New norms will also help inflow of cash from foreign investors for completion of projects
Government's move to ease FDI norms in construction sector could give the much needed push for the Hyderabad real estate sector
Hyderabad: The government’s move to ease FDI norms in construction sector could give the much needed push for the Hyderabad real estate sector, say industry leaders. R. Chalapathi Rao, vice-president of NAREDCO and TREDA, says, “Most of the developers in this region work in the floor area of 20,000 sq metre. Thus, the government slashing the minimum floor area requirement from 50,000 sq metre to 20,000 sq metre will make them eligible for foreign investment inturn giving a boost to their projects.”
Earlier, only 10 builders in Hyderabad used to fall in the upper category.“With the slashing of minimum area, around 100 medium builders constructing in the 20,000 sq metre floor area will be eligible for FDI,” said M. Jaiveer Reddy, MD, Ashoka Developers.The move is expected to bring relief to the realty sector in Hyderabad, which has seen projects shutting down. However, Mr Reddy says that the number is very small in context to a large city like Hyderabad which has around 2,000 builders each having 15-20 apartments totaling to 40,000 apartments.”
The new norms also bring in good news for consumers whose investments were stuck in such projects as inflow of cash from foreign investors will help in completion of such projects. The state government too had earlier announced initiatives to boost the sector.“As per the GO dated October 17, a developer constructing a building above five floors can pay the city level impact fee in six installments in three years. This is a big relief for the builders as they can pay the fee as and when they sell flats,” said Mr Reddy.
( Source : dc correspondent )
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