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Economic Survey 2018: Real estate sector shows signs of improvement, receives FDI of $257m in first half of 2017

PE funds invest US$5 billion in real estate sector: Economic Survey

January 29, 2018 / 17:17 IST
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The strength of the Indian economy and favorable demographics, coupled with the introduction of several growth oriented reforms are aiding real estate sector to attract higher investments. Indian Real Estate sector has begun to show signs of improvement with the total FDI of USD 257 million in the first half of 2017, which is more than double the total FDI in 2016 full year, says the Economic Survey presented to both houses of Parliament during the Budget Session on Monday.

This positive sentiment was attributed to a host of factors including regulatory environment, enhanced infrastructure, and amendments to Real Estate Investment Trusts (REITs). These policy initiatives are expected to lead to higher transparency, accountability and make the sector better organised and structured, thereby increasing the investment, notes the Economic Survey.

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Private equity investments in the real estate sector have also increased from US$ 0.9 billion in 2013 to over US$ 5.9 billion in 2016, recording more than six-fold jump during this period, it says.

Indian real estate has attracted institutional investments (excluding bank credit to commercial real estate) of over US$ 10.7 billion, since the beginning of 2016, which is more than half of the total investments witnessed since 2013.