Shocker: Millions Of Jobs At Risk As Supreme Court Bans Construction Activity In Three States 

The Supreme Court has banned all construction activity in Maharashtra, Madhya Pradesh, Uttarakhand and the Union Territory of Chandigarh after they did not formulate a solid waste management plan as per an earlier order, Bloomberg Quint has reported. The ban will be valid till 9 October.

These three states and Chandigarh, where the ban has been imposed, account for about 35 per cent of the national real estate market.

“The attitude of the states/union territories in not yet framing a policy even after two years is pathetic, to say the least,” the court said in its order.

The bench headed by Justice M B Lokur imposed a fine of Rs 3 lakh on all states. Lokru is one of the four judges who, in an unprecedented move earlier this year, held a press conference against the Chief Justice.

The order has left real estate developers worried as it would affect the sector. In their opinion, the ban will not only affect the sector which is seeing signs of recovery but also impacts the lives of daily wage earners and interests of home buyers. Steel and cement sectors may also be affected by the order.

“Homebuyers will suffer just because some state governments have not formally notified the policy. Perhaps, it would have been better if the court would have penalised the state administration and barred new construction while allowing ongoing projects to be completed,” President of the National Real Estate Development Council, Niranjan Hiranandani, has been quoted as saying.

The order comes at a time when projects worth Rs 4.64 lakh crore for a total of 575,900 units are already behind schedule.

As the Apex court’s decision affects multiple sectors which are interlinked, it is likely to put millions of jobs in the country at risk.

“The ban has the effect of bringing an entire industry to a standstill. Nearly a thousand industries are interlinked with construction and real estate. While the ruling will have far-reaching economic and social impact, any cessation of housing supply will lead to an escalation of property prices, hurting the government’s target of Housing for All,” Liases Foras Managing Director Pankaj Kapoor has been quoted as saying.

A similar order delivered by the National Green Tribunal in 2013, which banned construction activity within a 10-km radius of the Okhla Bird Sanctuary in Noida, had devastating results for the area. According to the Hindu Business Line, over Rs 3,000 crore was wiped out from the local economy and property rates in the region soared from Rs 3,000 per sq ft to Rs 6,000 per sq ft.