Budget Expectation by Mr. Nitesh Kumar, COO, TDI Infracorp (for interim budget 2014-15)

Real Estate Sector is the second largest employment generator after agriculture in India and it is also contributing almost 8% to our GDP. In this interim budget, we can’t expect much but the real estate sector is granted industry status. Introduction of Real Estate Regulatory Bill and Land Acquisition Bill in the parliament are good steps but we hope that some rational approach is taken to provide equal opportunity for all stake holders before making the law. Liberalization of finance for the real estate sector would be a big booster as financing has been an important issue over years of credit slowdown. The budget should also pay attention on external commercial borrowings for real estate and provide a general relaxation in the financing norms.

 

Higher interest rates of funding is a major setback for the sector and therefore  the government should introduce provisions in the budget to provide some policy incentives to reduce the base rate through Reserve Bank to help banks lower their lending rates. Government should also provide some incentive to low income and middle income group to help them acquire houses for themselves. It is also important to reduce the tax rate on long term capital gains on transfer of house property. Income tax benefit should be given to the buyers directly as a tax break from their personal taxes to encourage and promote purchase of housing up to Rs 75 lakh in NCR and Rs 50 lakh in tear-II cities.