The Maharashtra cabinet has approved a comprehensive land acquisition and allotment framework to accelerate development of the proposed “Third Mumbai” in the influence zone of the Mumbai Trans Harbour Link (Atal Setu), marking a decisive step in reshaping the Mumbai Metropolitan Region’s growth geography.
The policy establishes the rules under which land will be assembled and allocated for residential districts, industrial clusters, logistics hubs and supporting infrastructure across the emerging corridor connecting Sewri to Nhava Sheva. The notified area will be implemented through a designated New Town Development Authority along with the Mumbai Metropolitan Region Development Authority (MMRDA). At the heart of the framework is a hybrid acquisition model. Land can be secured through negotiated settlements under the Maharashtra Regional and Town Planning Act or via statutory compensation mechanisms. Importantly, the cabinet has enabled compensation in the form of Floor Space Index (FSI) or Transferable Development Rights (TDR), offering landowners development-linked value rather than only cash payouts. A 22.5 per cent land return mechanism has also been approved. Under this structure, eligible project-affected persons will receive a proportion of developed plots. Where the returned area falls below a minimum threshold, monetary compensation will apply. Officials say this approach aims to balance equity concerns with the need for large-scale, contiguous land parcels.
To catalyse industrialisation in relatively underdeveloped pockets, the state has introduced a pass-through policy. Under this arrangement, all land acquisition and infrastructure costs will ultimately be borne by allottees, with MMRDA recovering expenses in instalments along with establishment charges. Land in such zones will be transferred on an as-is-where-is basis, limiting upfront fiscal exposure for the authority. The cabinet has also outlined conditions to attract foreign direct investment, including minimum landholding and capital deployment thresholds within defined timelines. Undeveloped plots cannot be traded, a safeguard intended to curb speculative hoarding and ensure time-bound project execution. Urban planners view the Third Mumbai initiative as a strategic response to saturation pressures in the island city, Thane and Navi Mumbai. With the Atal Setu dramatically reducing travel time across the harbour, the eastern waterfront corridor is being positioned as the next metropolitan growth frontier. However, experts caution that land monetisation must be matched with transit integration, water security planning and climate-resilient infrastructure, given the coastal and estuarine sensitivities of the region. Beyond real estate expansion, the state has directed MMRDA to design a robust revenue model to fund trunk infrastructure sustainably.
The long-term success of Third Mumbai will depend not only on land aggregation but also on inclusive housing supply, employment generation and low-carbon urban design standards. If executed with institutional discipline, the Third Mumbai project could recalibrate the spatial balance of India’s financial capital easing density pressures while creating new industrial and residential nodes anchored to next-generation connectivity.
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