Given the deep impact of the financial turmoil on western economies, India’s share in the global economy is like to grow in a significant way. By 2020, India will become the third largest construction market in the world, from the current ninth position, as per a 10 year forecast from Oxford Economics and Global Construction Perspectives.
As history has time and again portrayed how the path of the real estate industry is intertwined with all the major economic and political decisions in India, Unesta looks into what the Indian Government has planned in the future. In 2000, the Planning Commission constituted a committee on Vision 2020 for crystallising the country’s vision for the future. It focussed on 5 main areas including Agriculture and Food Processing, Infrastructure with Reliable Electric Power, Education and Healthcare, Information and Communication Technologies and growth of strategic industries.
Out of the main areas identified, the focus from India Real Estate perspective will be majorly on:
• GROWTH DRIVERS: India’s unique dynamic profile with young population and high saving culture along with rapid urbanisation will continue to be the drivers of growth of the real estate industry.
• TECHNOLOGY: Adoption of state of art construction technology and using international standards in construction shall be an important objective as steps are already being taken in this particular direction. However there is a bigger challenge of infrastructure and urban planning as both need to happen in unison for uniform development. And last but not the least is the green building technology. Developers are readjusting their visions to see integration of sustainable technology as an investment for future and not just as a cost.
• FINANCE & ECONOMICS: With changes in economic policies with respect to Foreign Direct Investment, India is all set to witness a new wave of reforms. One will observe its direct and indirect effect on real estate values and pace of growth. India is also slowly and steadily warming up to the principle of Real Estate Investment Trusts (REITs) and Real Estate Mutual Funds (REMFs). These shall surely propel the sector to the next level. With more and more projects falling under Public Private Partnerships, India is looking at a robust solution to its infrastructural needs.
• GOVERNANCE: Good governance policies which are simple and straight forward are now replacing the age old complex frameworks. Data for analysis is scarce however measures are being taken in this direction for documenting the past and future transactions. The transparency index for India is improving and is only expected to grow. Measure such as Right to Information and Service tax in EDC are just the beginning of many such efforts.
India is amongst the top 5 nations of the world in terms of GDP. With a vision identified and a purpose to face the current challenges, the Indian Government is taking steps to shape a better future.
As the Ex-President of India, Dr. A.P.J. Abdul Kalam sums it up “Vision 2020 is not a prediction but our belief in what can be achieved through mobilising the human, technological and financial resources to double the growth rate of GDP and transforming the nation into a developed country.”
Unesta proposes every Non Resident Indian to be a part of the vision of a developed India.