Industry wishlist
Real Estate

Industry wishlist

Downward pressure on margins, availability of funds and slow moving order books – these summarise the performance of the construction and building sector in 2013. Going forward, faster execution of projects and seamless flow of funds into the sector hold the key to a positive outlook of this sector. The beginning of a new year with a new government at the centre to drive growth has triggered expectations from various industry players. From single window clearance to faster decision making process, the wishlist has no end. MONISHA RAO spoke with some industry leaders about their wishlist from the new government – an agenda not to be missed irrespective of the real impact of the forthcoming Union Budget.

REAL ESTATE

“The sector expects stable and progressive economic policies with speedy action, clarity of rules and ofcourse a corruption-free government. Policies towards large scale employment generation need to be taken forward rather than merely introducing socially populist schemes. The country needs huge investments in the industrial, infrastructure sector, which will lead to a tremendous cascading effect on other core sectors.  Simplification of applicable laws is an imperative in this sector given multiplicity of regulations and taxes by the Central, state and civic governments.”- MR Jaishankar, Chairman and Managing Director, Brigade Enterprises

“Easy access to funds and low interest rates on procuring capital is one of the vital demands of the real estate sector. In order to speed up the pace of projects, there is a need for a single window clearance scheme. The real estate sector has also been demanding for an industry status since a long time, as this can bring the sector at par with the infrastructure sector. Any initiative towards solving these issues can result in a favourable growth of this industry.”- Shailesh Puranik, Managing Director, Puranik Builders

“The real estate industry contributes approximately 6 per cent to the country’s GDP. The government must consider the fact that the sector generates employment across its various verticals and by granting it industry status, it will enable access to loans at lower interest rates and collateral values. As the sector is not under the umbrella of any specific regulatory authority, financing has been an issue over the recent years of credit slowdown. Hence, liberalisation of finance for the sector is required. It needs to increase the scope for external commercial borrowings and provide a general relaxation of financing norms.  Prices of construction materials need to be checked to optimise expenditure in the real estate sector. Moreover, if the government increases infrastructure spending in urban areas it will unlock the value of neglected and hidden land assets in sub-urban and peripheral districts. This will enable more holistic growth for the real estate markets in overburdened metros and help bring down the prices in the central areas.”- Harshavardhan Neotia, Chairman, Ambuja Neotia Group

CEMENT

“Companies are preparing themselves for an anticipated revival in demand ahead of the 2014 national election. They are also banking on interest rate cut by the Central Bank in June, which is likely to revive home sales and construction. With a firm government at the Centre, better current account deficit, balanced foreign fund inflows, encouraging global cues and better policy decisions are some of the wishes from 2014. The Government of India should initiate the Cement Concrete Roads project.  Although it is not an economically viable option, concrete cement roads promise permanency in comparison to bitumen roads and will help in reviving the sagging economy considerably.”- Vinita Singhania, Vice Chairman and Managing Director, JK Lakshmi Cement

“The three major sectors that require urgent support from the new government include roads, housing and infrastructure projects (power, ports, aviation). As far as the cement sector is concerned, the expectations are clearance of land for road building and promoting concrete roads  under PMGSY, NHAI and state highways. In the housing sector, consistent policy of banks/financial institutions for loan availability, strict regulation of timely delivery by builders, government housing boards and development authorities are of prime importance. Also, infrastructure projects, be it in the public or private sector face delay on account of ‘no single window clearance’ and are expected to knock doors of various Ministries or departments of mostly diversified views. Moreover, policies such as Mahatma Gandhi National Rural Employment Guarantee Act need to be looked in to provide the industry adequate labourers who are currently too dependent on government scheme. This has led to high labour cost.”- PK Dave, Chief Resident Executive, Cement Business Group, Century Textiles & Industries

CONTRACTORS

“The new government should primarily focus on infrastructure development and PPP infrastructural projects. This will ease the investment burden on the government. Long term planning with clear short term focus with clear funds planning will result in clear sailing rather than log jam in the middle. PPP and BOT or DBOT projects will optimise the expenditure as these are self sustained. These will certainly kick start the new growth phase. Involving regional governments in the drafting or planning stage of a policy without bias will help in getting the right projects for the state. Delegating and empowering state governments in the policy-making and funds utilisation or monitoring will help in removing the disparities which are prevailing currently.”- MK Sivabal, COO, RPP Infra Projects Ltd

“Issues in the infrastructure, irrigation, and agriculture sector needs to be given utmost importance. I am certain that the new government will address the prevalent issue and implement solutions. Policies pertaining to the Land Acquisition Bill will have a huge impact on the finances of the country. The government needs to discuss these issues with various state governments and formulate a way to go forward.”- Bollineni Seenaiah, Managing Director, BSCPL Infrastructure

CONSULTANTS


“The new government coming to power can take a number of initiatives to reform the building and construction sector. Some key policy proposals that are awaiting the government’s approval include the real estate regulation and implementation of a single window clearance mechanism for building approvals. The government can reduce the number of project delays that happen on account of the policy hurdles and regulatory bottlenecks. Effective implementation of a single window clearance mechanism as suggested by the SAPREP Committee constituted under the Ministry of Housing and Urban Poverty Alleviation will prove beneficial for the sector. This will not only reduce the cost incurred during project sanctioning but will also help in faster delivery of projects.”- Sachin Sandhir, Managing Director, RICS South Asia

“The government needs to focus on pushing the economy forward and bringing the GDP growth back to 9 per cent. Inflation too needs to be tamed, deficits need to reduce and the rate of interest should be brought down. Expediting the implementation of infrastructure projects will give a big boost to the economy. Funding within India needs to be optimally utilised while FDI should be encouraged with more transparency.”- Anshuman Magazine, Chairman & Managing Director, CBRE South Asia

“The real estate sector has been neglected by policy makers for long. However, this sector can move the economy and act as a growth engine to generate employment. Lack of transparency and inefficiency has barred the economic growth of the country.  Refining efficiency is the key. It will not only remove corruption but will also reduce cost to make housing affordable. Single window clearance and quick policy making schemes are required. Overall five reforms are required – land reform, administrative reform, tax reform, banking reform and fiscal policy reform.”- Lalit Kumar Jain, Chairman, CREDAI

STEEL

“One of the major expectations from the new government is to revive the economic growth as this is essential for the growth of the steel industry. We believe that strong performance by the manufacturing sector will have a ripple effect on the other sectors. All that the new government needs to do is to stick to the planned expenditure of spending $1 trillion on infrastructure. This will give a major boost not only to the economy but to the construction sector as well.”- Dilip Oommen, CEO & Managing Director, Essar Steel India

“The government should fast track infrastructure projects as the need of the hour. While this should fuel growth in the immediate term, there is no denying the fact that the government has to get its policies on track to grow the economy in the long run. A pro-industry and forward-looking outlook of the government is the single most important factor that can fuel India’s economic growth. This will not only positively impact the industry I belong to, but will have an impact on the economy as a whole.”- Radhika Markan, Managing Director, H&K Rolling Mill Engineers

EQUIPMENT

“The expectations from the new government are clear. The first existing bottleneck involves awarded road projects under BOT not taking off. It is clear that road projects under BOT will not find any takers in the near future due to factors like viability and finance. A political will to create world-class highways all over the country will be the key factor to future growth.”- Asit A Patel, Managing Director, Ammann Apollo India

“To tide over policy log jams, pending projects need to be cleared and funds need to be released. The ministry of environment, land acquisition and projects need to get their act together within defined time lines. Although the government prioritises and optimises expenditure for the building and construction sector, there has to be a long-term and short-term vision. Development of special industrial areas like SEZs, industrial hubs, etc, should also be distributed geographically and intelligently by offering special incentives and subsidies. The government needs to offer incentives on exports to improve the quality of products and manufacturing processes. This is a must for sustained growth of the industry.”- Rajinder Raina, General Manager-Business Development, Escorts

To share your wishlist with us, write in at feedback@ASAPPmedia.com

Downward pressure on margins, availability of funds and slow moving order books – these summarise the performance of the construction and building sector in 2013. Going forward, faster execution of projects and seamless flow of funds into the sector hold the key to a positive outlook of this sector. The beginning of a new year with a new government at the centre to drive growth has triggered expectations from various industry players. From single window clearance to faster decision making process, the wishlist has no end. MONISHA RAO spoke with some industry leaders about their wishlist from the new government – an agenda not to be missed irrespective of the real impact of the forthcoming Union Budget.REAL ESTATE“The sector expects stable and progressive economic policies with speedy action, clarity of rules and ofcourse a corruption-free government. Policies towards large scale employment generation need to be taken forward rather than merely introducing socially populist schemes. The country needs huge investments in the industrial, infrastructure sector, which will lead to a tremendous cascading effect on other core sectors.  Simplification of applicable laws is an imperative in this sector given multiplicity of regulations and taxes by the Central, state and civic governments.”- MR Jaishankar, Chairman and Managing Director, Brigade Enterprises“Easy access to funds and low interest rates on procuring capital is one of the vital demands of the real estate sector. In order to speed up the pace of projects, there is a need for a single window clearance scheme. The real estate sector has also been demanding for an industry status since a long time, as this can bring the sector at par with the infrastructure sector. Any initiative towards solving these issues can result in a favourable growth of this industry.”- Shailesh Puranik, Managing Director, Puranik Builders“The real estate industry contributes approximately 6 per cent to the country’s GDP. The government must consider the fact that the sector generates employment across its various verticals and by granting it industry status, it will enable access to loans at lower interest rates and collateral values. As the sector is not under the umbrella of any specific regulatory authority, financing has been an issue over the recent years of credit slowdown. Hence, liberalisation of finance for the sector is required. It needs to increase the scope for external commercial borrowings and provide a general relaxation of financing norms.  Prices of construction materials need to be checked to optimise expenditure in the real estate sector. Moreover, if the government increases infrastructure spending in urban areas it will unlock the value of neglected and hidden land assets in sub-urban and peripheral districts. This will enable more holistic growth for the real estate markets in overburdened metros and help bring down the prices in the central areas.”- Harshavardhan Neotia, Chairman, Ambuja Neotia GroupCEMENT“Companies are preparing themselves for an anticipated revival in demand ahead of the 2014 national election. They are also banking on interest rate cut by the Central Bank in June, which is likely to revive home sales and construction. With a firm government at the Centre, better current account deficit, balanced foreign fund inflows, encouraging global cues and better policy decisions are some of the wishes from 2014. The Government of India should initiate the Cement Concrete Roads project.  Although it is not an economically viable option, concrete cement roads promise permanency in comparison to bitumen roads and will help in reviving the sagging economy considerably.”- Vinita Singhania, Vice Chairman and Managing Director, JK Lakshmi Cement“The three major sectors that require urgent support from the new government include roads, housing and infrastructure projects (power, ports, aviation). As far as the cement sector is concerned, the expectations are clearance of land for road building and promoting concrete roads  under PMGSY, NHAI and state highways. In the housing sector, consistent policy of banks/financial institutions for loan availability, strict regulation of timely delivery by builders, government housing boards and development authorities are of prime importance. Also, infrastructure projects, be it in the public or private sector face delay on account of ‘no single window clearance’ and are expected to knock doors of various Ministries or departments of mostly diversified views. Moreover, policies such as Mahatma Gandhi National Rural Employment Guarantee Act need to be looked in to provide the industry adequate labourers who are currently too dependent on government scheme. This has led to high labour cost.”- PK Dave, Chief Resident Executive, Cement Business Group, Century Textiles & IndustriesCONTRACTORS“The new government should primarily focus on infrastructure development and PPP infrastructural projects. This will ease the investment burden on the government. Long term planning with clear short term focus with clear funds planning will result in clear sailing rather than log jam in the middle. PPP and BOT or DBOT projects will optimise the expenditure as these are self sustained. These will certainly kick start the new growth phase. Involving regional governments in the drafting or planning stage of a policy without bias will help in getting the right projects for the state. Delegating and empowering state governments in the policy-making and funds utilisation or monitoring will help in removing the disparities which are prevailing currently.”- MK Sivabal, COO, RPP Infra Projects Ltd“Issues in the infrastructure, irrigation, and agriculture sector needs to be given utmost importance. I am certain that the new government will address the prevalent issue and implement solutions. Policies pertaining to the Land Acquisition Bill will have a huge impact on the finances of the country. The government needs to discuss these issues with various state governments and formulate a way to go forward.”- Bollineni Seenaiah, Managing Director, BSCPL InfrastructureCONSULTANTS“The new government coming to power can take a number of initiatives to reform the building and construction sector. Some key policy proposals that are awaiting the government’s approval include the real estate regulation and implementation of a single window clearance mechanism for building approvals. The government can reduce the number of project delays that happen on account of the policy hurdles and regulatory bottlenecks. Effective implementation of a single window clearance mechanism as suggested by the SAPREP Committee constituted under the Ministry of Housing and Urban Poverty Alleviation will prove beneficial for the sector. This will not only reduce the cost incurred during project sanctioning but will also help in faster delivery of projects.”- Sachin Sandhir, Managing Director, RICS South Asia“The government needs to focus on pushing the economy forward and bringing the GDP growth back to 9 per cent. Inflation too needs to be tamed, deficits need to reduce and the rate of interest should be brought down. Expediting the implementation of infrastructure projects will give a big boost to the economy. Funding within India needs to be optimally utilised while FDI should be encouraged with more transparency.”- Anshuman Magazine, Chairman & Managing Director, CBRE South Asia“The real estate sector has been neglected by policy makers for long. However, this sector can move the economy and act as a growth engine to generate employment. Lack of transparency and inefficiency has barred the economic growth of the country.  Refining efficiency is the key. It will not only remove corruption but will also reduce cost to make housing affordable. Single window clearance and quick policy making schemes are required. Overall five reforms are required – land reform, administrative reform, tax reform, banking reform and fiscal policy reform.”- Lalit Kumar Jain, Chairman, CREDAISTEEL“One of the major expectations from the new government is to revive the economic growth as this is essential for the growth of the steel industry. We believe that strong performance by the manufacturing sector will have a ripple effect on the other sectors. All that the new government needs to do is to stick to the planned expenditure of spending $1 trillion on infrastructure. This will give a major boost not only to the economy but to the construction sector as well.”- Dilip Oommen, CEO & Managing Director, Essar Steel India“The government should fast track infrastructure projects as the need of the hour. While this should fuel growth in the immediate term, there is no denying the fact that the government has to get its policies on track to grow the economy in the long run. A pro-industry and forward-looking outlook of the government is the single most important factor that can fuel India’s economic growth. This will not only positively impact the industry I belong to, but will have an impact on the economy as a whole.”- Radhika Markan, Managing Director, H&K Rolling Mill EngineersEQUIPMENT“The expectations from the new government are clear. The first existing bottleneck involves awarded road projects under BOT not taking off. It is clear that road projects under BOT will not find any takers in the near future due to factors like viability and finance. A political will to create world-class highways all over the country will be the key factor to future growth.”- Asit A Patel, Managing Director, Ammann Apollo India“To tide over policy log jams, pending projects need to be cleared and funds need to be released. The ministry of environment, land acquisition and projects need to get their act together within defined time lines. Although the government prioritises and optimises expenditure for the building and construction sector, there has to be a long-term and short-term vision. Development of special industrial areas like SEZs, industrial hubs, etc, should also be distributed geographically and intelligently by offering special incentives and subsidies. The government needs to offer incentives on exports to improve the quality of products and manufacturing processes. This is a must for sustained growth of the industry.”- Rajinder Raina, General Manager-Business Development, Escorts To share your wishlist with us, write in at feedback@ASAPPmedia.com

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