CHENNAI: The real estate sector is not getting adequate support from banks and policy makers despite its contribution to economic growth, according to Lalit Kumar Jain, Chairman, Confederation of Real Estate Developers Association of India (CREDAI).
Over Rs 50,000 crore of bank loans are on the verge of being treated as bad debt as banks refuse to restructure these loans even though adequate collateral is available with developers, he added.
Addressing the inaugural of Southcon 2013, a two-day seminar on realty organised by CREDAI, he said the world over the housing market is an indicator of growth. But in India it does not get adequate incentives. Cost of approvals account for over 40 per cent of sales cost, he said.
N. Ram, Chairman, Kasturi and Sons, the publisher of The Hindu Group of publications, said real estate sector is an important part of national economic activity but is “under-estimated and sometimes demonised” due to misconceptions that it makes super profits. The media too tends to rush into judgement.
It is “fair enough” if the real estate sector complains when the news coverage is not fair and reliable. But the construction industry too should not be “over sensitive” as long as the media gets the facts right. He commended CREDAI for spelling out a code of conduct. If this is enforced to address customer needs a “tremendous job would have been done”, he said.
Transparency in project approvals and according of industry status to the real estate sector are crucial for sustained economic growth and job generation, according to T. Chitty Babu, Chairman, Southcon 2013.