The government’s vision to achieve Housing for All by 2022 will be largely dependent on its ability to stimulate the real estate sector in India by bringing millions in the lower income group under the ambit of home loan eligibility. The policies of the government and the Reserve Bank of India’s (RBI) will play a key role in providing liquidity to the sector by stimulating demand, especially in the affordable housing segment, which is the most crucial impediment to this vision’s realization.
The recent relaxation of Foreign Direct Investment (FDI) in construction, efforts to make the Indian economy more lucrative for investment by foreign investors. The reduction in the minimum area for development as well as the minimum investment has widened the investor base that can now enter the country. Given lucrative the shortage of land and its high cost, the relaxation in norms is expected to help attract investment in the construction sector which has a multiplier effect on all other industries in an economy, largely by way of infrastructure creation.