Ms. Manju Yagnik, Vice Chairperson, Nahar Group - One of Mumbai's leading real estate companies provides her perspective on the upcoming budget .
Q:What are the key necessities that you feel are must for the revival of economic growth?
A: Improving fiscal health, containing of inflation while ensuring inclusive growth are the basic necessities I feel that are must for the revival of economic growth. The government has been making all round efforts to address these basic challenges and it has succeeded to some extent.
Apart from the key policy decisions by the RBI, faster regulatory clearances, policy framework for hassle free land acquisition should enhance business confidence levels in the real estate circles leading to increased investment and thereby reviving growth. RBI could play a major role in revival of the economic growth. With the recent cut in repo rate and CRR has indicated a clear shift in the stance of the central bank to a soft money regime. We are optimistic about the likely change in the investment climate in the country. The real estate contributes lion’s share in the country’s GDP. Providing relief to the sector may boost the overall economy Various estimates are suggesting that the GDP growth will be above 5 per cent in the current fiscal year. We are expecting bold policy measures to boost the economy from the forthcoming union budget.
Q:What are your predictions on what the Budget is likely to deliver?
A:There are already positive indications that the upcoming budget may be a populist one and we tend to agree with it. As usual there is euphoria ahead of the budget, but I believe the finance minister may pitch for strong policy measures to take up reforms further while rationalizing taxes for the salaried class increasing the demand for realty projects. The budget may be a balanced policy statement this year, taking cognizance of common man, corporate sector and development.
Q:What do you feel optimistic about, in the current situation?
A: Government’s clear intention and confidence about continuation of financial reforms, serious efforts towards rationalization of tax system, steps towards cutting down the subsidies are the few things that make us optimistic about the current situation. By taking decision about FDI in retail in the recent past, the government has already indicated that there is no question of going back from the reforms.
Q: What are the biggest challenges that you think are holding back corporate expanding?
A: I feel it’s the bottleneck in the approval processes, lack of data coordination among various authorities that the corporate expansion plans are resisted. However, the budget might hopefully reduce the regulatory compliance for corporate and facilitate investments to drive growth.
Q:What are your expectations from this budget?
A: The Real Estate Industry is second largest contributor to the country’s GDP after considering the lull in the real estate market since the last few months and its gradual attempt to make a comeback, the expectations from the upcoming budget for the real estate industry is high. We hence await the infrastructure status to the industry that will automatically accord priority status from the RBI to the real estate projects. Considering the shortage of working capital faced by the developers, we also expect the budget to smoothen FDI inflows. In order to meet the demand for additional homes, there is an urgent need to speed up the approval process. We expect the government to come out with the single window clearance system for approving projects.To match the increasing residential development taking place in tier I and tier II cities, there is a need to improve the infrastructure base in these cities. Additional funding assistance to the prime cities for infrastructure and for the real estate industry to meet the shortage of working capital is expected from this budget. All these measures will help the real estate industry in India to supply additional stock of homes at reasonable rates that can be affordable for the modern man.