Top Indian Managers Reflect on 2014 Budget Allocation
The CEO and Managers of prominent companies give their opinion on whether the new budget will open the door for real estate growth and development in the country.
R. Nagaraj, President of CREDAI Karnataka, is optimistic about this year’s Union Budget allocation towards infrastructure and real estate development. According to him, domestic and Foreign Direct Investments will generate a multitude of employment opportunities, thereby increasing the country’s GDP.
Managing Director of International Copper Association India, Sanjeev Ranjan feels that the new budget is an expression of the government’s understanding to overcome obstacles that stand in the way of development. The government’s own investment of Rs 37,800 crore on road connectivity projects through NHAI, Rs 11,600 crore on harbour and airport development in tier-I and tier-II cities, provision of affordable housing options for rural and urban population, and the implementation of REITs for retail investment is surely a positive outcome of the 2014 budget, according to Rajan.
Rahul Sabharwal and Srinivas Rao, the CEO’s of VBHC and Asia Pacific-Vestian respectively, both feel that the tax incentives, housing interest deductions, and the $40 billion affordable housing investment will go a long way in facilitating real estate growth for the country. Sabharwal is pleased with the liberalised FDI policy in smart cities, while Rao finds scope for FDI-decreased in-built space to further develop infrastructure projects like the metro rail.
According to Sanjay Dutt, South Asian Executive Managing Director of Cushman and Wakefield, real estate developers will no longer find affordable housing projects unviable. If developers offer a 30% commitment to this project, then the minimum capitalization and FDI area criteria can be waived.
Contrary to this, Anuj Puri, the Chairman of JLL India, takes a different view as he states that the 2014 budget is insufficient to bring down the 17% increase of construction costs, subsequently adding pressure to the developer’s capital resources. However, he approves of the paramount importance given to the infrastructure and manufacturing sector in the form of CRR and SLR exempts and norms for priority sector lending. Bank involvement acts as a catalyst that speeds up infrastructural activities and real estate development.
Source: The Hindu
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