Though India has a monumental population, its rate of urbanisation has been relatively low. This is a matter of some concern, considering that India has three of the 20 biggest cities in the world i.e. Mumbai, Kolkata and Delhi. It also has 23 cities that house above one million citizens each.
Going by established and ongoing patterns, it can be safely said that true urbanisation has been limited to India's western and southern parts. Moreover, the process of urbanisation in these parts limits itself to certain cities. While this is itself a serious situation, the bigger problem is the gross imbalance between rural and urban development. It has been becoming increasingly evident that agricultural growth is no longer an answer for our rural economy, since India's average yield
per hectare is pathetically low as compared to countries like China.
Not surprisingly, there has been a steady exodus from India's rural parts to its urban areas. This has proved to be a huge strain on their infrastructure. We witness this to greatest effect in a city like Mumbai. Similarly, metros across India are buckling under a steady inward migration from the rural areas - and their infrastructures are not equipped to take the onslaught.
This is proving to be a major problem - one that is directly related to sustainable real estate development in our cities. Rapid urbanisation is fast compromising the urban real estate marketplace, and there are now real concerns about what the scenario will be a few years down the line. We now realise that urbanisation must go hand in hand with environmental sustainability measures.
To illustrate: In India, as in many other countries, the growth in municipal waste is proportionate to its economic growth rate. This amounts to approximately 40 per cent over the past three decades.
Further, by the year 2020, India's demand for commercial energy will very probably increase by a factor of 2.5. An energy deficient country, India is already unable to meet its energy demands and rapid urbanisation is not helping. We see the results everywhere in the form of power shortages and supply interruptions. This growing gap between the demand and supply of energy is a clear SOS for stable, more environment-friendly alternatives of energy conservation such as solar power.
Currently, the sector is divided into players that take the importance of sustainability seriously, and those who do not. The second group, which is in a majority, has issues with overall profitability, since rendering land and buildings sustainable costs money. However, the macro-level issues have more to do with 'change resistance'. The laws of change resistance underline the difficulty in persuading people, corporations and nations to adopt proper sustainability practices.
A sustainability focus in the process of urbanisation calls for a change in individual values at the personal, corporate and collective levels. The problem is not with ignorance - most people are aware about the need for environmental sustainability, and even agree with it. The problem lies in the enactment of these values.
At its very root, sustainability is a process or state maintainable at a given level for prolonged periods. In the real estate context, it means developing land and buildings in such a manner that the environment can sustain future growth.
While talking of a sustained and sustainable real estate boom in India, one should remember that that there is no market without a marketplace. Therefore, for companies that deal in real estate in any capacity, environmental sustainability is not a concept too distant from business sustainability. In other words, there is no difference between sustaining the environment and maintaining the marketplace for indefinite business activity.
With some exceptions, urbanisation has caused residential conditions in most of India's larger cities to decline rapidly. There is a general shortage of infrastructure, increased air, water and noise pollution and a rash of illegal and unorganised structures cropping up.
Given this depressing scenario, it has now been established that townships are the most suitable residential solution. If planned and executed properly, townships are definitely the answer to the growing housing woes brought on by rapid and lopsided urbanisation. They are efficient vehicles of social integration while offering the necessary infrastructure.

Draft housing policy
The unregulated growth brought on by rapid urbanisation is also the result of the activities of unregulated developers. We see a ray of hope in the upcoming housing policy, which is now in the offing. The existing rules and regulations guiding the activities of developers will come under a single umbrella. Of course, a policy is not an Act. It is a kind of guideline under which amendments to several acts will take place. Once this draft has been approved by the Cabinet, these amendments will come in force.
While the housing policy is doubtlessly raw and functional, it is headed in some correct directions. The policy actually encourages the entry of large-scale developers and discourages unregulated developers of small stand-alone projects. In today's context, developers capable of developing large townships are corporatised. They have authenticity, credibility and a focus on future market sustainability.

Scrapping of ULCRA
The Central government had not considered states like Maharashtra and Andhra Pradesh when it repealed the ULCRA (Urban Land Ceiling and Regulation Act) in other states like Gujarat, Karnataka and Punjab. It had its reasons, but it became evident that the ULCRA rendered valuable land useless for all practical purposes. In India, land constitutes approximately 50 per cent of the price of real estate.
Now that the Urban Land Ceiling Act is repealed in Maharashtra, considerable portions of land will be released in central areas of cities. However, these are out of the reach of middle-income buyers to begin with, so they will not benefit. The land locked under the ULCRA and now being reverted to its owners has appreciated in tandem with market dynamics since the passing of the Act 22 years ago. In any case, it will meet no more than 5 per cent of the overall demand in Mumbai over the next one year.
Nevertheless, now that the Act is scrapped, projects will come out at a faster pace, and developers will pass the benefits of speedier approvals on to the consumers.
In any case, repealing the Urban Land Ceiling Act was definitely the need of the hour. While it was certainly envisaged as a means of protection to landowners, it has not served any of the purposes for which it was created. By repealing this archaic Act in all states, the government has assured that the real estate sector will grow by at least 14 per cent by the year 2011-2012. Real estate's contribution to the national GDP so far has been about 11 per cent. With the scrapping of ULCRA, this figure will increase substantially.
This is an excellent and much-awaited move by the government, and definitely a step in the right direction.
Altogether, 25,000 acres of land have now been freed in the financial capital of Mumbai. However, only 10,000 of these are in developable zones, while the remaining 15,000 fall in areas with restrictions, such as coastal zones, forestlands etc. The players with the biggest land holdings previously locked by the ULCRA within Mumbai include Godrej, the Wadia Trust and the Indian Railways, with Hiranandani from the developer community.