By: Lalit Kumar Jain, Chairman, CREDAI
Track2Realty Exclusive: Elections are part of a vibrant democracy. And like everyone else who is part of this democratic system, the developer community also pins hope on the upcoming elections. We are, in fact, watching all development with bated breath. We will keenly follow the five Assembly elections to be followed by the general elections of 2014 without any bias and in a totally unattached manner with no political affiliations whatsoever.
Now, let me come down to the brass tacks. For long, the real estate industry has been hit by policy paralysis at the Centre and the indecision on the part of many responsible departments. Whatever little positive developments that we witnessed at the Finance Ministry level, the negative mindset at other levels has plagued the housing industry. This happened, sadly though, despite all the lip sympathy that we got from the powers that be and promises with hollow slogans like ‘Housing for All’ and ‘Affordable Housing’.
We at CREDAI have been relentlessly battling on all fronts for a transparency in all deals but at the end of the day we got only a raw deal and one-sided policies. On the one hand the yawning gap between demand and supply for housing has gone up to 18.3 million, while on the other we have not witnessed any concrete steps to make housing affordable for the people in general. Worse still, real estate developers have been unfairly branded as breeders of black money as if we are the cause and effect of all evils and the rest of the world is full of holy cows!
Take the case of real estate reforms. The government came up with the Real Estate Regulatory Authority (RERA) that seeks to punish only errant developers for project delays and ignoring the wrong doings on the part of other stakeholders. We have no answers to questions like: who will take care of delays in project clearances? Who checks corruption at all levels of bureaucracy? What happens if buyers themselves delay or default payments? Then came the Land Acquisition Act that makes the cost of the most important ingredient of real estate and infrastructure prohibitive.
The half-baked reform agenda has failed to protect the interests of consumers taking into account all stakeholders, including the authorities. Much more could have been achieved without any controversy and even without incurring additional cost by focusing on the housing sector. CREDAI has over 8,000 members through 18 member associations, pan-India. We represent the voice of the industry, yet our viewpoint was ignored. We represented to the government that the regulatory bill was incomplete and even one-sided as it seeks to punish errant developers while ignoring the defaulting buyers and corrupt and procrastinating officials.
CREDAI has been relentlessly campaigning for all-round reforms especially administrative, land, fiscal, tax and banking reforms that will boost GDP growth, ensure transparency in clearances of housing projects and provide homes to all. We also suggested steps like single window system to eliminate human interface that breeds corruption and make funds available to both developers and buyers at reasonable and affordable rates of interest. The single window system of clearances that was already introduced in Punjab and other states like Karnataka and Andhra Pradesh are moving in that direction. It is time that the Centre also took initiative and drew guidelines for all States.
The reforms must also include provisions to punish officials who are either corrupt or just sit on files to draw a vicarious by inordinately delaying proposals from developers. For instance, the environment departments cause green terror by not approving proposals for months and years. We presented a ten-point action plan to rejuvenate the real estate sector, which will help the economy to grow at much faster rate since realty contributes to the growth of 200-plus other industries, including transport at every stage.
It does not require rocket science to realize that real estate is capital and labor intensive which makes it the largest employer after agriculture. We heard on the oft-repeated demand for reducing the housing prices. We at CREDAI have already appealed to our member developers to consider reducing the prices to the extent possible. On the issue of unsold stocks, we ourselves have asked member developers to start selling even at rock bottom prices. No prudent businessman likes to sit on unsold stock and we too have several constraints as the cost of construction has been zooming with no signs of any control and hence we urge to look into this issue seriously.
…to be continued
