The Indian economy experienced 8.6% growth in 2003. The growth momentum since then has been sustained at 6-7% GDP in spite of insufficient monsoons, reduced growth in agriculture and increasing global steel and oil prices. This is because Indian economy has shifted its base from agriculture to services. The key drivers in this context have been IT and ITES industries. A boom has been felt in certain sectors of Indian economy especially in the real estate development over the last 5 years. FDI in Real Estate India The real estate sector in India opened only in February 2005 and ever since then the flow has been a whopping 100%. Foreign direct investment has been felt today in some of the major townships, housing, built-up infrastructure, commercial premises, hotels, resorts, hospitals, educational institutions, recreational facilities, city and regional level infrastructure. Thanks to the Governments open FDI policies! FDI in Real Estate India-the first success The Foreign Investment Promotion Board initially allowed FDI only in integrated townships. In this regard FIPB first approved a 100-acre residential township in Gurgaon. An Indian infrastructure and property consultancy company, Feedback Ventures Ltd tied up with Malaysia based real estate companies, Kontur Bintang and Westport, for the project costing Rs.800 crore. Indian in the rapid globalization market of real estate development-key players The global investment in real estate has increased from 12% in 2003 to $457 billion in 2004. Foreign investment picked up real fast in the Indian realty sector. Today service providers such as Jones Lang LaSalle are constantly positioning to leverage themselves to an increasing number of real estate players who are now operating globally. Morgan Stanley headquartered in New York, USA has invested $68 million in a local property developer of India (Bangalore-based Mantri Developers Private Ltd) 2006 started with a promising note as Dubai-based Emmar Properties-the largest listed real estate developer in the world joined hands with Delhi-based MGF Developments to announce Indias largest FDI in realty sector. The investment amounts to $500 million in projects with a capital outlay of $4 billion. Various groups which showed interest in the insurance sector in this context are American International group (AIG), High Point Rendel of UK, Edaw-US, Japans Kikken Sekkel, Lee Kim tah holdings and Cesma International from Singapore. The boom in the real estate India is attracting interests of other global players like Vancouver-based Royal Indian Raj International Corporation ready to invest $2.9 billion in a single real-estate project in Bangalore over a period of 10 years. Conclusion Real estate India can expect a 20% growth in the organized retail scene all across the major metros of the country. Mumbai, Bangalore, New Delhi, Hyderabad and pune would have 250 malls by 2010 as against 40 now. Lets see India real estate growing in leaps and bounds. Just remember any investment in real estate now is bound to be profitable! |
