Government Relaxes FDI norms for Real Estate Sector and Construction Sector

Q: Hi, did FDI really put off the norms for construction industry .What is the recent update

Akash Kanojia, Delhi

29th September 2013

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Replies (5)

Hi Akash,

This new rule will also give a boost to the 100 smart cities being planned by the government. Home buyers will also cheer the relaxation as fresh inflows raise the possibility of projects that are stuck getting completed and cheaper housing becoming available going ahead. Most housing projects are running one to two years or even more behind schedule because of the slowdown and the shortage of funds on account of elevated debt levels.

Preeti Kher, Delhi-NCR

7th November 2014

Comment

Hi Mr Akash,

Yes Preeti you are right. This new initiatives taken by Govt, will have a great impact on real estate market. The government has promised housing for all by 2022 and toward that end provided an incentive for affordable housing in the revamped policy.

N.Mathur, Delhi-NCR

7th November 2014

HI Akash ,

According to me, it is an excellent move by the government and will definitely help the developers which are running late with their projects due to the funds crunch. Townships take a minimum of 10 years to be completed, so the relaxation will ensure that funds are not a problem. The norms will come into force after DIPP issues a notification.

Find recent updates on FDI Norms

Jay, Delhi-NCR

7th November 2014

The policy also restricts the investments only to projects which have a minimum built-up area of 50,000 square metres and minimum capitalisation of $10 million for wholly-owned subsidiaries. But to attract more cash-flow in the sector, the draft note seeks to cut down the minimum built-up area limit to 20,000 square metres of carpet area and to decrease the minimum capitalisation limit to $5 million.

Most of the implications made by the Housing Ministry have been added in the draft note. The Department of Industrial Policy and Promotion (DIPP) has requested suggestions from other ministries such as Finance, Home Affairs and the Planning Commission, and after seeking the suggestions, they will also be incorporated in the final note.

Vibhor, Delhi

15th October 2013

Comment

Recently I have read an informative and well written article about FDI norms in the construction industry in India. To know more about it click here FDI norms likely to be relaxed for construction industry

Pranab Malakar, Delhi

15th October 2013

Dude,the current FDI policy demands a lock-in period of three years for the investments made in India by foreign players. The three-year time is applicable right from the date of receipt or from the date of completion of minimum capitalization, whichever is later. But the draft policy proposes to relax this lock-in period for FDIs.

Anwar Mohammed, Delhi-NCR

30th September 2013

Comment

The existing policy allows 100 percent foreign investment, including in housing, townships and construction of infrastructure, although there are several limitations. According to a DIPP official, they need a day or two to finalise the note on relaxing foreign direct investment (FDI) norms in the construction industry in India to be relaxed by the government of India.

Nikhil Agarwal, Delhi

15th October 2013

Guys , you need to understand that, relaxing the FDI norms as proposed in the draft policy would attract more foreign investments to the real estate sector in India. This would give some relief to the cash-crunch developers and would also bring down the prices of properties in India. However, the property prices are not solely dependent on this factor alone.

Tamal, Delhi-NCR

30th September 2013

Comment

Yes, the news is true ..Foreign Direct Investment (FDI) norms in the construction industry in India are likely to be relaxed by the government of India.

Pavan Jain, Delhi-NCR

30th September 2013

Comment

But what is the reason behind that??? Why all of a sudden FDI took such decision.

Sanjay Gupta, Delhi-NCR

30th September 2013

The current real estate market is highly facing liquidity crunch for which the government is looking to boost up the flow of investments in the sector.

Neha Srivastava, Delhi-NCR

30th September 2013