INDIA MOVES FOR FDI IN PROPERTY
New bill aims to improve India’s image
Supporters of a law that was recently passed by both houses of the Indian parliament will bring more foreign direct investment in the country’s property sector.
Money from abroad for construction developments fell by 84 per cent during the first nine months of the current fiscal period compared to the same period last year.
And many industry analysts say part of the problem was bureaucracy and unclear legislation, which the new bill aims to improve.
“The bill will facilitate injecting FDI into Indian real estate,” said Anuj Puri, chairman and country head of global real estate services firm JLL India.
“It essentially works towards strengthening transparency, information in the public domain, accountability and responsibility for developers.
“It will bring overall financial discipline. The bill also provides comprehensive consumer protection which hardly existed before.”
According to the latest data by the central government’s Department of Industrial Policy and Promotion (DIPP), during the first nine months of the current fiscal year, India attracted only Dhs37 million of FDI in construction development. In the same period in 2014-15 the figure was Dhs222 million.
Industry chamber Ficci’s president Harshavardhan Neotia, who is also chairman of the Ambuja Neotia Group, which has interest in real estate, said the legislation would also make it easier to force builders to complete projects on time.
He said: “The bill also aims to put in place a seamless framework for resolving disputes between builders and home buyers. All this is likely to improve the credibility of the sector and make it more attractive for investment.”
The bill, which had been pending since 2013, was passed by the Lok Sabha, or Upper House of parliament, on Tuesday. The Rajya Sabha (Lower House) cleared it on March 10.
The new legislation also provides for the setting up of Real Estate Regulatory Authorities.
All of this is likely to improve the credibility of the sector and make it more attractive for investment
– Harshavardhan Neotia, Ficci president