DIPP looking at easing FDI norms for housing

New Delhi The DIPP is "favourably" looking at relaxing FDI norms for the housing sector, including easing the three-year lock-in period, to attract foreign investment.

The proposal to ease the FDI guidelines for the sector was mooted by the Ministry of Housing and Urban Poverty Alleviation.

The ministry has asked for relaxation in provisions, including easing three-year lock-in period for FDI in housing and townships. It has said that the minimum capitalisation should be USD 5 million instead the present USD 10 million for wholly-owned subsidiaries.

It has also suggested a cut in the minimum built-up area of 50,000 sq mts in case of construction development projects to 20,000 sq mts of carpet area.

"There is a need to define the word ' completion' in the current policy on the matter of reducing three year lockin period," a top official of the commerce and industry ministry told PTI.

As per the current FDI policy, the lock-in period of three years applies to every tranche of investment brought in by a foreign player from the date of receipt or from the date of ' completion' of minimum capitalisation whichever is later.

During April 2000 and May 2013, construction development including townships, housing and built-up infrastructure has received FDI worth $22.16 billion or 11% of the total FDI attracted by India during the period.