Why Mumbai’s old business district is so shabby

Every indian business dreads waking up to a bill from the state. So too the Taj Mahal Palace. The Mumbai Port Trust, owner of the land upon which the landmark hotel sits, is demanding $92m in retrospective rent for the years 2012-22. The Taj, which is owned by Tata Group, a conglomerate, has called the demand “exorbitant and untenable” in a petition to the Bombay High Court. The claim’s size and the Taj’s prominence make the claim unique. But many tenants get similar treatment. As a result, Mumbai’s old business district, once home to many global firms, has slid into disrepair.

Mumbai grew out of a natural deepwater harbour. The Port Trust was established in 1873 to administer both shipping and ancillary businesses such as piers, warehouses, refineries—and hotels. Rather than sell land outright, the trust leased plots on 940 hectares (2,300 acres) for periods of up to 99 years. All those original leases have expired, the Taj’s at the turn of the millennium.