TDR faces roadblock due to lack of mechanisms for marketability

C Shivakumar

Chennai:

Transferrable development rights is a new phenomenon which will help the project affected to encash the value of land but it lacks mechanisms for TDR marketability, according to Institute of Town Planners India.



“Transferrable development rights (TDRs) will end in failure if there are no mechanism to help the project affected people to get the value of TDRs from financial institutions,” say ITPI sources.



“These project affected people are basically common people who don’t have any idea on whom to approach to sell their TDRs. In such case, the whole concept will end in failure and the common man will suffer until a mechanism is evolved to create marketability of TDR as has been done in United States,” the sources said.



The state government should have forseen the marketability of TDR before implementing it. The marketability should be classified as mortgaging of TDRs or using it to take loan from financial institution. Otherwise, bank should be involved in financial transaction with the owner of TDR who can use it as a bond. “There should be a mechanism where TDR owner should not seek a potential buyer but instead go to the bank and to encash it,” said ITPI sources.



Similarly, if a builder wants to get TDR certificate he can approach the bank to get higher FSI privileges. ITPI sources said that TDRs failed in India because of conservative law focusing only on road widening to help government in land acquisition but in West it was implemented for zoning regulation.