Can Dharavi revive the bond market ?

Less than a week after global tenders were floated for the over Rs. 9,000 crore ($2.25 b) Dharavi Redevelopment Project (DRP), black flags have come up all over the sprawling settlement which is dubbed Asia's largest slum. The residents and small business owners inside the slum feel the rehab scheme isn’t making good their livelihood that their present abode gives – that it helps only the private builders who get more FSI to build on and profit.

You can’t blame the protesting slum-dwellers. They have not been assured of suitable alternative residence / workplace that would allow them to carry on their livelihood in the DRP. So why wouldn’t they object ?

Fact is that Maharashtra Government is no Michael Milken.

.

But it badly needs him or someone who had acumen like him to devise an instrument like high-yield Junk bonds that could be a brilliant innovation to revitalize the $1 b Dharavi economy. When Junk bonds enable businesses (that are currently denied access to capital) to invest in infrastructure and equipment, they will have fewer reasons to protest. Notably many SME businesses like pottery, jewellery, leather goods that operate from Dharavi.

And all this makes me wonder: Who will be the junk bond king of Dharavi? Perhaps some bond trader from Dalal Street would like a second act as philanthropist and investor?

Could be a worthwhile trade even.