India, the fifth largest economy in the world, is also the fastest growing trillion-dollar economy in the world. In the Union Budget announcement for the F.Y. 2020-21, the Finance Minister, Nirmala Sitharaman envisioned India to be a five trillion dollar economy in the coming years and will be powered by technology.
The FM’s theme for the F.Y. 2020-21 is aspirational India, economic development and caring society. The Union Budget envisions India to be one of the most preferred destinations for education in the world. Expansion of educational facilities demands infrastructural development, which in turn urges the growth of the realty sector. All of these factors are interdependent.
On February, 1st, 2020, some key announcements were made that will impact the realty sector and its other dependent/interdependent factors. Let us take a look at these factors. As per a report by the Economic Times, the key highlights of the Union Budget are as follows:
For Affordable Housing
Concession to real estate transactions
Dhruv Agarwala, CEO of Housing.com, Proptiger.com, and Makaan.com said that this move can possibly make the transactions process of real estate seamless where the market rates are 5 to 10 percent below the circle rates as reported by the Financial Express.
Rs 1.7 lakh crores will be given for transport infrastructure in 2021 which will accelerate the development of highways and in turn boost the realty sector. The infrastructural development will include the following:
The neighbouring areas of new airports and smart cities will demand development of residential and commercial spaces. This will include housing apartments, row houses, co-living space, co-working space, office space, supermarkets, retail stores, shopping and dining centres, healthcare centres, recreation zones, etc.
As reported by Telegraph, Abhilash Pillai, Partner, Cyril Amarchand Mangaldas said, “More govt warehouses on govt land is a welcome step. It should be developed with state of the art facility under the PPP model and should have unhindered access. This will help in increasing production and sales. FCI & WCI can also lease out excess space available to private operators.
More hospitals, educational institutions, and manufacturing facilities are expected to boost up the demand in the real estate and construction sector.
Info on the land bank can be easily collated and made available if land titling legislation can be implemented across the country with the help of AI and digital governance. Technologically advanced States should be asked to help other States in implementing this.
Incentives should be given to the States who are proactive in setting up an e-land bank. This will also help in completing the development of Smart Cities, PMAY – Urban & Rural.”