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Top 10 government initiatives to augment Indian real estate development

The government has taken many policy initiatives to boost the real estate sector in India. Prominent among these initiatives are given as under:

  1. Foreign Direct Investment (FDI) up to 100% has been permitted with government permission for developing townships and settlements.
  2. Investment by only NRI (non-resident Indians) and POI (persons of Indian Origin) in housing and real estate criteria has been abolished.
  3. Regulations allowing only integrated township through wholly owned subsidiary or through a joint venture company with an Indian partner have been abolished.
  4. Minimum area for the development of an integrated township has been brought down from 100 acres to 25 acres.
  5. The government has allowed External Commercial Borrowing (ECB) for low cost housing, roads and construction with a reduction in withholding tax on ECB interest.
  6. The government has introduced subvention scheme of 1% on housing loans up to Rs 15 lakhs when the cost of the house does not exceed Rs 25 lakhs.
  7. Now the government has proposed to allow 100% FDI in single brand retail, on the condition that the single brand retailer source 30% of its goods from India.
  8. Now the government has proposed to allow 51% FDI in multi-brand retail with a minimum investment of $100 million and a mandatory 50% capital reinvestment in back-end operations.
  9. The government has simplified the procedures to get Special Economic Zones (SEZ) notified.
  10. The government has also introduced IT policies where additional floor area ratio (FAR) has been given to developers to construct more for IT purposes.
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