The public wealth of Indians is locked up in land, PSUs and minerals. Nayi Disha’s estimate is that this comes to $20 trillion, or ₹50 lakh per family.
The public wealth of Indians is locked up in land, PSUs and minerals. Nayi Disha’s estimate is that this comes to $20 trillion, or about ₹50 lakh per family. Under Dhan Vapasi, the government should return ₹1 lakh annually per family.
Public Wealth of India – Land
One of the biggest sources of public wealth in India is the land that is under government control. Let us take an example. Lutyens Delhi – which houses the buildings and bungalows for much of India’s central government – is about 2,200 hectares, 90% of which is controlled by the government. Minister, MPs, bureaucrats and others live in massive homes – many built by the British in the colonial era to house their own officers. We can do some simple arithmetic to understand what the value of Lutyens Delhi today would be – and thus arrive at the opportunity cost of housing our government.
What is 1 hectare worth?
One hectare is about 100,000 square feet. Let us consider an FSI (floor space index) of 10. [As an aside: most Indian cities have artificially constrained the area that can be built. Cities are the generators of wealth. New York, Hong Kong, Shanghai and Singapore allow for FSI of 15-25. It allows cities to go vertical and leave a lot of space for greenery and common areas like parks.]
With an FSI of 10, 1 hectare can offer 1 million square feet of space. In cities like Delhi and Mumbai, we can easily assume a low threshold of ₹10,000 per sq ft. This gets us the value of 1 hectare when it is efficiently used for productive purposes – ₹1,000 crore. Or about ₹40 for each of the 25 crore families in India.
Let us do the math
The 2,000 hectares of Lutyens Delhi under government control but owned by the people of India are worth ₹80,000 for every family in India. Every city in India has its own Lutyens equivalent – prime land occupied by ministers and bureaucrats, past and present.
Let’s take this further. Delhi Cantonment is 4,000 hectares. Mumbai’s Navy Nagar is 200 hectares. The Mumbai Eastern Waterfront is about 800 hectares. Just these 3 areas add another ₹2 lakh to the wealth of every Indian family.
And the list goes on. 65 Indian cities and towns have cantonments. There is simply no logic in keeping defence establishments in the middle of cities of a free India. Most of them were created during British rule to control the local population from rising against their colonial masters. That era has long since passed. No other city in the world has defence forces occupying prime urban land.
Add to this, the land controlled by PSUs, railways, ports, airports – all of them are sitting on massive amounts of surplus land. In fact, the space above train stations in Mumbai, Delhi and other cities is prime area also. Buildings above Hong Kong’s metro stations are among some of the highest valued in the world. In places like Mumbai, we have tried to reclaim the sea – why not reclaim the sky?
Taken together, the conservative value of land under government control which can be monetised exceeds ₹10 lakh per family.
PSUs and Minerals
PSUs can easily add an additional ₹5 lakh, and the mineral wealth another ₹35 lakh. [See the Nayi Disha Public Wealth for details.]
This is land where new factories and offices can be built, new schools, colleges and hospitals can be constructed, and millions of units of affordable housing can be built. Cities are where 40 crore young Indians are going to migrate from the rural areas over the next 25 years. They form part of our demographic dividend. By making them productive, India can usher in a golden era of prosperity – much like what China did starting in the 1980s.
We must remember that it is people who create wealth, not governments. By returning the wealth of the people, we will create in India an economic revolution that will thus eliminate poverty and drive massive job creation. Dhan Vapasi is the way to kickstart this cycle of wealth creation of prosperity.
Tomorrow: Making It Happen