Mumbai Real Estate Projects Halted by New Environmental Clearance Order
The real estate sector in Mumbai is experiencing significant disruptions due to a recent directive from the National Green Tribunal (NGT). This order has led to the suspension of nearly 200 projects in the Mumbai Metropolitan Region (MMR), causing delays
Mumbai Real EstateEnvironmental ClearanceNgt OrderReal Estate ProjectsEcosensitive ZonesReal EstateJan 02, 2025
The order, issued on August 9, mandates that projects with a built-up area exceeding 20,000 square metres and located within a 5-kilometre radius of eco-sensitive zones must obtain environmental clearances from the central government.
Previously, these approvals were managed by state authorities, but the new ruling has left both developers and government agencies struggling to adapt.
The directive affects numerous high-profile projects near critical ecological zones, such as the Sanjay Gandhi National Park in Borivali, the Flamingo bird sanctuaries in Thane and Navi Mumbai, and the Tungareshwar Wildlife Sanctuary in Vasai-Virar.
These areas are environmentally sensitive, and the ruling aims to protect them from the adverse impact of large-scale construction activities.
While the intention behind the order is commendable, its sudden implementation has resulted in substantial delays for real estate developers.
Many projects, especially those in the planning or early construction phases, are now in limbo due to the lack of clear guidelines on how the new clearance process should be executed.
State agencies have refused to grant approvals, citing the NGT order, while central agencies are still setting up the necessary mechanisms to take over this responsibility.
This has created an administrative vacuum, leaving projects stalled and developers uncertain about how to proceed.
The impact has been particularly pronounced for projects requiring modifications to their original plans or new developments within the 5-kilometre radius of eco-sensitive zones.
Land parcels previously acquired for redevelopment and agreements with societies have also been left hanging.
Developers have expressed frustration that the broad application of the rule does not consider the unique urban challenges of Mumbai, where eco-sensitive zones often adjoin densely populated areas.
The delays have not only caused significant financial strain but have also led to escalating project costs.
With construction timelines stretched indefinitely, many developers fear that the financial viability of their projects may be compromised.
In response, the Confederation of Real Estate Developers’ Associations of India – Maharashtra Chapter (CREDAI-MCHI) has filed a petition with the Supreme Court, seeking a temporary suspension of the NGT order until a central committee is formed to oversee the clearance process.
The court has already held three hearings on the matter, with the next one scheduled for January 21.
The Ministry of Environment, Forests, and Climate Change (MoEFCC) has been directed by the court to address the concerns raised by the petitioners.
Prior to this ruling, the State Environment Impact Assessment Authority (SEIAA) was responsible for granting environmental clearances in Maharashtra.
This system was praised for its efficiency and understanding of regional environmental concerns.
However, the sudden shift to centralised clearance has disrupted the process, leaving a gap in administration that has added to the widespread uncertainty in the industry.
Until a resolution is reached, developers are calling for interim measures that would allow state-level hearings to continue in the absence of a central mechanism.
The fate of the stalled projects remains uncertain, and with Mumbai’s real estate market under strain, stakeholders are grappling with the potential long-term impacts of the NGT’s ruling.
Frequently Asked Questions
What is the new NGT order affecting real estate projects in Mumbai?
The NGT order mandates that projects with a built-up area exceeding 20,000 square metres and located within a 5-kilometre radius of eco-sensitive zones must obtain environmental clearances from the central government.
Which areas are considered environmentally sensitive zones in Mumbai?
Some of the environmentally sensitive zones in Mumbai include the Sanjay Gandhi National Park in Borivali, the Flamingo bird sanctuaries in Thane and Navi Mumbai, and the Tungareshwar Wildlife Sanctuary in Vasai-Virar.
How has the new environmental clearance process affected real estate developers?
The new process has caused substantial delays and financial strain for developers, with many projects in the planning or early construction phases now in limbo due to the lack of clear guidelines and administrative vacuum.
What action has CREDAI-MCHI taken in response to the NGT order?
CREDAI-MCHI has filed a petition with the Supreme Court seeking a temporary suspension of the NGT order until a central committee is formed to oversee the clearance process.
What was the previous system for granting environmental clearances in Maharashtra?
Prior to the NGT order, the State Environment Impact Assessment Authority (SEIAA) was responsible for granting environmental clearances in Maharashtra.
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