Maharashtra, UP, Gujarat saw significant investments in real estate

There are about 3,489 projects worth Rs 14.5 lakh crore in the real estate sector that are currently live across India, said study

GN Bureau | May 10, 2017


#Maharashtra   #UP   #Gujarat   #Real Estate   #Real Estate Bill   #Real Estate Act  
Representational image (GN Photo)
Representational image (GN Photo)

Maharashtra, Uttar Pradesh and Gujarat together account for over half of the total investments attracted by real estate and construction sector in India as of December 2016, noted a study by ASSOCHAM.

“There are about 3,489 projects worth Rs 14.5 lakh crore in the construction and real estate sector that are currently live across India,” according to the study titled ‘Construction and real estate investment: State-level analysis’.

While Maharashtra alone accounts for lion’s share of about 25 per cent in total investments attracted by real estate and construction industry in India as of December 2016 followed by UP (13 percent), Gujarat (13 percent), Karnataka (10 percent) and Haryana (nine percent).

“The centre and state governments must introduce a single-window clearance system at the earliest to avoid time and cost overruns that are impacting the growth and development of real estate sector in India,” DS Rawat, national secretary general of ASSOCHAM.

“Government should also grant industry status to the sector to counter the apathy of banks in financing realty projects. As for the sector, the companies in the real estate space must keep looking for long-term financial resources to become independent,” he said.

The study prepared by ASSOCHAM Economic Research Bureau (AERB) highlighted that almost 90 percent of construction and real estate investments are concentrated in top 10 states.

So far as the investment growth trend in this sector is concerned, the sector touched highest rate of 13.5 percent in 2010 but recorded sharp downfall till 2013 whereby it recorded negative growth of about eight percent but it picked up in 2014 to reach about three percent and again fell to (-) 2 percent in 2015.

However, the real estate and construction investments recorded a positive growth rate of 2.5 percent in 2016 as such the sector clocked compounded annual growth rate (CAGR) of (-) 0.7 percent between 2011-16.

Among states, Odisha has recorded highest CAGR of about 37 percent in investments attracted by realty sector during 2011-16 followed by UP (nine percent), Maharashtra (three percent), Kerala (1.6 percent) and Andhra Pradesh (1.4 percent) while rest all top states clocked negative growth in this regard.

It is worrisome to note that 70 percent of construction and real estate investment projects remained non-starter in India since 2013.

Secondly, significant growth has also been recorded in projects that remained under different stages of implementation i.e. from 63 percent in 2009 to about 77 percent in 2015 which moderated to 72 percent in 2016.

Among states, over 95 percent of realty investment projects are under implementation in West Bengal followed by UP (90 percent) and Punjab (88 percent).

High under-implementation rate leads to time and cost overruns. As such of over 2,300 construction and real estate projects that are under-implementation, 886 projects are facing an average delay of 39 months and about 93 percent of these projects are in the housing sector while rest are commercial complex.

More than 95 percent of delayed 886 projects i.e. 845 projects are accruing to private sector ownership while public sector ownership has only 41 such projects.

Real estate projects in Punjab are facing maximum delays to the tune of 48 months followed by Telangana (45 months), West Bengal, Odisha and Haryana (44 months).

On a positive note, while the new investment activities in real estate and construction sector have recorded negative growth between 2011 and 2015, it recorded a significant spike in 2016 (32 percent).
 

Comments

 

Other News

“If the oppn is weak you can’t blame the govt for that”

A three-term Rajya Sabha member, Sanjay Raut is the Shiv Sena spokesperson and its voice in parliament. He is also the executive editor of Marathi newspaper Samana, started by Shiv Sena founder Bal Thackeray. Raut spoke with Geetanjali Minhas on his party’s seat-sharing agreement

Ashish Shelar of BJP says, “We are very confident of victory”

Ashish Shelar, 47, was the president of the Mumbai city unit of the BJP, before he became the minister of school education, sports and youth welfare in the Maharashta government this year. He has represented the Vandre West constituency in the state assembly and seeking re-election. In a chat with

Nobel for economics goes to `global fight against poverty`

The Nobel Prize in economics for 2019 goes to Abhijit Banerjee, Esther Duflo and Michael Kremer "for their experimental approach to alleviating global poverty." The prize, known as “The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel”, was announc

Modi-Xi script a new chapter in bilateral relations

Prime minister Narendra Modi has accepted president Xi Jinping’s invitation to visit China in 2020 for their third informal summit after Wuhan and Mamallapuram, indicating both sides’ realization of the importance of the mechanism which gives the two leaders of the Asian giants an opportunity t

Dharma as the original Idea of India

Dharma: Hinduism and Religions in India By Chaturvedi Badrinath Edited by Tulsi Badrinath Penguin, 194+ xiii pages, Rs 499 How to live: That is the most fundamental question of human existence.

Prakash Ambedkar on why he wants other parties to mention the candidates’ community

Prakash Ambedkar, grandson of Dr BR Ambedkar and popularly known as Balasaheb Ambedkar, heads the Vanchit Bahujan Aghadi (VBA). The three-time MP founded this new political party last year with a vision of Ambedkarism, secularism, socialism and progressivism. The VBA, registered this year before the Lo



Current Issue

Current Issue

Video

CM Nitish’s convoy attacked in Buxar

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter