Government policies to drive Realty Sector



The government has implemented several policies to support the real estate sector. However, a number of growth promoting regulatory developments and initiatives announced over the last two years are helping to revive the sector and is expected to pave the way for strong sector growth in the future which contributes heavily to employment generation and the GDP of the country.

As per the report- the country’s residential and non-residential buildings sector to expand by 6.6 per cent, in real terms, next year, driven by fiscal support and a continued focus on the provision of affordable housing in urban areas. There are policies like –

  • The government “approved a Rs 10,000 crore package in November 2019 which was aim to aid stalled housing projects, with an additional Rs 15,000 crore to be contributed by state-run financial institutions.”

  • It expects a portion of stalled housing projects to resume construction, and this will feed into its forecasts for India’s buildings sector growth in the short term.

  • Opportunities in the construction of affordable housing units will remain strong over the coming years, driven by Modi’s Pradhan Mantri Awas Yojana (Urban) initiative which was introduced back in 2015, to provide affordable housing to all urban poor by 2022, targeting more than 4,000 towns handpicked by the government.

  • To provide financial support to homebuyers, various complementary schemes, such as the credit-linked subsidy scheme, were introduced alongside Pradhan Mantri Awas Yojana.

Adding on, PMAY(U)-related construction is expected to carry on beyond 2022, contributing to growth of the residential buildings sector in the short to medium term which is expected to boost growth of the residential buildings sector, we believe the government is unlikely to achieve its goal within the stated time frame due to the continued growth of India’s urban population, that creates a greater demand for affordable housing, as well as delays in land acquisition and construction

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