Govt planning to give real estate sector industry status

Continuing with the reform agenda, the government is now planning to give the much awaited industry status to the real estate sector which will help sector get access to cheaper finance from banks.

"There was a long pending demand from the developers to accord industry status to the real estate sector which is one of the key sectors in terms of development. Now the government is planning to give industry status to real estate sector and infrastructure sector," a senior official from the ministry of urban development told Mail Today.

According to the official, the proposal has already been submitted to the finance ministry for its consideration. "The government has formed a committee comprising representatives from ministry of urban development, ministry of finance and ministry of housing and poverty alleviation. The panel will submit its report to the cabinet before the forthcoming winter session of the Parliament," the official added.

"We expect the process to be over before the next budget," he added. In the last four years the sector was continuously seeking industry status, however, demand grew stronger with rising land cost, lack of funds and lack of transparency.

"The industry status for the sector is an urgent need. Construction business is the second largest employer in the nation after agriculture. It accounts for over 5 per cent of GDP growth. Moreover, the sector also supports other industries including steel and cement. Yet it has not been accorded industry status.

Industry status for the sector will improve funding and bring more transparency," Anil Kumar Sharma chairman and managing director, Amrapali Developers told Mail Today.

According to Anuj Puri, chairman and country head, of Jones Lang Lasalle,"Lack of industry status has deprived the sector of benefits including lower interest rates on loans".

"Providing Industry status along with a regulator will bring transparency in the sector, which is marred by link to one corruption case after another. Also it will help in stabilising home prices," Geetamber Anand, officiating president CREDAI (NCR), the apex body of real estate developer said.

Courtesy: Mail Today