Of late, Indians have started investing in properties in Sri Lanka as well. “There is considerable interest from Indian investors and second-home buyers, with the demand being more or less balanced between these two segments,” says Gagan Singh,
CEO-business (India) and chairperson, JLL’s Sri Lanka operations. She adds that there is considerable interest from buyers in Tamil Nadu and Bangalore, particularly in homes along Sri Lanka’s coast and also in multi-storey apartments in Colombo.
However, there are some limitations to Indians investing in property in Sri Lanka. Like all other foreigners, they have to come up with 100% of the property cost and cannot avail of loans for this purpose. Also, in the case of multi-storey flats, they cannot buy a property below the fourth floor. Land investors typically adopt the leasing option, as outright purchase is very complicated.
Despite that, the Sri Lankan market, besides the Maldives, seems to be an attractive one for Indians. Additionally, Indian developers such as Tata Housing and Kalpataru are active with projects in Sri Lanka and the Maldives, catering not only to local demand, but also beginning to focus on Indian buyers.
Tata Housing in September signed a revised agreement with the Maldives government to complete a housing project in Male being developed at an investment of about R1,000 crore. It is understood that this pact will pave the way for the resumption of construction work on the project that has been on hold for two years due to issues over terms and conditions of the contract.
In 2010, Tata group’s realty firm, Tata Housing, had signed an agreement with the then Maldives government to develop the housing project at four different sites in that country. “We are positive that this will significantly contribute towards building strong bilateral relations between India and the Maldives, thereby encouraging other companies in India to enter into similar JVs,” says Tata Housing MD and CEO Brotin Banerjee.
Tata Housing also plans to expand its international footprint to other Saarc nations and Africa.