Delhi/NCR
The real estate sector should be given infrastructure status along with other tax benefits, so that it attracts investments and construction activities increase, Credai (The Confederation of Real Estate Developers Associations of India) said.
At present, despite the fact that the sector is the second largest employer after agriculture, in the unorganized sector, it does not enjoy any status and, consequently, banks are reluctant to give loans to developers for construction activities.
Because of this, unless a developer sells at least 70% of a project, they cannot start construction, which leads to delay in the completion of projects.
Getamber Anand, national president of Credai, said, "Development of an integrated township and group-housing development on more than 10 acres should be given infrastructure status." Anand says that any project involving a provision for construction of roads, water-supply system, water-treatment plant, sanitation, and sewerage systems and solid waste treatment and management systems should be treated as an infrastructure project by the government for all purposes.
To incentivize housing development, infrastructure activities should be included in Section 80IA of the Income Tax Act, which would make the profit from these activities tax free.
After purchasing agricultural land, these companies create most of the infrastructural facilities and only then does the raw land gets converted into developed land, fit for construction of buildings for residential and commercial purposes.
Parveen Jain, president of Naredco (National Real Estate Development Council), said: "The denial of industry status for funding purposes to the real estate sector has created a huge problem. The situation has worsened in the present situation of financial crunch and slowdown in demand."
Source - Times Property, The Times of India, Delhi/NCR
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