New Delhi: In order to discuss a roadmap for making infrastructure and the real-estate sector grow to achieve a target of becoming Rs 100 lakh crore worth industry, domain experts gathered at the Building India Conclave held by the NewsX and The Sunday Guardian on Friday in Delhi.
Speaking about the challenges and roadblocks in achieving Rs 100 lakh crore infra investment in five years as was said by Prime Minister Narendra Modi, Sameer Jain, Partner, KMPG-Infrastructure portfolio, said: “We must focus on the enabling factors needed for making Rs 100 lakh crore infrastructure and real estate sector. There are some roadblocks which need to be fixed and for that we must consider expert committee reports like the Kelkar Committee had suggested distinguishing between the circle rate and market rate. The incumbent Central government has done a lot to help the sector to achieve the desired goal, but there is a need to do more.”
The Prime Minister had made the announcement of Rs 100 lakh crore infra investment in five years at his Independence Day speech this year, setting the tone for policy direction (including faster approvals and possibly single-window clearance).
Speaking on the issue, Bharat Joshi of ACLT said: “We have to understand that the PPP model is one of the good examples which can help in building infrastructure in the country, but roadblocks like land acquisitions, and lack of long-term strategies need to be removed.”
Industry experts and economists also stressed on the need for infrastructure development which can further lead to the development of the real estate sector.
Sharad Kohli, a noted economist, said: “In order to explain the enabler to make the real-estate sector grow, I would focus on the micro-level. With the given fiscal deficit and gloomy economic environment making the infrastructure sector grow to $1.5 trillion would be a stretched expectation. We want to make 100 smart cities, but we have only 4% highways having four lanes; so we must need to address all these issues.”
In the same session, Vinit Goenka, Member Governing Council CRISS, Ministry of Railway said: “Infrastructure development and investment will enable this sector to become Rs 100 lakh crore worth industry. He gave eye-opening details of the projects that have been implemented. He stressed that technology can help in achieving the growth.”
Nasir, another expert, focused on the issue of funding for the sector. He said: “NBFC has failed to provide the required fund for the sector and in this situation, the Real-Estate Investment Trust (REIT) which was coined by the BJP-led Centre, can help in achieving the expectation from this sector.”
The jam-packed session of Building India conclave also discussed restoring real-estate to achieve faster growth. Expressing his views, Rajeev Talwar, CEO, DLF, said: “The Central government has done a lot of good work including the creation of REIT, but the NPA problem and failure of NBFCs in funding have led to fund crunch for the sector. With the change in scenario, we need to pay attention to new areas like rental housing schemes. Also, there are several roadblocks that were created by the implementation of GST. For example, a developer cannot claim input credit unless his project is ready and you know that completion of a project takes at least four years.”
At the conclave, Smir Jasuja of PropEquity stressed the need for instilling trust in the developer. “About nine lakh projects are to be delivered by 2020, but for the completion of these projects the fund inflow is much required.”
The discussion also became interesting with R.C. Sharma, Registrar of RERA, Rajasthan, giving insight into how RERA has helped in instilling confidence in buyers as well as developers. He gave an insightful view on how developers are also facing problems due to the policy of RERA.
“Currently, to build a project, developers are given a period of five years including one-year extension to complete a project, but take the case of NCR where the NGT extends a ban on the construction work every year for some months. The construction ban halts builders’ work for at least one year and that is a big loss for developers.”
Mohammad Athar, Partner, PwC, said: “We have a huge pile-up of non-performing assets that need to be dealt carefully and swiftly. Also, we need to focus on new areas like rental housing schemes.”
Another domain expert, Kishore Desai, director NIIF, said: “The Government of India has pumped Rs 25,000 crore; therefore, the problem is not the lack of money, but our mindset needs to change.”
The Building India conclave became more interactive with the conversation round on how to re-build India. The gathering witnessed two prominent speakers at the stage—Pradeep Aggarwal, CMD, Signature Global, and Varun Pawa, MD Pawa Group.
“Lakhs of people from the rural areas of the country come to the city and dream of owning a house. The dream of owning a house becomes the primary thing for them. What we at Signature Global do is just to ensure affordable housing for this section. Only affordable housing can help these populations in meeting their dream,” Pradeep Aggarwal said.
Aggarwal said that RERA has restored confidence in buyers as well as developers. “We need to redesign houses as per demands coming in and it should meet the criterion of an affordable house. Although affordable housing is a subjective thing, it should fulfill the requirement of a prospective buyer. We have launched a project in Gurgaon that is in this segment and the response is overwhelming.”
While speaking at the event, Varun Pawa said: “With its rising population, India has great potential in the infrastructure and real-estate sector. The demand is slowly rising and with the government stepping in to ensure the smooth flow of work, the sector will soon see a boom.”
Later in the evening session, the focus shifted on building of a smart city. during a panel discussion on “Building Smart City Future”, the key policymakers of various agencies stressed on proper coordination between different state governments and agencies for the execution of key projects. In the context of developing Delhi into a smart city, they said that concerted efforts were needed to expand the population outside the city to neighbouring states like UP and Haryana.
The Building India conclave in its late session witnessed a smart discussion on building of smart cities. The session preceded further with Ashwani Lohani, Chairman cum Managing Director (CMD)’s optimistic view on the revival of Air India.
By the end of the day, the NewsX and The Sunday Guardian Conclave reached its peak where Hardeep Singh Puri, Union Minister of Housing and Urban Affairs, presented slides of the work done by his ministry and the Centre.
The conclave ended with a short felicitation programme. Puri presented mementos to Luminex’s Pankaj Malhotra for best exterior decoration, Pradeep Aggarwal of Signature Building and Ajnara India Ltd for best projects in Ghaziabad, beside others.