Focus and leadership is required for real estate sector : Hiranandani

Mr. Niranjan Hiranandani, MD, Hiranandani Constructions Pvt Ltd.
Union Budget 2011, finance minister has presented balanced budget to the country. It would seem that some of important issues affecting the Indian real estate sector at this sensitive stage have been missed.
Budget observations by Mr. Niranjan Hirnandani:
· The finance minister has presented balanced budget and primarily he tried to bring down the fiscal deficit to 4.6% of the GDP.
· Huge emphasis has been done on agriculture sector and development of collateral infrastructure like warehousing and cold storage. Also important has given to infrastructure including metro train in Mumbai; FM has allocated Rs. 40 thousand crore for infrastructure bonds including Rs. 5000 crore for Hudco.
· The priority sector lending has been increased from Rs. 20 Lakhs to Rs. 25 Lakhs and interest subvention of 1% on loans up to Rs. 15 Lakhs for home not exceeding Rs. 25 Lakhs.
· Introduction of MAT for SEZ appear to be derogatory step, as this is contrary commitment made by GOI to investors for SEZ. Today more than Rs. 10,000 crore FDI and other funds have invested in SEZ’s, On the basis of earlier commitment of GOI that it was be not taxed. It would be in fitness of thing of FM not to tax SEZ where investments have already been made.
· FM has also proposed the scheme for affordable housing which till to be announced.
· In the last year the government has introduced the VAT for residential housing, beside various other taxes on material & services pertaining to housing have been hugely taxed. Today 32% of the total cost of construction is tax imposed by the Central, State and local government.

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