India stops construction on ‘illegal’ hill city

19 January 2011

The Indian Ministry of Environment & Forests (MoEF) has ordered construction work to stop on the Lavasa hill city project after finding that the developer flouted environmental laws.

Indian contractor Hindustan Construction Company (HCC) was developing the 12500 acre (50.6 km2) hilltop Lavasa development near Pune, Maharashtra.

But a team from the MoEF visited the city from 5 to 7 January and reported that it had caused environmental damage.

The MoEF has halted construction work, and called for a "substantial" penalty to be levied against the company in a 17 January order. The MoEF also said HCC should set up a restoration fund to make good the environmental damage at the site.

The ministry said it would like to impose "stringent terms and conditions" to ensure that no further environmental degradation was caused by the construction work.

In addition, the MoEF order stated that the Maharashtra State Government did not have the authority to give the 2001 and 2004 clearances for the project.

But HCC hit back at the order, stating, "The report seems to magnify minor environmental issues to justify continuance of the stop work order."

HCC said its legal counsels were studying the order and would explore all available options.

In January, 2009, HCC signed up to another project to develop a similar new city in India's Gujarat province.

Total investment for the scheme was put at INR 40000 Crore (US$ 8.2 billion), and the company said it would be built on similar lines to the Lavasa development.

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