MUMBAI: Raising serious concerns on continuous weakening of rupee against dollar, real estate body NAREDCO today appealed to developers to cut down imports of building construction material and instead use domestically manufactured product.
"Developers import nearly USD 10 billion worth building construction products and services every year for their projects. In a situation when rupee is constantly depreciating, there is an urgent need that developers consider using made in India materials," National Real Estate Development Council (NAREDCO) vice president Sunil Mantri told reporters here.
The imports not only include products like flooring, cement, home automation but also services like technology, consultancy and architects for which payments are made in dollars, he said.
"We import these services especially for developing high-end luxury projects. Such imports account to nearly 30-50 per cent of the total cost of the project," he said.
Mantri said if developers adopted these measures it will help in making rupee stronger.
On the Real Estate Regulation and Development Bill, NAREDCO president Navin Raheja said it should be more practical and looking at the growth of the industry.
"The Bill is a hugely positive step in the direction of developing the industry. However, this Bill addresses issues in a limited way.
"While the industry welcomes the positive intent of the government, we believe that the momentum gained should be utilised to iron out some of the issues. This will not only help to unlock projects worth over Rs 10,000 crore, it will also catalyse the economy with more vigour and vibrancy," he added.
On FDI in the sector, Mantri said, the government has allowed foreign investment into projects having area over 50,000 sq metre, which should be reduced to 20,000 sq metre so that even small developers can get the benefit from it.
"Already the financial conditions of developers is weak and to add to their woe banks are not ready to fund projects due to various issues like clearances and approvals.
"In this situation the only way of raising funds is through private equity. If the area limit is reduced even small developers will be able to get foreign investment," he added.