Realty 2010 launches "Indian Real Estate 2010" prepared by CII and Grant Thronton, the report outlines the bright prospects of Real Estate sector in times to come~The regulations should not just discipline the developer but also the authorities concerned: Mr Kabul Chawla
As the government of India is committed for providing shelter to all, the participation is private sector is being promoted. The government has been facilitating development of housing projects by private enterprises, to this effect the private sector should look at a coming up with modular projects like rental housing projects and treat such projects as any other realty product, announced Mr. Saugata Roy, Hon'ble Minister of State, Ministry of Urban Development, Government of India. He was speaking at 'Realty 2010, 6th International Conference on Real Estate - Changing Contours: leading the shift' organized by the Confederation of Indian Industry (CII).
Mr. Roy also said that making all the cities of India slum free was also a promise made by Hon'ble President of India in June 2009. Towards this initiative states would have to commit themselves to a "whole city approach" so that an integrated and holistic plan is prepared to upgrade all existing slums. Government has also been focusing on augmenting the land supply to increase the stock of affordable housing and we appreciate that the Supreme Court of India today released 31,000 acres of land in Delhi for the development of the city.
The minister during the event released a report titled, "Indian Real Estate 2010" prepared jointly by CII and Grant Thronton. The report envisages regulatory, governance and finance related issues in Real Estate sector. As per the report, Real Estate has been the fastest growing sector in India during the few years before recession, and now with positive signs of recovery witnessed in the economy, it is the opportune time to address issues that will help boost the growth of the sector in the long run. The report discusses an array of significant issues and takes into account customer's perspective along with the industry. The report also outlines that the opening up of new avenues such as Real Estate Investment Trust (REITs) and funds will translate in further refinement of the sector towards making it globally competitive market place.
The minister during his address at Realty 2010 outlined that the role of the government in this sector has now been perceived as a facilitator. Through the National Urban Housing and Habitat policy of 2007, government seeks to enhance spotlight on habitat with a regional planning approach. Furthermore the Jawaharlal Nehru National Urban Renewable Mission (JNNURM) aims at facilitating cities to take financially sustainable initiatives to improve service levels. The mission focused on integrated development of infrastructure services, securing linkages between asset creation and maintenance for long term project sustainability, accelerating the flow of urban sector investments, planned development of cities, renewable and redevelopment of inner city areas and universalisation of urban services. Setting up of Real Estate Regulatory Authority, in every state is a step to monitor construction, sale, transfer and management of properties, and thereby generating credibility in property transaction system.
Mr. Rajeev Talwar, Group Executive Director, DLF Limited outlined that Model regulators bill draft released by the government has initiated debates across all the segments of Industry. Realty 2010 played a critical role in providing a platform to discuss the bill. Close interaction between consumers, governments, and industry will help in coming out of a well articulated bill. A controlled sector like Real Estate has been come in light with lots of complaints. As the sector opens up, it is likely to get subject to better regulation and increased supply.
Talking about the future trend in Real Estate, Mr. Talwar said that housing should be affordable and at the lowest cost aimed at empowering the consumer, and not to subject them to any harassment.
Mr. Kabul Chawla, Managing Director, BPTP, said that it is critical to analyze how the state government will merge the Real Estate bill into the existing system. The industry welcomes any regulations aimed at streamlining the process. The regulations should not just discipline the developer but also the authorities concerned. The Real Estate sector faces interest rate hike and liquidity issues, and any policy initiative should aim at empowering the consumers.
Mr. S.S. Kohli, Chairman & Managing Director, India Infrastructure Finance Company Limited stated that Realty is the second largest employer in the country after the agricultural sector; however lack of skilled manpower for the sector will be a challenge in future. Complimenting the government on bringing out Real Estate draft bill, Mr. Kohli said that it may create confidence in Real estate and solve problems that may arise in times to come.
Mr. Harpal Singh, Chairman CII Northern Region, Mentor & Chairman Emeritus Fortis Healthcare Limited & Chairman, Impact Group reiterated that quality of transaction in the real estate system must improve. Besides coming up with suitable reforms to instigate professionalism in the sector, the government should actively look into accelerating green movement within the sector.
Mr. Vishesh Chandiok, National Managing Partner, Grant Thronton said that of-late additional avenues of Real Estate financing have opened up like Real Estate Investment Trust and Real Estate Mutual Fund. FDI is expected to increase six folds in the coming ten years. Bank loan financing for the rector has increased by USD 5 billion during 2006-2009. Moreover a public capital of USD 3-3.5 billion is available to Real Estate. Such factors help in identifying bright future prospects of the sector.
Mr. Madhukar Tulsi, Conference Chairman & President IREO Management Pvt. Ltd said that during the global financial downturn, the government has facilitated the sector through supportive fiscal policies, there by ensuring growth and stability. Now as the economy is getting back in shape, the end users are back. This call for identifying sustainable solutions, share lessons learned from the crisis and keeps track of important developments.
Reality 2010 this year focuses on diverse topics ranging from regulatory, governance & transparency and financing issues. A session is also devoted on developing a plan for adopting International Financial Reporting Standards (IFRS) in Real Estate Sector. The sessions throw light on lessons learned from the past, opportunities for future, single window clearance, environment planning and design, urban planning, public policy changes to support the sector, pending policy issues with the government, strategies for raising funds, capital disbursement, tax regime on accountance repatriation, tax implications of the proposed Direct Tax Code and GST, amongst others.
10 February 2010
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