Driven
by positive growth in the economy, real
estate in India is booming. The year
2006 started on a promising note when
the Government of India opened the construction
and development sector in February 2006,
and allowed 100 per cent foreign direct
investment (FDI) under the 'automatic
route' in order to spur investment in
the vital infrastructure sector. The
government has thrown open the lucrative
parts of the Indian realty market to
global investors for the first time.
The relaxation of the FDI ceiling saw
big names joining hands with the Delhi-based
developments to announce India's largest
FDI in the realty sector. Groups showing
interest in India includes major Indian
and international companies.
The development of real estate in India
focuses on two primary areas: retail
and residential.
The organized segment is expected to
grow from a mere 2 per cent to 20 per
cent by the end of the decade, it said.
The boom is also attracting interest
of foreign players. In recent years,
non-resident Indians (NRIs) have played
a very important role in transforming
the Indian real estate market. Opening-up
of the Indian economy provided them
with new opportunities and they have
shown a great deal of confidence in
the changed set up. Since 1994, NRIs
have invested a sizeable amount, of
which a big chunk has found its way
into the property market. Participation
by NRIs has brought about a lot of maturity
in the market, which in the past was
solely banked on the actual users.
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