Get All Access for $5/mo

Indian Real-Estate Sector Wants Modi-government To Focus On These Four Issues In Upcoming Budget Indian real-estate sector in the recent times has been disrupted by various initiatives like the demonetization, GST and the introduction of RERA

By Vanita D'souza

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Shutterstock.com

Since the present BJP-led government came to power, affordable housing has been one of the top things on the government's to-do list. Indian real-estate sector in the recent times has been disrupted by various initiatives like demonetization, goods and services tax regime (GST) and the introduction of Real Estate Regulatory Authority (RERA).

With Finance Ministry prepping up to announce its last full-fledged Union Budget under the present regime before the country goes to polls in 2019, the government is anticipated to adopt a please-all strategy for individuals and India Inc., including the real estate sector.

Following are some issues plaguing the real-estate sector that the government could address in the upcoming Union Budget 2018-19:

Single-window Clearance

The clearance and approval process for residential real estate projects has been an impediment for a long time. Although many initiatives have been taken to create a conducive business environment in the sector, the demand for single window clearance mechanism in totality is yet to be fulfilled.

If implemented, ANAROCK Property Consultants said single-window clearance can significantly reduce the overall projects cycle time and developers will be able to focus on their core business of project execution.

"Post-RERA, it has become all the more important to facilitate smooth clearances and approvals so that there are no execution delays due to procedural hindrances," added Anuj Puri, Chairman - ANAROCK.

Industry Status

Affordable housing witnessed an increase of 20% in the new launches in 2017 as compared to 2016 and this trend will continue, says Amit Ruparel, Managing Director, Ruparel Realty and therefore, this year the government should focus on providing industry status for the real estate sector as a whole which will ensure easier access to institutional credit and help in reducing developers' cost of borrowing for projects.

Incentives for Green Buildings

Cost of construction for green buildings is expensive and this is what has kept a majority of developers away from such projects. Taking a view of India's deteriorating urban environment, Puri suggested that incentivizing green real estate project is the need of the hour.

"Keeping in view the current and certain future challenges to the environment, the Government should encourage developers with higher incentives in terms of FSI and/or some degree of tax exemption to encourage them to adopt green building technologies," he shared.

GST

Ruparel and Puri both advised the government to reduce the present GST rate, which will boost the buyer sentiment in the industry. Presently, a GST of 12% is levied on an under-construction property which is significantly higher than the previous tax rate.

"Additionally, stamp duty and registration charges are outside the ambit of GST, hope in this budget, the government subsumes these levies into GST," Ruparel added.

Vanita D'souza

Former Senior Correspondent, Entrepreneur India

I am a Mumbai-based journalist and have worked with media companies like The Dollar Business Magazine, Business Standard, etc.While on the other side, I am an avid reader who is a travel freak and has accepted foodism as my religion.

Business News

Homeowners in These 10 States Pay the Most in 'Hidden' Upkeep Costs

Hidden home costs pile on top of mortgage payments.

Science & Technology

Why We Shouldn't Fear AI in Education (and How to Use It Effectively)

Facing resistance to new technologies in the educational process is nothing new, and AI is no exception. Yet, this powerful tool is set to overcome these challenges and revolutionize education, preparing students and professionals for a future of unparalleled efficiency and personalized learning.

Business News

Elon Musk Threatens to Ban Employees from Using Apple Products, Says Will Lock Devices in 'Cages'

The Tesla founder sounded off on X following Apple's 2024 Worldwide Developer Conference on Monday.

Business News

Apple's AI Has a Catch — And It Could Help Boost Sales

Not every iPhone owner will get to use the new Apple Intelligence.

Business News

Y Combinator Helped Launch Reddit, Airbnb and Dropbox. Here's What I Learned From Its Free Startup School.

The famed startup accelerator offers a free course on building a business — and answers five pressing questions for founders.

Business News

New Southwest Airlines Major Investor Wants to Force Out CEO, Slams Company's 'Stubborn Unwillingness to Evolve'

Elliot Investment Management announced a $1.9 billion stake in the Dallas-based Southwest Airlines on Monday and is urging shareholders to vote for new leadership.