When mills were turn into malls and high rise towers, an opportunity was lost. Its a good example of how change is not always for the good, says Vivek Kaul.
In a research paper titled Impact of Mumbai (India) Textile Mill Land Development on Land Use and Real Estate Markets published in 2006 by the Lincoln Institute of land Policy, Piyush Tiwari, Anil Kashyap and Shashwat Tewary estimated that: “There are fifty eight cotton textile mills located in the city of Mumbai, which occupy nearly 0.5% of the Greater Mumbai’s land area of 468 Square Km. Half of these cotton textile mills have been under public ownership and the remaining is under private ownership.”
A lot has changed since 2006 and many of these mills have now been replaced by office space to work in and apartments to live in. The area was once was populated with textile mills. These textile mills essentially remained competitive on the back of cheap labour which landed in Mumbai looking for work.
As Tiwari, Kashyap and Tewary wrote: “The industry was largely labour oriented. The survival of mills during the second half of twentieth century rested on low labour cost. With the imposition of trade quotas on textile exports in international markets, competition from Hong Kong, China and Pakistan in the world market and slow expansion of domestic market wiped away the competitive edge of Mumbai cotton textile mills.”
This led to the decline in profitability of the textile mills of Mumbai. The textile strike led by Datta Samant which started on January 18, 1982, was the final nail in the coffin of the textile mills of Mumbai. After the mills shutdown, suddenly a huge amount of land was empty right in the middle of the city. For close to decade, the textile land remain unused. And then things started to change in the mid-1990s.
As Liza Weinstein of the Department of Sociology of the University of Chicago, writes in a research paper titled Mumbai’s Development Mafias: Globalization, Organized Crime and Land Development: “In the mid-1990s when, after decades of industrial decline, the government began to allow the sale of hundreds of acres of former textile mill lands in the virtual centre of the city.”
This coincided with the economic reforms process which started in 1991. With the economy opening up, smuggling which used to be a major money spinner for the mafia suddenly wasn’t profitable anymore. As Shirish Patel writes in a report titled My Bombay – My Dream released by Bombay First: “There is no denying that after smuggling became irrelevant following the reforms of the early 1990s, that mafia moved partly into films, and partly into real estate.”
And this is how the mafia moved into real estate. Daryl D’Monte recounts this in his book Ripping the fabric: decline of Mumbai and its mills. As he writes: “The loss of industrial jobs was a grim reality; prices of real estate were going through the roof; and the ugly face of the underworld was emerging. All three ingredients of this deadly brew were on the boil when it came to the sale of mill land in the notorious Khatau case.”
D’Monte writes about the Khatau case in detail. Sunil Khatau, who was the chairman of one of the oldest textile mills in Mumbai wanted to sell the plot on which the mill was located. The government approved the sale subject to the labour union agreeing.
Knowing this could be tricky, Khatau approached Arun Gawali. Gawali managed to engineer a coup in the labour union and install a president who was sympathetic to what Khatau was trying to achieve. “With a new union president in power, Gawali helped gather the requisite worker support to approve the sale. For his part, Gawali was allegedly promised 5% of the sale price of the land — estimated to fetch as much as $100 million due to the timing of the sale at the height of Mumbai’s land boom,” writes Weinstein of the University of Chicago.
Weinstein goes on to point out that after the land was approved for sale Khatau stuck a deal with Dawood Ibrahim. As she writes: “Once the land was approved for sale, Dawood reportedly struck a deal with Khatau to purchase the land for $90 million. Before the sale was finalized, however, Sunit Khatau was shot while sitting in the backseat of his car. The assassins managed to escape, while Khatau died on the way to the hospital.”
There is no denying that after smuggling became irrelevant following the reforms of the early 1990s, mafia moved partly into films, and partly into real estate.
Cut to 2015, what started in the mid-1990s is in full swing. If you happen to take a walk around the central Mumbai areas like Worli, Lower Parel, Dadar and Prabhadevi, construction is in full swing everywhere, on land on which textile mills used to once run.
Many luxury apartments and offices have been built on this land from textile mills. What was once Jupiter Mills near Elphinstone station is now Indiabulls Sky. Crown Mills in Prabhadevi is now Orchid Crown. The China Mill compound in Sewri houses the Dosti Flamingoes. The city’s famous Hard Rock Café is where once the Bombay Dyeing Mill used to be.
Having said that many mill compounds continue to remain unused. This includes Madhusudhan Mill and Prakash Mill in Lower Parel, and some of the mills owned by the National Textile Corporation, across the city.
The tragedy is that textile mills used to make something useful. But that isn’t true about what is being built on it. Most of the construction that is happening is essentially catering to the speculation needs of the rich, particularly those who have a lot of black money and don’t know what to do with it.
A FICCI report on black money published in February 2015 points out: “The Real Estate sector in India constitutes for about 11 % of the GDP of Indian Economy, as these transactions involve high transaction value. In the year 2012-13, Real Estate sector has been considered as the highest parking space for black money.”
A recent news-report in The Financial Express pointed out that around 5,000 super-luxury upmarket flats are built and ready to move in but have not been able to find buyers. Most of these flats with a price of Rs 10 crore or more are in Central Mumbai, having been built on land which used to once have textile mills. If that isn’t ironical, I don’t know what possibly is.
A city cannot remain stuck with its past. It needs to evolve. It needs to move on. Nevertheless, the evolution has to be in a positive direction. In Mumbai’s case, what used to be once be the heart of the city, where people worked and lived with their families, has now been turned into an orgy of huge real estate speculation. And that is indeed very sad, especially for a city which has a huge housing shortage.
(Vivek Kaul is the author of the Easy Money trilogy. He tweets @kaul_vivek)
