Real estate industry expects inflow of foreign capital in the sector to be more than 15% after the government eased FDI norms, a survey by industry body FICCI said.
Real estate industry expects inflow of foreign capital in the sector to be more than 15% after the government eased FDI norms, a survey by industry body FICCI said.
With the real estate industry facing a huge slowdown for last 2-3 years, the government last month relaxed foreign direct investment (FDI) norms in construction sector by removing two major conditions related to minimum built up area as well as capital requirement.
"According to FICCI survey, industry is happy and satisfied with current FDI reforms in construction development sector and has shown high level of confidence and optimism towards future flow of foreign capital into realty sector," the industry chamber said in a statement.
The survey amongst various stakeholders comprising developers, investors and consultants was conducted to assess the mood of real estate industry and their perception on relaxed FDI norms for the real estate sector.
"Respondents were optimistic and felt that FDI reform measures will certainly increase flow of FDI into realty sector in coming months.
"About 55 per cent felt that there will be more than 15% annual increase in FDI flow into realty sector, 23% felt the increase to be in the range of 10-15% and 22% felt that increase will be less than 10% annually from hereon," the statement said.
According to DIPP, Indian real estate has attracted about $24.16 billion FDI in construction development sector during April 2000 to September 2015.
However, FDI in construction development sector has been declining over the past few years due to regulatory issues and slowdown in Indian real estate, FICCI said.
Majority of the respondents fell that the commercial and retail sector would receive maximum foreign capital followed by the residential sector.
Almost all respondents felt that the easing of exit norms would cheer foreign investor community and have a major impact on attractiveness of Indian real estate going forward.
To attract FDI in realty sector, industry has suggested that states should put in place a more efficient approval process system of projects.
The states should ensure better governance through measures such as single window clearance, time bound clearances, quicker legal remedies for investors and faster resolution of consumer woes through regulations such as state real estate regulators, among others, it said.
"Both Centre and State must work together to ensure removal of bottlenecks for faster implementation of reform measures to attract foreign investments in real estate," it added.
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