In India, Slum Dwellers Move Into High Rises

The catch: Developers also get to build luxury housing

One of Omkar’s luxury high rises, under constructionPhotograph by Dhiraj Singh/Bloomberg

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By Bhuma Shrivastava and Sheridan Prasso

August 28, 2014 at 9:03 PM UTC

This article is for subscribers only.

This article is part of the September 1, 2014 issue of businessweek.

Indian developer Babulal Varma’s job requires the human touch. The company he co-founded, Omkar Realtors & Developers, specializes in coaxing Mumbai’s slum dwellers from their hovels, then bulldozing the slum and erecting a mix of luxury condominium towers and free new homes for the slum dwellers on the cleared land. Omkar has completed 12 projects, rehousing 40,000, with 12 more in the works, making it the most successful business in this niche. Mumbai’s slums still house 6.5 million people.

In one slum several years ago, an old woman wouldn’t leave her home. Omkar was keen to develop the site into a $1 billion complex of six luxury high rises and modern housing nearby for the slum dwellers. As Varma recounts it, he visited her and learned that the woman wanted two free apartments, not one. The woman lived with her two sons and their wives in a 90-square-foot shack. The wives argued constantly. Yet the law regulating slum redevelopment says a family that proves residency since 2000 can get only one new, 269-square-foot home on the same land.