Greater transparency, a quick and effective legal system and a clear regulatory framework are critical requirements for FDI inflow, which could hold the answer to the growing urban housing needs, says RAJIV DOGRA The recent issue of foreign direct investments (FDI) in retail brings to the fore its implications in the realty sector too, which generated much enthusiasm when the government liberalised its norms way back in 2005. FDI is an essential component of an open and effective international economic system and is considered as a major catalyst for development. "The Indian-built environment, too, has been witness to some of these changes, with a revision in the FDI policy for infrastructure, housing and townships in 2005, coupled with the SEZ Act of 2006," says Sachin Sandhir, Managing Director, RICS South Asia. However, the lingering structural and policy related issues with respect to lock-in requirements and exit routes coupled with the existent inflationary pressures and rising interest rates have had a dampening effect on the investment environment. Consequently, the real estate sector has seen a dip of approximately US $2.6 billion in FDI inflows in 2010-11, attracting just US $1.6 billion in comparison to 2009-10. Furthermore, Sandhir observes that investor sentiment has also been impacted on account of the continuing economic crisis in the eurozone and the US. Additionally, slower GDP growth rate projections in the country; capacity constraints of approximately 44 million skilled professionals in the built environment and high debt burdens of real estate developers are also likely to affect FDI in the sector. In a similar vein, Naushad Panjwani, Executive Director, Knight Frank India, says, "There are basically three reasons: the politicalinsecurity, instability on the growth factors and land reform issues, which are rampant, and there is a crying need to bring in reforms. Moreover, there is no regulator and execution is a huge challenge due to the fall in GDP." Similarly, Atul Goel, MD, Goel Ganga Group, observes that the RBI has been restrictive about external commercial borrowing. According to him, greater transparency, a quick and effective legal system and a clear regulatory framework are critical requirements for FDI flow into the sector. The Centre allowed up to 100 per cent FDI for setting up townships in 2002. However, the flow of FDI investments has been thwarted by the 100-acre criterion; since acquiring such a large chunk of land was impossible in metropolitan cities and even satellite cities like Significantly, FDI inflows provide a healthy stream of capital and provide a platform for foreign equity participation to broaden the base of residential real estate development. "It is, therefore, recommended to provide adequate impetus to the sector in the form of further relaxation in FDI norms for the development of townships, housing, built-up infrastructure and construction-development projects as a whole," Sandhir says. However, Rohit Gera, Joint MD, Gera Developments, begs to differ on the criterion of 50,000 sq m area limit for an FDI partnership and says it's a "well thought limit". "Though FDI might seem essential, there is also a need to protect the interests of smaller real estate developers, especially in the context of Pune. Foreign players with capital strength would prove to be a risk. We need to be a bit selfish about our interest and think whether we really need foreign capital," he says. On the contrary, CREDAI President Lalit Kumar Jain states that the cap on FDI is in fact a barrier and relaxing the norms will help bring more foreign currency into the market. "Structural funding is a way of life and the government needs to be flexible about it. Availability of funding will foster more expansion and development in the market and in fact encourage everyone to build," he shares. India in the next five years is estimated to require investments worth US $25 billion with the urban housing sector. Industry body ASSOCHAM, in fact, expects FDI in the Indian realty sector may achieve six-fold to US $30 billion in the next 10 years. The sector is expected to grow more than 30 per cent in the next few years. Meanwhile, with respect to the Consolidated FDI policy that the Department of Industrial Policy and Promotion (DIPP) is proposing, a minimum area of development of townships, housing, built-up infrastructure and construction- development projects should be stipulated within the FDI policy, suggest realty experts. It's been said that FDI in the real estate sector in India would also contribute towards making the sector more organised. Besides increasing professionalism in the sector, it would bring in advanced technology and help in the creation of healthy and competitive market environment for both domestic and foreign investors.
I’ve been a sports person, and also captained my throwball and volleyball teams. I understand the importance of extracurricular activities in our growing up years.
Trainings provide a child with the required discipline when working within teams as well as gives one the chance to follow what makes you happy. It also enables an overall development!
Dance has been my passion since I was a child and I have been thrilled to see both my little ones have this in their genes too.
This opportunity really came to my doorstep through Gera. My daughters Lavanya and Diya have had an enthralling experience being a part of not just one but three Academies (The Shiamak Davar Dan..
I cannot thank you enough for making our journey with Gera so so interesting and mind-blowing. I had never ever imagined my life taking a beautiful turn with me beginning to start my career as a music teacher that too with SMA (Shankar Mahadevan Academy) and all this has been possible only because of GERA and YOU my dear.
It is only because of your efforts and kind gesture that I could meet the man himself (Shankar Ji) and have a small recording session with him. That was like a dream come true.
I am super excited to start my journey with SMA and Gera as a teacher now.
Apart from that, Me and Prateek have always been grateful to you for making Shiamak happen for us and I ..
It was indeed a pleasure being a part of the Christmas celebrations at Astoria. Kudos to the Gera team for bringing in such a wonderful event with great carol singing participation from our own kids. It brought in the spirit of Christmas and the games, Santa, the gifts only added to it. Thanks for organising such a wonderful event which helped in community building...looking forward to many more such celebrations!..
The Christmas event organised at Astoria was a big success and a big step in bridging the gap between us and Gera. It was a memorable event as we are still in the beginning of our journey of life in our little home at Astoria. The kids have been the happiest of all and what more can we ask for when we see smiles on the faces of our little ones. Kudos to you and your team for making this event a huge success! Looking forward to many more in the years to come...
The Christmas party organised by Gera at Astoria this year was a great success with good participation from kids and parents. Our children Sia and Saish enjoyed the party to the fullest. Sia, in particular, had a gala time and reiterated her stand that Anita aunty's parties are THE BEST.... We as your customers take much pride in informing our friends that such goodwill gestures are one of the many differentiators Gera brings to us, which no other builder in Goa can boast of. Many thanks to you and your team for doing an excellent job in putting up this event. We look forward to the next one! A big thanks to the Gera Management for its efforts in community building...