Cash-strapped Mumbai developers frown as netas ask for funds

As the civic polls near, developers in the city are breaking into a sweat with candidates from all political parties pressuring them to raise funds even as the real estate sector is facing a lull.

It is an open secret that developers are the main source of funding for any election campaign.  If the corporator gets elected, he helps the developer get government land at throwaway prices and even vacate encroached premises for redevelopment schemes.

“But, presently, the real estate market is at an all-time low.

Developers are reeling under the pressure of high interest rate, increased construction and labour costs. Many have lowered their prices to dispose of inventory,” said a developer, on condition of anonymity. 

But, the BMC elections are turning out to be a big headache for developers.

“Earlier, there were limited political outfits. Now, they are several, besides independents. Each aspirant demands a minimum of Rs1 crore fund and if he is a sitting corporator, the amount goes up to Rs2 crore,” said a prominent city developer, also requesting anonymity.

Social activist YP Singh said that builders fund politicians round the year. “Many politicians have 15% to 20% stake in construction firms that take over the expenditure during polls,” he said. “The difference is that the amount is increased during elections. The candidate in fray pays between Rs5,000 and Rs50,000 per vote.”

Singh claimed that this politician-developer-bureaucrat nexus leads to unauthorised constructions in the city.

But, Paras Gundecha, president of the Maharashtra Chamber of Housing Industry, claimed that the umbrella body has never officially funded any political outfit or individual candidate.

“Whatever help has been meted out is totally in the personal capacity of that particular builder. Politicians do not pressure us to raise funds,” he said.

Niranjan Hiranandani, managing director of the Hiranandani Group, told DNA that he does not fund any political outfits during polls. “But, I do extend help in an individual capacity, and that too depending on my relations with the candidate.”