Indian Slum Becomes Hot Property

Fellows Spring 2012

By Christopher Werth

June 05, 2012

Also aired on Marketplace

Every year, 65 million more people--basically, the population of France--cram into the world's cities. Most of that growth is in developing countries, where people are more than willing to trade life in a poor village for life in a poor city slum. The pay-off, of course, is the prospect of a job.

Mumbai is a sprawling metropolis with a population of nearly 19 million. And at its heart is this crowded maze of self-built shacks and workshops known as Dharavi. With around a million people packed into less than one square mile, it's one of the largest, most densely populated slums in all of Asia. And Niyaaz Ahmed is like many of those who move here from small villages in other parts of India.

Leather worker Niyaaz Ahmed earns around $2 a day in Dharavi.Photo: Christopher Werth

Niyaaz Ahmed: "I came here to find work. I was in school for a while. But when I was 20, I decided to come to the city to make money."

Now, Ahmed earns about $2 a day in Dharavi's thriving leather industry. Crammed into this tiny room at the end of dark, narrow alley, he's among a half dozen men churning out hundreds of wallets he says are destined for the U.S. and Europe.

Ahmed: "I don't know how much they're sold for, but I imagine it's a lot. We start at 9 o'clock in the morning, and we finish at nine at night."

At the end of the day, the men push their tools aside and sleep on the hard, workshop floor. Half of Mumbai lives in slums like this. But Dharavi is rare in that it's a hive of economic activity, from a bustling pottery trade to a growing number of tour operators.

Ganesh Tikonkar: "So, I'll be the tour guide."

For about $10 a head, Ganesh Tikonkar leads a group of six American, Canadian and British sightseers through Dharavi's noisy recycling district.

Ganesh Tikonkar leads tours through Dharavi, one of Asia's largest, most densely populated slums. Photo: Christopher Werth

Tikonkar: "Recycling of plastics, aluminum, cardboard, paint cans."

He says visitors have swarmed through since Dharavi was portrayed in the movie "Slumdog Millionaire."

But Tikonkar says the tours try to dispel certain myths about what life is like in the slum.

Tikonkar: "People always think, 'Oh, there are thieves. There might be guns. There are killings and everything.' But we want to show how hard the people are working."

It's an economic success story that Lakshmi Iyer of the Harvard Business School has studied closely. She says the slum could be home to anywhere from 5- to possibly 10,000 small, informal businesses.

Lakshmi Iyer: "The estimates are that Dharavi produces goods worth about $600 million annually."

But many of its industries are also big polluters. And with little in the way of clean water and sanitation, living conditions in the slum are imperfect, to say the least. That's partly why the city plans to redevelop Dharavi with new, high-rises. New apartments are to be doled out free to some of the residents already here, the others sold off to India's rising upper and middle classes. After all, Iyer says, Mumbai has some of the most expensive real estate in the world. And Dharavi sits on a prime piece of government-owned property.

Iyer: "This land is very valuable. The question is if you build a 15-story building of very nice apartments, what should be done with these informal businesses?"

She says redevelopment could help those businesses grow. But many business owners fear they'll be forced to leave, upending a local economy that thousands of families depend on.

Christopher Werth reported from India with a grant from the International Reporting Project (IRP) in Washington D.C.