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New FDI Norms to Boost Affordable Housing Segment: Industry


New Delhi: India’s real estate industry on Tuesday hailed the government’s decision to relax foreign direct investment (FDI) norms for the construction sector saying the move would boost foreign investment into the sector, particularly affordable segment.

The government on Tuesday relaxed FDI norms in the construction sector by removing two major conditions related to minimum built-up area as well as capital requirement. This means that any project regardless of size which is under construction can have access to FDI.

It also eased the rules for foreign investors to exit and repatriate their investments.

“This is a very good decision. We expect that a lot of money will flow into the construction sector which will boost the overall economy and provide jobs,” Getamber Anand of realtors’ apex body CREDAI told PTI.

When contacted, DLF CEO Rajeev Talwar said that this will be a “game changer” for the real estate sector and improve liquidity of developers.

“This is a very good package of economic reform which will give huge boost to growth and employment,” he said.

Property consultant JLL India’s chairman and country head, Anuj Puri, said: “The government has really liberalised the FDI rules for construction sector. This will bring a lot more excitement and interest from foreign equity players to invest into real estate for development of residential and commercial buildings.”

The removal of restriction on minimum development area will not only boost affordable housing but inner-city development, he added.

CREDAI’s president sought more clarity on the requirement of completion of trunk infrastructure for foreign investors to exit from their investments. He demanded that exit should be allowed for phase-wise development of trunk infrastructure.

With this latest easement, Mr Puri said the FDI can now be brought into the construction sector in any amount and for any size of project.

“This will have a huge positive impact on the housing sector as a whole, but much more so on the affordable housing segment, which was so far not a beneficiary of FDI in any significant manner,” he added.


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