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As wealth rises in India, so do private towns

As more Indians pack into already crowded cities, developers are wooing wealthy urbanites with private towns boasting amenities like gardens, pools, walkable streets, schools, and a golf academy.

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Lavasa officials reject these allegations. The company is buying land at market prices and offering incentives such as alternative land, free housing, and development of village facilities, says Suresh Pendharkar, Lavasa’s chief planner. Much of the land has been bought from investors who previously acquired it from farmers, he says. That is the case with the Margales and Waghlekars, he adds.

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“If there is any substance to the complaints, it is not in the Lavasa deals,” Mr. Pendharkar continues. “Our project is so large, so audacious, we don’t want to get into any questionable practices.”

As for environmental impact, he says, the state government sanctioned the project only after assessing the risk.

Unlike 'anywhere in India' 

Land acquisition is the main hurdle for such large-scale developments. Just two hours from Lavasa, a more modest township solved that challenge in a novel way. In the outskirts of Pune, some 120 farmers pooled 430 acres of land and became shareholders in their own development company.

The initiative “made landowners part of the development process, and gave them a continuous stream of revenue,” says Satish Magar, the company head. It also turned farmers into entrepreneurs – many of them now run township services.

Today, with 5,000 apartments and an IT park, Magarpatta City epitomizes middle-class order. It recycles its waste and generates some of its own power. It hosts a school, a market, and a garden where the national anthem is sung every morning. It has CCTVs and 1,200 security guards.

“It's great for families. You can walk your kid to school or walk to office, and you feel totally safe,” says Ranjit Singh Chauhan, an IT professional who lives and works there. “It's a clean city,” he adds. “You won't feel like that anywhere in India.”

If Mr. Chauhan has any complaint, it is the absence of city life, although Pune’s bright lights are just a bus ride away.

Help from the cities 

In fact, while India's private minitowns offer escape from urban congestion, the successful ones such as Magarpatta are located close to a city because they rely on cities’ larger economy and social services, as well as its pool of servants, plumbers, and other workers.

The townships “depend on a larger infrastructure – education and social and health and transport – that only a large city can provide,” says Mr. Apte, adding that the IT sector doesn't generate enough employment to support a broader economy. He believes the township boom has more to do with real estate ventures than actual city building.

Lavasa is set deep in the hills and only reachable by car. But the aim is to make it a self-sustaining city for all classes, with 300,000 permanent residents and 2 million visitors and tourists, says Anuradha Paraskar, senior vice president oif marketing for Lavasa Corporation Ltd.

The town will eventually generate employment through IT companies and other nonpolluting industries drawn by government incentives, she says. And a range of housing is being constructed, including 50,000 one-room kitchen rental units for drivers and other service workers.

“This is not a resort town, a city for the rich,” she says.

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