Land value capture along Rapid Transit Corridor : case Noida and Greater Noida

Abstract

Provision of Transportation infrastructure in an area induces a great impact on surrounding land and property values. It improves the accessibility of surrounding properties, which get further reflected in property values as per classical economic geography theories (Von Thune 1826; Weber 1929; Alonso 196).Land value capture is an effective financing mechanism to generate revenue through capturing the increment amount in land values resulted from the investment made in public transportation improvement by government bodies/local bodies. Various VCF( Value capture finance) tools are used to capture the increment which is further used to fund public projects. The study aims to follow Area-based approach for Land value capture. It focuses to analyse the change in land and property values before and after the initiation of infrastructure development project, to examine the adequacy of development authorities to capture that uplifted value and use as a source of revenue generation. It is the exploration into what other methods can be adopted to best capture the land value. The case areas selected for the study are NOIDA and Greater NOIDA, the industrial townships set up under U.P Industrial Area Development Act,1976. The phase development of metro has been observed in these areas. The current practices of land value capture mechanism adopted by NOIDA and Gr.NOIDA development authorities are reviewed, thus help to establish the gap between price increased and value captured. The study aims to investigate the effectiveness and quantifying the existing land value capture mechanism. The NOIDA Development authority bears the maximum burden of cost of construction of metro stated as 74.87%, provided as per detailed project report of Metro extension from NOIDA City Centre to sector 62 NOIDA and NOIDA-Gr.NOIDA metro rail corridor. It is thus necessary to find the alternative sources of revenue generation to recover the investment made by authority, also to support the added infrastructure investment due to Metro. The ownership of the land resides with development authorities. DMRC(Delhi Metro Rail cooperation) and NMRC( Noida Metro Rail cooperation) has provided only “User rights”. The study focuses to review the revenue generation mechanism of NOIDA and Gr.NOIDA to come up with applicability of different VCF tools as per needs of the Land Value Capture along Rapid Transit Corridor: NOIDA and Greater NOIDA area abiding by existing rules and regulations. The possible changes will be identified in legislation to suggest more effective mechanism of LVC for NOIDA-Greater NOIDA rail corridor (aqua line) based on the early phases of development (blue line) within jurisdiction limit of NOIDA and Gr.NOIDA