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REALTY: NAREDCO Summit – Real Estate is engine of growth for economy

National Real Estate Development Council (NAREDCO) organised two day Summit on Real Estate Infrastructure and Investment last month in Mumbai. The major focus was to highlight that infrastructure; housing and real estate is the engine of economic growth of the country because of their huge backward and forward linkages with other sectors of economy. With various initiatives and reforms introduced by the NDA Government, the housing sector is ready to attract overseas investments.

The intense deliberations involving various stakeholders from the real estate sector called for driving the mantras of transparency, predictability, partnerships, uniformity, affirmative actions, long term growth and sustainability in taking India’s real estate sector to unprecedented heights. The two day summit that included panel discussions, debates and presentations on varied topics.

Rajeev Talwar, Chairman-NAREDCO and CEO-DLF Ltd said, “RBI should expand the scope of 'priority lending’, to cover lending to developers involved in low-cost and affordable housing, as cheap funding is critical for developing low cost housing projects. Availability of land for development is the need of the hour for creating affordable housing and improving infrastructure.”

Real Estate Investment Trust (REIT), recently launched by SEBI, will be a step in the right direction for the sector. Providing tax incentives to REITs for investment in housing, especially the affordable housing, will give much-needed fillip for investments in the sector. The secondary mortgage market needs to be promoted by the RBI through Mortgage Backed Securities (MBSs) and Collateralized Mortgage Obligations (CMOs) with safeguards in place to avoid a sub-prime crisis in India, deliberations at the Summit concluded.

Parveen Jain, President-NAREDCO and CMD-Tulip Infratech, said, “For every rupee invested in construction, 78 paisa is ploughed back to the GDP and a unit increase in final expenditure generates additional income five times. Looking at India’s potential, construction sector is capable of contributing 15% of the GDP by 2030 and employ 75 million workforce. The size of Indian construction market is expected at 1 trillion US dollars – 3rd largest globally”.