DELHI: The Government is looking to lower the minimum built-up area for attracting foreign direct investment (FDI) in housing projects to 20,000 square metres from the current 50,000 square metres.
“This would boost FDI flow into the sector, Arun Kumar Misra, Secretary, Ministry for Housing and Urban Poverty Alleviation (HUPA), told Business Line here.
Misra said his Ministry would urge the Department of Industrial Policy and Promotion (DIPP) in the Commerce and Industry Ministry to change the current stipulation on built-up areas.
In real estate, FDI is allowed up to 100 per cent through the automatic route so long as certain conditions are met. One of the conditions is that the built-up area should be at least 50,000 square metres.
Misra also said that lowering of minimum built-up area norm would benefit medium-sized developers, as they would be able to attract FDI into their projects.
“If you keep the minimum built-up area norm at 50,000 square metres, only big developers will benefit,” Misra said.
REAL ESTATE REGULATOR
Misra said that the Real Estate Regulatory Bill, which has received Cabinet nod, was likely to be taken up during the upcoming monsoon session of Parliament beginning August 5.
The Bill is expected to pave the way for establishment of a regulatory authority to ensure accountability, fair practice and fast-track dispute resolution.
There is an estimated demand of 15 million homes for low-income customers, with a monthly household income of Rs 10,000-25,000, who can afford privately built formal housing costing Rs 4-10 lakh without any Government aid.
This is one of the key findings of a Monitor Deloitte report on the ‘State of the Low Income Housing Market’ released on Wednesday.
This estimated demand translates into an opportunity of Rs 9 lakh crore for developers and Rs 7 lakh crore for housing finance companies, the report has said.