Curb corruption in real estate

G Krishna Kumar, JUL 30 2021, 00:52 ISTUPDATED: JUL 30 2021, 01:57 IST
There are gross violations of building byelaws with apartments constructed on residential sites
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Reports indicate that 30-50% of the sale value in secondary (Tier2/Tier3 developers) or resale properties happen in cash.
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Contrary to popular belief, even after fifty-six months since demonetisation, real estate continues to thrive on black money. The only exception appears to be the relatively expensive primary real estate market led by Tier-1 builders.

Reports indicate that 30-50% of the sale value in secondary (Tier2/Tier3 developers) or resale properties happen in cash. A reason often cited is savings on stamp duty by quoting transaction value to be close to the guidance value instead of the market value. What prevents the government from keeping the guidance value at the market price?

Cash and corruption

Of late, apartments constructed by Tier 2/3 builders in residential sites are becoming common in Bengaluru and provide an easy opportunity for cash transactions. While almost all construction suppliers accept digital transactions from builders, it is a mystery as to why the builders still insist on cash from the apartment buyers.
There are gross violations of building byelaws with apartments constructed on residential sites. While BBMP’s building byelaws clearly states that a maximum 3 floors excluding parking can be constructed, the builders openly flout rules and construct 5 or 6 floors.

Although BBMP allows a maximum of three kitchens in a residential site . most apartments will have 10 or 12. Over the past 10-15 years a very “corporate“ term called “joint venture” or JV has gained popularity. A case where the site owner and the builder share the constructed apartments. Both the parties try to maximise their gains and is the main reason for spurt in high rise buildings within residential localities.

What about the quality of construction of these apartments? Who is accountable if such buildings collapse?

The authorities appear to turn a blind eye towards the overall issue. In general, all it takes is just one apartment with 10 houses to set the precedence for others to follow suit. Sample this: A regular residential house would have about 5-10 people, while a high rise apartment in the same site would house 40-50 people. Are our roads and civic infrastructure designed to take on such a load? 

The nice neighbours in residential areas with our typical “namage yaake beku” (why bother) attitude helps the builder-authorities nexus. Neighbours often do not complain, fearing repercussion as our system does not offer any protection to them. Also, why should anyone complain? The violations are so obvious to the authorities. It would boil down to the government and civic authorities’ willingness to act. The nexus between the legislators and civic authorities are too obvious to ignore. How do we get over the ‘wolf guarding the sheep’ phenomena? 

Can the state government audit and publish details about illegally constructed apartments in residential localities? How do Banks provide loans for illegal constructions? Can utility providers like BESCOM and BWSSB refuse connections to these complexes?

The whole purpose of residential locality is to allow people to stay in independent houses. Unlike other cities where apartment and flats are popular, Bengaluru is still known for its residential localities. It is rather sad to see this identity go away.

Clearly GST, RERA and other measures have failed to curb black money and corruption in the real estate sector. It is time the government, civic authorities, and urban planners bring about structural changes that will lead to transparency.
If rules need to be relaxed, so be it, but the system must discourage and penalise wrong doers, at the same time support effective grievance redressal mechanism. Government should empower local residents/neighbourhood associations to stop construction of any building that exceed FAR (Floor Area Ratio) threshold.

For transactions in the secondary market, can the stamp duty be reduced significantly if the transaction is at market value? This could encourage buyers to go for 100% legal transaction.

Until we see some strong system-led actions, the tax paying middle-class will continue to be in a dilemma if they need to compromise on their aspirations or on their principles. In this digital age, isn’t it intriguing that the government remains silent despite the rampant corruption in real estate? It is time the vicious link between black money/corruption and the real estate sector is broken. Can Karnataka’s new chief minister address this on priority and show the way to the rest of the country?

(The writer is an ICT Professional and columnist based in Bengaluru)

Mishandling of Covid 2.0

 G Krishna Kumar  | Updated on July 06, 2021

The govt, healthcare sector and citizens, too, are to blame

The second wave of Covid has stressed and stretched India’s healthcare infrastructure to the limits. It was heart-wrenching to see people losing their loved ones during the wave. It is  time to reflect. There are learnings for the government, the healthcare sector as well as the citizens.

The government and the bureaucracy’s mantra for handling Covid should be “only the paranoid survive”. Our government called victory against Covid-19 much too early. On the vaccine front, there was laxity in procurement and government had do get into firefighting mode.

The opposition parties, by vilifying the vaccine policy, ended up creating vaccine hesitancy, which only added to the chaos. Better planning could have helped reduce the misery to a large extent.

The government would do well to form an empowered group of experts for regular advice and strategy. This group could comprise experts from institutes of national importance and research bodies and industry leaders.

Digital divide?

Developing an application for scheduling 200 crore vaccinations is not an easy task. While the government is responsible for the below par user experience with the CoWIN app, the current version of the app is much better than the March 2021 one. Proactive planning and extensive testing would have helped in creating a better solution for public use.

As CoWIN is available in many local languages, why is there still talk about digital divide? There are 75 crore internet users in the country. The digital literacy has improved significantly over the past few decades, unfortunately it is limited to digital entertainment.

The government should be held accountable for not having brought in more innovative solutions in not envisaging the challenges being faced by the people in remote parts of the country.

One other most important reason for the spread of the virus has been our callous attitude. The authorities are seen pulling up people for not wearing masks or stepping out during lockdowns. This shows either our don’t care/chalta hai attitude or sheer disrespect for rules.

A country well-known for discipline is Japan, where the people are known to follow rules and care for fellow citizens. The Japanese have a long history of wearing masks. Over the past 50-60 years, masks have been commonly used by people when they have common cold /flu, etc. This prevents others from catching infection.

In India, rather than blaming the government for the spread second wave, people on their part will need to be more careful and sensitive to the well-being of fellow citizens.

Doctors and hospitals

Indians are known to glorify doctors when they save lives and, at the same time, blame them for the death of loved ones.

Doctors serving Covid patients admit that they are learning every day, as each patient responds differently. Considering the unknowns in the treatment of Covid, increased transparency on a patient’s condition would help reduce any possible friction that may arise with the patient’s family members. While medical negligence must be strictly dealt with, it must be acknowledged that most doctors are doing their best in the given circumstances.

For handling the surge in patients, allowing students pursuing medicine and nursing to assist will prove handy and, at the same time, it will provide excellent hands-on experience for them. The government could consider allowing ayurveda and homeopathy doctors and students, too, to handle the patient load. This can potentially offer a large buffer pool of healthcare staff during crisis times.

Some questions that beg answers from the healthcare professionals are: Why didn’t they not alert the government strongly enough about the risk of a second wave? Also, why didn’t the private hospitals not prepare proactively if they knew the second wave was certain?

As the second wave of Covid recedes, it’s time for the government, the healthcare sector and citizens to pause and reflect. While a large part of the learnings from the mishandling of the second wave must be for the government, it is equally important for the people and the healthcare system not to repeat the mistakes committed.

The writer is a Bengaluru-based columnist. Views are personal