Real Estate: An emerging industry for FDI in India

The government has undertaken a number of policies to ensure that the country remains the most attractive investment destination in the world. According to the country’s annual report card, FDI equity inflows to the services sector grew by 15% during 2017-18 (April-October). Mr. Anil Sinha, Global Impact Investing Network's (GIIN’s) advisor for South Asia has stated that Indian impact investments may grow 25% annually to US$ 40 billion from US$ 4 billion by 2025

During April 2017-December 2017, FDI inflows in Construction (Infrastructure) Sector is $ 2540 million and we talk in the percentage term, the increase is 36.48% as compared with the FY 2016-2017

FDI in the real estate sector is estimated to grow to USD 25 billion by FY22. By 2028, India’s real estate market size is expected to reach USD 853 billion, increasing from USD 126 billion in 2015

FDI in the real estate sector and it will receive a significant boost in foreign investments. The recent announcement of the government’s decision to offer 100% FDI via automatic route will give a required impetus to the real estate broking services India real estate broking services India and it will receive a significant boost in foreign investments.

Advantages of the FDI policy in the real estate sector Introduced by RBI, here are a few advantages of the FDI policy which is as follows–

Transparency: Growing competition would lead to better efficiencies and innovations in the sector. This will allow transparency, the reduced timeline of projects; build trust, and offers better experience in buying a house, property or land.

India as Investment Destination: Those foreign companies who are looking for geographic expansion in their brokerage services will see India as a new investment destination.

NRI investments: India will improve the scope and possibilities of NRI investors in the real estate market of India.

When the sector becomes more and more organized, the small and local brokers may not be able to scale up their services and eventually fade out from the system. There would also be a lot of consolidation in the market with the small players joining hands with the more established ones. However, there would still be a lot of gaps left in brokerage service sector which can be capitalized by the new players.

Well, the World Bank has stated that private investments in India is expected to grow by 8.8 percent in FY 2018-19 to overtake private consumption growth of 7.4 percent, and therefore drive the growth in India's gross domestic product (GDP) in FY 2018-19. Policies are made so that it can improve the overall health of the business considering the requirements of all stakeholders and 100% FDI under the automatic route is one such move taken by the Government which will not only bring clean money into the system, but it will also pave the way for the entry of some of the foreign investments into the Indian real estate sector.

Digital Marketing Manager at clicbrics, Real Estate enthusiast, Property Advisor and blogger