. The amendment triggered haphazard cutting of hills. The amendment also made it possible to construct on steeper slopes with gradient of 1:3; the earlier policy allowed construction only on slopes with gradient of 1:5. The building norms were also relaxed to permit three storey structures in 25 per cent of the residential area.

Lavasa wanted more concessions. The chief planner of Lavasa wrote to the urban development department seeking building law relaxations that would allow six-storey buildings and a town centre with mixed activities right on the reservoir’s bank. The government acceded to this request (see ‘Clearances fast-tracked’). On July 14, Sharad Pawar, along with then Maharashtra chief minister Vilasrao Deshmukh and Ajit Pawar, visited Lavasa, accompanied by senior officials. They met Lavasa officials at Ekaant, a resort in the town’s periphery. The minutes of this meeting, accessed by DTE shows, Ajit Gulabchand, chairperson of Hindustan Construction Company which owns 65 per cent of LCL, made a number of demands. These included reducing the no-development zone along the reservoir from 100 metre to 30 metre; designating LCL its own planning authority; allowing increase of height of buildings; permitting a mix of commercial and residential land use in the town centre and permitting a global (floating) FSI. Gulabchand gave a timeframe of four weeks to take necessary actions. The chief minister directed the officials to act expeditiously.

These demands were met the next year. In June 2008, LCL was made a special planning authority with powers to plan and approve development in the area under its jurisdiction. A month earlier, the urban development department gave permission to use global FSI separately for residential, commercial and other sectors and reduced the no-development zone from 100m to 50m distance from the water body.

All members of the special planning authority were from Lavasa, except one—Pune’s director of town planning. “The special authority hardly kept the government in the loop about the plans it approved. The layout plan was modified several times and FSI of the total project area was pooled to build highrises at one place. All this was not permissible,” says an official of the Directorate of Town Planning. He adds that global FSI was not used judiciously.

This was brought to the notice of the Director Town Planning by an assistant director through a letter in July 2009. The letter says the company was seeking undue relaxations which could alter the basic nature of the Hill Station Regulations. The letter states that the regulations are not for just one hill station but for all hill stations in the entire state, and bending rules for one hill station could set a wrong precedent. The note was ignored.

The cover-up

The Maharashtra Pollution Control Board (MPCB) gave Lavasa “consent to establish” in May 2002, much before the project received environmental clearance. In normal circumstances, the consent is given after a project obtains environmental clearance. A letter by member secretary of MPCB, to the Union environment ministry, dated July 15, 2005, says the work on the project was started in January 2003 with intimation to the collector; the project received environmental clearance only in 2004.

In the same letter, the pollution board attempts to gloss over the illegalities at Lavasa which did not apply to the ministry for environmental clearance. The letter says, “since the project is located below elevation of 1,000 metre, EIA notification of 1994 was not applicable to the project and since work commenced in 2003, EIA notification of 2004 was not applicable.” The letter also assures that the developer was “scrupulously following the environmental management plan and carrying out environmental monitoring as recommended by NEERI in its EIA. The pollution board also issued consent for stone crushing of 1,500 tonnes a day in April 2004. This has resulted in large scale stone quarrying in the eco-sensitive Western Ghats.

A 2009 interim report by the People’s Commission of Inquiry, a commission of lawyers and activists set up by non-profits to probe land deals and displacement of people because of projects in the Sahyadris, says various government departments granted a total of 31 clearances in a short period between 2002-2003.

“The bureaucracy moves at a snail’s pace in India. But the way government fast-tracked Lavasa was amazing,” says Rifat Mumtaz of National Centre for Advocacy Studies.

Dubious land acquisitions

Lavasa has also been accused of acquiring land illegally for the project. If activists of the National Alliance of People's Movements (NAPM) are to be believed, 372 ha with LCL was acquired by the state under Maharashtra Agriculture Land (Ceiling and Holding) Act of 1961. Under the Act, land in excess of the ceiling limit is acquired from landowners and distributed to the landless. The government transferred this land to Lavasa, not the poor, activists say. “This land was identified in 1973, but was never acquired by the government till LCL set up this project,” says Sunithi S R of NAPM.

The reason proffered for the land transfer can be found in a letter sent by the collector of Pune to the revenue department in Mumbai. The letter dated January 9, 2005, says the government would earn only Rs 1,02,736 if the land was given to the poor, instead of Rs 1.65 crore if the it is given to LCL. “The comment shows the apathy of officials towards poor in a welfare state,” says Sunithi.

Maharashtra’s revenue secretary declined to speak on the land transfer, saying the Legislative Assembly was in session. But former revenue secretary R Ramesh Kumar says if at all the land was to be transferred to LCL, the company should have paid 75 per cent cost of land to the government as nazrana. Instead, they paid only 2 per cent of the land cost as tax. Ramesh said about 90 ha purchased from tribal families in the area was illegal as no permission was taken. As secretary, Kumar says, he had pointed out these discrepancies but the government ignored them. The revenue department exempted LCL from paying stamp duty on all land transactions.

The people’s commission’s initial findings in Mugaon village says 65 families have lost nearly 135 ha to Lavasa without getting proper compensation. There are complaints of fraud, too. Bandya Bhau Wahelkar, 65-year-old resident of Mugaon, says the 6 ha he was allocated under the land ceiling Act was sold twice without his knowledge. The land records of Mugaon state it was sold to a couple Sharada and Suresh Shetty, who later sold it to a person named M R Diwakar. Walhekar says he did not meet any of these three persons. “When I tried to block access to my land with boulders to prevent mining, company workers threatened me twice with a pistol,” he adds.

Another resident of the village, Leelabai says 20.23 ha land that her family had tilled for 40 years was transferred without their knowledge. “About three years ago, Lavasa wanted permission to build a road through our land. We refused but they went ahead with the construction,” says Leelabai. “When we went to check the land records at the tehsil office, we could not find our names in the records.”

The people’s commission report says “land was grabbed by creating proxy relatives of the villagers, presenting false witnesses and forging land records in collusion with the district administration.”

There may be more land acquisitions in the offing, but the extent of the city’s spread is still uncertain. Lavasa’s red herring prospectus, filed in preparation for its initial public offer, says that Maharashtra has declared 18 villages in Mulshi and Velhe talukas in Pune, measuring about 9,313 ha, as hill station. LCL has so far purchased 3,830 ha, but has applied to the Union environment ministry to give clearance for 5,000 ha. LCL has applied for environmental clearance for 7,000 ha from the Maharashtra state EIA authority.

Lavasa may not be the only hill station in the offing in Maharashtra. In Pune district itself, three companies— Satind Infrastructure Private Ltd, Aqualand India Private Ltd and Maharashtra Valley View Private Limited—are planning to build hill stations in the Sahyadris. Any developer with 400 hectares of land can go ahead and build his dream town. But the fragile ecology of the Western Ghats may take a beating. There are lessons that need to be learnt from Lavasa, else more townships will emerge in the hills by bending laws and breaking regulations.

Will the MoEF set another example like it did with Adarsh society or will the Western Ghats become second or third or fourth home for the affluent.