Role Of Real Estate Industry In The Growth OF Indian Economy
The real estate industry in India has been contributing towards the overall economic growth of the nation in a significant manner. Over the past, couple of decades the phenomenal growth of real estate sector across the length and breadth of India has been seen as direct consequence of the enhanced buying and spending capacity of the common people. In addition, the breaking up of the joint family system due to various reasons has also created a huge demand for residential and commercial spaces to accommodate the smaller nuclear families. In fact, India is amongst the few nations, where the real estate market did not suffer a major setback even during the darkest phase of recession.
New Government, New Expectations
Sadly, over the past few years an unusual lull had been seen in the real estate sector as well. Most people blame the wrong policies, inefficiency and weak governance of the previous central government for the reduced growth rate in construction business. However, with the phenomenal win of Mr. Modi and him forming the government at the centre, the real estate big wigs have become hopeful that the industry will be revived from its downward spiral and will once again play a critical role in building a national growth and development. The positive attitude and the optimistic approach of the Modi government towards ensuring greater economic progress are being seen by the major players in the real estate industry as the signs of a better and progressive future not only for this specific sector but for the nation as a whole.
With infrastructure development and homes for everyone being one of the top priorities of the Modi government, the expectations of growth of real estate sector is being considered quite natural. In fact, the new government has already started taking several measures to ensure that the funding for this specific sector can be organized in an easy and hassle free manner. At the same time the real estate developers are also revamping their systems and policies to meet the changing needs of their clients while also playing a constructive role in helping the new government fulfill its promises.
Modi’s US Visit – First Step towards Turning Dreams into Reality
During his recent visit to the United States of America, PM Narendra Modi gave positive indications about enhancing growth and development in various sectors including real estate in India. In addition to highlighting and promoting the concept of “Make in India”, the PM also appealed to the NRI to invest in real estate in India in a big way. The fact that the real estate sector contributes towards nearly 10% of India’s GDP as well as the need for over USD 650 billion in terms of investment in this sector is being seen as a prominent reason behind PM Narendra Modi’s appeal.
In order to motivate the NRI’s to make investments in the real estate sector, the Modi government plans to permit 1005% FDI automatically for construction of townships and cities. For comprehensive infrastructure development in India a total investment amount of USD 1,000 billion will be required by the end of 2017. The government also made it clear that 45% of these funds will be used for different construction activities. It is also projected that the real estate sector in the country will grow to have a value of nearly USD 140 billion, which is almost twice the value the industry had by the end of 2013.
Scope Of Real Estate Growth In India
According to an estimate, India currently faces a shortage of nearly 18.8 million residential units. In addition, the current infrastructure is not capable of meeting the growing demands of the increasing urban population. The need to re-organize the existing cities and urban centers as well as create new, all inclusive smart cities to meet the lifestyle needs of the modern population. In order for sustained growth and development, the real estate sector is increasingly adapting smart construction and development policies by working closely with foreign players and private investors.
At the same time the real estate developers are focusing on providing affordable residential spaces that are Eco-friendly and sustainable. In addition, the property developers have also begun to understand the importance of combining technology and latest construction methodologies to build self sustaining smart cities and integrated townships that can easily appeal to NRI’s and other foreign investors as a profitable option. Most importantly, the government is working on various policies and laws to create greater transparency and efficiency for encouraging investment in the real estate sector in a hassle free manner.
The Benefits of Real Estate Investment In India
A major highlight of PM Narendra Modi’s US visit was to project India as a land of enormous opportunities especially in the real estate sector. With the construction and infrastructure needs of the nation growing at a rapid pace, NRI’s and other foreign investors investing in real estate in the country are sure to gin big time with even a small investment. Furthermore the encouragement and support offered by the government not only in terms of both easy investment policies and financial assistance is also bound to attract investors in large numbers.
All Images used for illustration purposes only.
The real estate sector in India offers wide range of investment opportunities for people from diverse backgrounds. The statement made by PM Modi about providing a home to every family by 2020, is being considered by the pundits in the real estate sector as the indicator of the growth and development plan of the new government. This single statement combined with the numerous positive steps taken by the government, including the launching of the urban development mission, has laid the path for significant growth of the real estate sector across the nation. The boom in property market is all set to take the nation further enhance the GDP growth of the nation and contribute in significant manner towards making India an economic superpower on a global level.