This paper examines the institutional framework and financial mechanisms for "slum" upgrading in Mumbai, including the use of Transferable Development Rights (TDR), and assesses their strengths and limitations. Although recent innovations through the Slum Redevelopment Authority did not produce the hoped-for scale of slum improvements, it showed more effective possibilities for the future. The paper discusses the historical relationship between the central, state and local governments and slum communities, and the evolution of policies that have affected slum dwellers from the 1950s to the present. It also describes the opportunities that the institutional and legal framework provided for community-driven approaches by the Society for the Promotion of Area Resource Centres (SPARC), the National Slum Dwellers Federation (NSDF) and Mahila Milan. This includes a discussion of how these approaches were financed and of the strategies of engagement used by urban poor federations with the state, the private sector (especially banks) and the World Bank. The paper also identifies the changes needed to make pro-poor slain upgrading more effective and capable of reaching a much larger scale.
