A city with almost every household having one family member working in the Gulf, Kochi or Cochin’s resident population is waking up to new business avenues. This transition is also leading to a growing demand for commercial and residential property.
The rate at which economy is growing our urban centers shall add at least 100 million people by year 2020 merely on the account of urbanization. To provide housing to so many people India needs to invest a trillion dollars over the next 10 years. This is equivalent to 80 times our education budget allocation for year 2011-12.
It is a highly disappointing budget. The Finance Minister has miserably failed in highlighting the importance the role of Housing in economy, employment generation, apart from the very need of housing. The announcements on ECB for affordable housing is a minor respite but still meaningless.
“For the real estate and housing sector, this years’ budget has exceeded expectations given the pressure on fiscal situation. Most importantly, it has taken into account the crying need to focus on affordable housing sector by allowing ECB for low cost housing, road as well as construction. Withholding tax on ECBs for affordable housing has been reduced from 20% to 5% for 3 years and this move will help ease the liquidity in the sector.
The Union Budget 2012-13 has left the Indian real estate sector grope with the indecision yet again and everyone is wondering whether the Finance Minister’s offer is glass half full or half empty for them.
The share of housing sector to the overall GDP (gross domestic product) is likely to rise by one per cent to 6 per cent on increased investment.
The Economic Survey, while recognising the importance of the services sector (it accounts for 59 per cent of gross domestic product), has raised concern over the second largest economic activity–housing & real estate. Three months after the government rolled back its decision to allow 51 per cent foreign direct investment (FDI) in multi-brand retail, the survey referred to it as a major challenge before the sector.
Real estate developers today expressed disappointment over the RBI’s decision to keep key policy rates unchanged and sought a cut in interest rate to boost housing demand.
Pranay Vakil: Let’s start by introducing ourselves. I am Pranay Vakil, Chairman of Knight Frank India. We are a brokerage and consultancy group, positioned as second in the business.
The recently tabled Land Acquisition, Rehabilitation & Resettlement Bill, 2011 in Parliament is meant to replace the 117-year-old Land Acquisition Bill of 1894.