A framework for financing metro rail infrastructure through land value capture mechanisms: Case of Jaipur

摘要: The success of the Delhi Metro Rail in India inspired many of its cities to propose metro rail as Mass Rapid Transport (MRT) transport solution to overcome the issue of urban transport. More than ten cities including Mumbai, Kolkata, Jaipur, Bangalore, Ahmedabad etc. have proposed metro rail and are currently at various stages of implementation. Investment required for MRT projects is in the range of USD 1500 million to USD 5000 million depending on the city size. It is quite obvious that Indian Urban Local Bodies (ULBs) would be hardly able to generate resources to finance such a large capital investment. Even after the assistance from Federal and State governments and loans from donor agencies, the balance fund is difficult to be raised by the ULBs. In such a context, ULB need to innovate urban planning tools and mechanisms to generate the funds required. This study explores how Additional Development Rights (ADRs), can be used as a mechanism for value capture in case of Jaipur city, where a metro rail has been proposed at a total cost of USD 1650 million. Our study clearly highlights that within the defined influence zone of the metro rail, the sale of ADRs can finance a substantial component of the MRT capital cost, in this case about 60%. Study also shows how this framework of ADRs is mainstreamed into the Development Plan and Development Control Regulations for ensuring compliance. Thus the paper will discuss the guidelines for land development mechanisms along the metro corridor to capture the price escalation in real estate through ADRs in case of Jaipur City, the capital of state of Rajasthan.