RBI will make loan affordable & give a boost to the economy
The rate cut by the RBI will give a boost to the Indian economy by providing affordable Loans to small businesses and homebuyers Said by Finance Minister Piyush Goyal.
RBI’s decision to reduce the repo rate by 25 basis point from 6.5 percent to 6.25 percent and change of stance to ‘Neutral’ will give a boost to the economy, lead to affordable credit for small businesses, homebuyers etc and further boost employment opportunities,” Goyal said in a tweet.
It is a very balanced and pragmatic policy statement said by Economic Affairs Secretary Subhash Chandra Garg with Welcoming the RBI’s decision.
“Assessment of growth and inflation is quite realistic and underlines low inflation and high growth path for India for 2019-20. Welcome change of stance to neutral and rate cut by 25 bps. Also welcome removal of FPI restriction,” Garg tweeted.
It was fixed that no foreign portfolio investor (FPI) should be given an exposure of more than 20 percent of its corporate bond portfolio to a single corporate, including exposure to entities related to the corporate. As a part of the review of the FPI investment this was decided in corporate debt undertaken in April 2018.
Exemption were given to FPIs from this requirement till end-March 2019 to adjust their portfolios on their new investments.
The RBI in its sixth bi-monthly policy said it is now proposed to withdraw this exposure limit, In order to encourage a wider spectrum of investors to access the corporate debt market.
February 8, 2019 / by / in , , , ,
GST tweak : Make Up Real Estate Sector’s Budget Wishlist

The real estate sector is expecting the upcoming Interim Union Budget for 2019-20 after being through the various structural changes and demand pressures over the past two years to rationalise the Goods & Services Tax rates for convergence of stamp duties, further incentives for affordable housing and under-construction properties within the GST rates.

To make real estate investment trusts (REITs) more attractive for investors, experts are suggesting making it more tax-efficient for investors.

“REITs have the potential to enhance the supply of commercial real estate — an enabler for the employment ecosystem. For unit holders, the long-term capital gains holding period for REIT units should be brought down from 3 years to 1year,” said Shishir Baijal, chairman, Knight Frank India.

Most developers continue to reinforce a long pending demand of awarding industry status to the sector to contribute to the economy’s growth and support to job creation after given the sector’s linkages with other industries.

“Boosting farm incomes and adding job opportunities are the twin tests for Union Budget 2019-20. Real estate and construction industry fit into the Budget 2019-20 scheme as the second largest employer after agriculture, and contribute close to 10% of GDP. Alignment of GST and personal income tax so as to boost home ownership is a strategic option that government may well consider exercising,” said CREDAI national president Jaxay Shah.

Experts are now also seeking to re-finance NBFCs by raising their limits after given the liquidity pressure created by fears of defaults by realty developers and non-banking finance companies (NBFCs) following the IL&FS default in September 2018.

“For the industry at large, one of the most critical steps that this budget can take is to increase the finance limits for NBFCs. NBFCs constituted more than 50% developer finance in 2018 as against 30% in 2011. The government must revive the sector by pumping in more money into NBFCs which lend to developers,” said Anuj Puri, chairman, ANAROCK Property Consultants.

“A road map to execute the ‘infrastructure status’ accorded to the industry in the previous budget needs to be drawn. Further extension should be given for availing benefits falling under Sec. 8O-IBA for Affordable Housing Scheme under Housing For All. The government can also consider differential GST rate an for apartment value of more than Rs 7,000 per sq. ft,” said Ashish Puravankara, managing director, Puravankara.

Most developers are expecting an abolition of GST payable by the landowner in a Joint Development Agreement (JDA) and also the removal of tax on the unsold housing inventory.

January 29, 2019 / by / in , , , ,