In a ruling that could change the face of Mumbai, the Supreme Court has cleared the way for pulling down more than 16,000 pre-1940 buildings — including chawls — that have become dilapidated, and constructing modern high-rises in their places. The ruling has devised a win-win formula according to which people who occupied the old tenements will be given, free of cost, flats of the same size in brand new buildings. Other flats in the building can be sold by the builder, who has been allowed to make his money by relaxing the floor space index (FSI) to permit the construction of high-rises. Cities across the world tackle housing shortages through redevelopment and the construction of high-rises. But rules governing land use remain archaic in Indian cities. That includes FSIs that are low by international standards, inhibiting the construction of high-rises. Coupled with other restrictive legislations that hobble the real estate sector, the net effect is acute housing shortages and the proliferation of slums. Even among Indian cities Mumbai is a byword when it comes to housing shortage or lack of commercial office space. Inability to resolve the former means that the city offers a poor living standard to its residents. And unless it can tackle the latter it can bid goodbye to its dreams of becoming a global financial hub. The boost in public morale from shifting millions of people from slum tenements to pucca houses cannot be overestimated. It compares only to the sense of well-being that can come from advances in education or public health. But the same story of housing and infrastructure shortage plays out across most Indian cities. High-rises are restricted across large parts of New Delhi, leading to soaring property prices and the lack of commercial space. The rationale for restricting high-rises is that they strain municipal services unduly. But since they don't in other parts of the world, that points only to the infirmity of Indian cities in providing basic services such as water, sewage and transport. Rains routinely cripple cities like Mumbai, Delhi and Kolkata because municipal authorities aren't doing their job. The proper solution isn't downgrading FSI but upgrading municipal services, which ought to be outsourced to private providers if public authorities can't come up to the mark. Studies should be made into what makes great cities across the world tick in terms of zoning laws, land use regulations, operation of municipal services, permitted FSIs and the aesthetics of urban architecture. Similar norms should be put in place to give rise to world-class cities in India.