The fdi story so far

HT Estates - - FRONT PAGE -

The begin­ning: The real es­tate sec­tor was opened for for­eign in­vest­ments in the year 2005 and has re­ceived 5% of to­tal for­eign di­rect in­vest­ment (FDI) in­flow since then. How­ever, much more is re­quired The re­sult: Fol­low­ing the govern­ment’s pol­icy to al­low FDI in the sec­tor, there was a boom in in­vest­ment and de­vel­op­men­tal ac­tiv­i­ties. The sec­tor wit­nessed the en­try of many new do­mes­tic realty play­ers and the ar­rival of many for­eign real es­tate in­vest­ment com­pa­nies The im­pact of eco­nomic slow­down: There was a pe­riod of slow­down in for­eign in­vest­ments af­ter the global fi­nan­cial cri­sis in 2009, largely ow­ing to exit pres­sure from in­vestors and a weak global econ­omy Fresh re­forms: To en­able the realty sec­tor to meet the mas­sive cap­i­tal re­quire­ments, the govern­ment has re­cently an­nounced re­forms such as re­lax­ation of the FDI limit and pass through sta­tus to REITS Re­lax­ation of FDI limit: The govern­ment has an­nounced re­duc­tion in built-up area and cap­i­tal con­di­tions for FDI from 50,000 sq m to 20,000 sq m, and from US$10 mil­lion to US$5 mil­lion, re­spec­tively, with a lock-in pe­riod of three years post com­ple­tion of min­i­mum cap­i­tal­i­sa­tion

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