The Impact of Dharavi Redevelopment on Small Businesses and Informal Economy Workers
The Dharavi Redevelopment Plan (DRP), led by Adani Realities, aims to transform Asia’s largest slum. However, the project raises significant concerns about the future of small businesses and the livelihoods of informal economy workers in Dharavi.
DharaviRedevelopmentInformal EconomyAdani RealitiesSlum RehabilitationReal Estate NewsMay 20, 2025
The economic activities in Dharavi are diverse, ranging from garments and apparel to leather goods manufacturing, waste recycling, pottery, and snack making. The area is also home to large warehouses of raw materials and finished products, including mats, leather, pottery, snacks, and unstitched cloth. Additionally, Dharavi comprises significant residential units, both owned and rented.
The latest Dharavi Redevelopment Plan (DRP) is being carried out by Adani Realities, the real estate arm of the Adani Group, in a joint venture with the Maharashtra government. The project follows the Slum Redevelopment Scheme of the city’s Slum Rehabilitation Authority, as outlined in section 33(10) of the Development Control Regulation.
Past and Present Efforts at Dharavi Redevelopment
Rehabilitation initiatives for slums, including Dharavi, have been ongoing since India’s independence. These efforts have been driven by humanitarian concerns and have employed various methods, such as relocation and rehabilitation. However, many of these measures have been repressive, often involving evictions that met with strong resistance.
In the early 1970s, a slum area improvement program was launched to provide basic amenities to Dharavi’s residents. The government’s approach, which involved uprooting slum dwellers with police assistance, led to significant resistance. In 1987, the Maharashtra Housing and Area Development Authority (MHADA) was designated as the Special Planning Authority and developed 27 seven-storied buildings under the Prime Minister’s Grant Project, though the project remains incomplete.
The period of liberalization saw market-driven solutions for welfare, leading to the appointment of a Slum Rehabilitation Authority (SRA) to implement the Slum Rehabilitation Scheme. Since the SRA’s announcement in 1995, 86 schemes have been approved by 2004, though many failed to materialize due to the presence of commercial and industrial units. Most development occurred along existing roads.
In 2004, the government approved the Dharavi Redevelopment Project (DRP), which aimed to rehouse eligible property owners in 300 square feet of space in seven-story tower blocks, complete with standard infrastructure. Developers would receive incentives like additional Floor Area Ratio (FAR) and transfer of development rights (TDRs) to build extra units for sale, offsetting rehousing costs. However, the plan faced resistance due to the lack of community participation.
Inside Dharavi: Realities of Informal Economy Workers and the Question of Rehabilitation
Dharavi is a hub of small-scale manufacturing and industrial units, primarily in garments, plastic recycling, dyeing, aluminum molding, leather processing, and snack making. These activities generate an estimated $1 billion annually and employ tens of thousands of workers, many of whom are migrants from various states. The current DRP plan is silent on the rehabilitation of these workers, who are essential to the local economy.
The proposed relocation of ‘non-eligible’ tenements to areas like the Deonar landfill, salt pan lands in Wadala and Kanjurmarg, and the Kurla Dairy plot is particularly alarming. These areas are unfit for human habitation, and relocating people there would be a blatant violation of human rights. The government’s failure to provide basic dignity and care to Dharavi’s working-class communities reflects a systemic issue.
The Urgency to Develop Dharavi
The urgency to develop Dharavi is driven by the need for more land in the Bandra Kurla Complex (BKC), one of Mumbai’s most expensive real estate areas. BKC, once marshy land, is now home to major corporate entities. However, land in BKC is limited, and more is needed for further development. Dharavi, with its estimated 600 acres, is seen as a solution. Current residents will be given modest properties or relocated to distant areas, making way for new offices and luxury towers.
While the DRP aims to address the needs of Dharavi’s residents, it raises significant concerns about the future of small businesses and the livelihoods of informal economy workers. The project’s impact on the community’s economic fabric and the potential displacement of tens of thousands of workers highlight the need for a more inclusive and participatory approach to redevelopment.
Frequently Asked Questions
What is the Dharavi Redevelopment Plan (DRP)?
The Dharavi Redevelopment Plan (DRP) is a project aimed at transforming Asia’s largest slum, Dharavi, into a modern urban area. It is being carried out by Adani Realities in a joint venture with the Maharashtra government.
What are the main economic activities in Dharavi?
Dharavi is a hub of small-scale manufacturing and industrial units, including garments, plastic recycling, dyeing, aluminum molding, leather processing, and snack making. These activities generate an estimated $1 billion annually and employ tens of thousands of workers.
Why is the DRP controversial?
The DRP is controversial because it lacks a clear plan for the rehabilitation of workers and informal economy participants. Additionally, the proposed relocation of 'non-eligible' tenements to unfit areas like the Deonar landfill raises concerns about human rights and the well-being of Dharavi’s residents.
What is the role of Adani Realities in the DRP?
Adani Realities, the real estate arm of the Adani Group, is leading the Dharavi Redevelopment Plan in a joint venture with the Maharashtra government. The project aims to redevelop Dharavi by providing new housing and infrastructure while freeing up land for commercial use.
What are the potential benefits and drawbacks of the DRP?
The potential benefits of the DRP include modern infrastructure and improved living conditions for Dharavi’s residents. However, the drawbacks include the displacement of small businesses and informal economy workers, the lack of a clear rehabilitation plan, and the proposed relocation to unfit areas.
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