Rate Cuts and Incentives Crucial for Reviving Real Estate, Says Hiranandani
Reviving Real Estate: A Call for Change
At the World Economic Forum in Davos, Niranjan Hiranandani, Managing Director of Hiranandani Group, highlighted the pressing need for measures to revitalise India’s real estate sector. He emphasised that a reduction in RBI interest rates and targeted incentives for housing are critical to spurring growth, particularly in the affordable housing segment, which is experiencing a slowdown. Hiranandani underscored that without proactive steps, India’s broader economic growth could falter, given real estate’s significant role in the GDP. His remarks reflect growing concern among industry leaders over the sector’s uneven performance.
India’s Global Investment Appeal
Hiranandani exuded optimism regarding India’s position on the global investment map. He noted a positive perception of the Indian market, independent of the “China Plus One” strategy, indicating a shift towards India as a standalone investment destination. The commercial real estate sector, bolstered by Real Estate Investment Trusts (REITs), has emerged as a lucrative avenue for investors, with international giants like Brookfield and Blackstone leading the charge. However, the residential sector continues to lag, with muted interest that hinges on government policy and the forthcoming Union Budget.
The Sustainability Dimension
Sustainability remains pivotal to the sector’s long-term growth. Hiranandani pointed out that modern projects incorporating green technologies and energy-efficient designs are more attractive to investors. These initiatives align with global standards and address urban challenges, such as resource management and reducing carbon footprints. As sustainability gains traction, it is increasingly influencing investment decisions, particularly in the commercial and residential sectors. This shift is crucial to aligning India’s real estate growth with global environmental goals, fostering a balance between urban expansion and ecological preservation.
Civic Integration and the Road Ahead
Despite a promising outlook, challenges in civic infrastructure persist, particularly in terms of traffic management, waste disposal, and affordable housing supply. Hiranandani highlighted the need for collaboration between developers and government bodies to address these issues. With adequate policy support and a favourable budget, he believes the residential sector could mirror the success of its commercial counterpart. Additionally, he pointed to a robust investment sentiment in manufacturing, driven by government initiatives and strong ROI prospects, signifying an overall shift in India’s economic narrative.
