|Photo: Dun & Bradstreet|
With improvement in the economic scenario in FY16, the construction sector is seeing huge investments from GoI and private players. Overall, the domestic real estate/construction industry is poised to grow exponentially, backed by massive infrastructure building programmes initiated by GoI. Increased GoI focus on infrastructural development such as construction of roads and bridges and power projects is a major growth driver for this industry. In addition, mounting demand from increase in population will drive the need for increased capacity in housing, transport and utilities sectors.
The analysts feel that the real impact of latest FDI liberalisation measures on foreign investments in Indian real estate will be reflected over a period of time. 100% FDI under automatic route in completed projects for operation and management of townships, malls/shopping complexes and business centres is a significant step taken by the Government. Also, Quick implementation of the Real Estate Regulatory Bill (RERA) will support the realty market to attract FDI. Sources say, that the Government of India is considering a reduced lock-in-period applicable for FDI investments from 3 years currently to 1-2 years to further enhance investor interests.