MUMBAI -- Vijay Pratap, who makes his living as a door-to-door political campaigner, shares his one-room tenement -- smaller than parking space for two small cars -- with six members of his family, including his octogenarian mother. He has lived there all 61 years of his life, three generations in a 160-square-foot room in a dilapidated 96-year-old three-story building in Mumbai. While the city around his home has transformed into a megalopolis, these BDD chawls -- low cost housing developed by the Bombay Development Department of the British government -- have remained untouched.

Until now.

Three of India's largest conglomerates have begun work to clear huge swathes of the land, projects that, if all goes according to plan, will swell their profits while also providing residents with new homes for free. The BDD projects could become a template for redevelopment of other areas of notoriously bad housing in this city of 20 million people.

Set up a century ago by the British over 90 acres of Central Mumbai, the BDD tenements attracted migrants from all over India, thousands of them working in the textile mills nearby. Today, Mumbai is the financial capital of India, a business center and also the hub of Hindi cinema. It is not a textile hub. The mills never recovered from a crippling strike in the 1980s and in the past 20 years, owners have torn them down and converted them into commercial and luxury residential towers to accommodate the nouveau riche. Without any social security, the workers living in BDD chawls survive by doing odd jobs.

Global financial powerhouses including Blackstone Group, GIC of Singapore, KKR & Co, and Brookfield Asset Management have bet big on real estate projects surrounding them. Local real estate group Macrotech Developers has put up a Trump-branded tower, where apartments go for $1.5 million and higher.

Vijay Pratap shares his one-room tenement with six members of his family. (Photo by Kamlesh Pednekar)

In their shadow, thousands of BDD dwellers feel the economic liberalization initiated 30 years ago by the Indian government has left them behind. "We can see several new towers coming around us with each flat costing millions of rupees. But our life has remained the same as we are caught in the time warp," Pratap said.

Pratap and his family now pin their hopes on the local government plan to redevelop the chawls. Residents could soon be handed the keys to bigger, 500-square-foot apartments in newly constructed buildings. In return, the land vacated by the chawls will be used to erect towers with much bigger apartments that will be sold in the open market.

A similar strategy was earlier proposed for the redevelopment of Dharavi -- Asia's largest slum, located a few miles to the north -- but it has stalled. Another redevelopment project initiated by the Bombay Port Trust, one of Mumbai's largest landowners, is in the planning stage. Redeveloping these areas has been a dream for decades, but volatile real estate prices, red tape and residents' opposition to relocation have been persistent obstacles.

While the Dharavi slums contain small businesses making everything from earthen lamps to leather bags, which cannot be accommodated in new buildings, BDD chawls have no such issues. Another factor in the appetite for starting work: home prices in Worli, site of the largest of the BDD projects, are 15-20% higher than in Dharavi.

Several homes in century-old BDD chawls in Worli are covered by blue plastic sheets to keep out rain. (Photo by Kamlesh Pednekar)

A consortium led by Tata Projects finally broke ground in Worli in August after protracted negotiation with residents and the resolution of litigation among contractors. Some 10,000 families currently reside in 121 chawl buildings across 55 acres in Worli, and the masterplan calls for their replacement with 98 "rehabilitation" and open sale buildings in total, of between 22 and 66 floors.

For Tata Projects -- a tiny part of the Tata family's $103 billion revenue business empire -- the 117 billion rupee ($1.6 billion) contract from the local government will add 15% to 20% to its top line over the eight-year period of construction. It also hopes the project will be copied across the country, adding to a burgeoning portfolio of business which includes infrastructure projects such as metro rail in Chennai, Pune and Mumbai.

Larsen & Toubro, which is redeveloping the 42 chawls in Naigaon, Dadar, is India's largest construction company with sales of 733 billion rupees in the fiscal year ending March 2021. L&T will construct 20 buildings of up to 23 stories for current BDD residents and four, 60-story towers for open sale. It will also construct a commercial building at the same site.

A woman works at a traditional pottery factory in Dharavi. (Photo by Kamlesh Pednekar)

The smallest of the three projects -- 16 buildings in the NM Joshi Road area of Lower Parel -- is being led by Shapoorji Pallonji & Co., which is India's oldest construction company and whose owners, the Mistry family, have been in a long-running legal feud with Tata Sons that only ended this year. A Shapoorji Pallonji official said it will take another six to eight months for the Lower Parel project to break ground, as approvals are awaited.

The developers stand to make a substantial windfall from their construction contracts, as the state government is shouldering the risks of additional expenses due to delays and cost increases. The developers will construct the apartments in the rehab and luxury towers while Maharashtra state will sell the bigger apartments in the open market.

"The reputed contractors selected for project construction shall ensure timely completion and high quality of construction," said Gulam Zia, senior executive director of real estate advisory firm Knight Frank. "However, funding of the project shall also depend upon sales in the open market."

Once the rehab buildings are ready, the flats will be allotted to BDD residents who will then form an association which will collect the maintenance fees from all members. The first 10 years of maintenance fees will be paid by the government.

High-priced condos have sprung up near BDD chawls in Worli. (Photo by Kamlesh Pednekar)

The BDD redevelopments will change the entire aesthetic of Mumbai and, backers say, help increase the standard of living for many residents. "A large part of Mumbai's population has been struggling for years in cramped spaces and making peace with it. They can see the real impact of development in the country," said Ritesh Mehta, a senior director at Jones Lang LaSalle (JLL), a real estate advisory firm.

It will be the better part of a decade before it is clear if the projects are a success. Previous attempts at redevelopment failed in Mumbai as residents did not want or could not afford new homes in the same area that saddled them with expensive monthly maintenance fees.

"The construction quality of the Tatas, Shapoorji Pallonji Group and L&T is very high and we have taken care of all the issues raised by the residents," said Sunil Shinde, a former member of the state assembly from Worli constituency.

A congested street in Dharavi. (Photo by Kamlesh Pednekar)

But skeptics remain. Sudhir Bhandare, a 38-year-old office assistant and BDD resident, said even a 500-square-foot home is not enough. "The government should give us 600-square-foot homes and make maintenance free forever. As of now, there will not be any maintenance fee for the first 10 years but as most of the residents are earning low income, they will not be able to pay maintenance fees later. Many will sell out their new homes and settle in distant suburbs," he predicted.

Real estate prices in Mumbai are the most expensive in India. According to JLL, high-end properties -- those in buildings with amenities such as swimming pools and clubhouses -- fetch 22,500 rupees per square foot in Central Mumbai and 35,850 rupees per square foot in South Mumbai, compared to around 20,000-22,000 rupees per square foot in prime areas of New Delhi and 17,000-19,000 rupees per square foot in Bangaluru, the nation's tech hub.

That can make it unaffordable to many in the young workforce. Several global multinationals like Amazon, Walmart and Apple skipped Mumbai and built their headquarters in other cities.

Shinde says the prices of real estate could come down substantially in Central Mumbai if the BDD redevelopment succeeds in increasing supply in the area. The project will free up prime land which can make the city affordable to new migrants, he said.

"We have promised to hand over the keys of new homes in the next three and a half years," he told Nikkei Asia. "If all three redevelopments succeed, it will change the face of Mumbai. The issue is timely completion."

Until then, residents like Pratap have to wait. "The lives of our generation are almost coming to an end. But I don't want the next generation to suffer like us. That's why we want this project to succeed," he said.

"Our children's future is now tied to this project."