In the wake of some recent housing loan scams and adverse judgements by the Competition Commission of India (CCI) against certain realty companies, the central government is preparing a comprehensive Bill on a regulator for the real estate sector.
In her inaugural address at a global conference on the sector organised by the Federation of Indian Chambers of Commerce and Industry, Minister for Housing and Urban Poverty Alleviation, Kumari Selja, said the legislation would emphasise self-disclosure, transparency, fair play and dispute resolution.
She said the aim was to get cabinet approval before the winter session of Parliament. “There is an immense need to improve the regulatory environment, governance and transparency in the sector. The central legislation envisages a regulator at the central level and in states. Besides, there will be an appellate body. Protection of the interest of consumers will be of prime importance,” the minister said.
She admitted the regulatory and approval procedures for projects need to be improved and made quicker. She said at task force headed by the ministry’s secretary was looking at the issues. “The task force will seek suggestions from states and members of the realty industry,” she added.
Several influential voices from the sector — Housing Development Finance Corporation chairman Deepak Parekh is one and Tata Housing is another — have made a strong pitch for a regulator. The aim being transparency and a ‘level playing field’ to safeguard the interest of consumers.
The minister said the sector’s image had suffered due to the recent housing loan scams, judgements by the CCI and controversies on land acquisition for projects across the country. “The players in the sector need to come together and take action for overhauling the image of the sector,” she said. On land acquisition challenges, Selja said the recent unfortunate events in some states had put the sector in a bad light.
“Land acquisition challenges need to be overcome for the growth of the real estate sector. I am sure the new central land acquisition Bill presented in Parliament would be passed after taking all the concerns on board. The thrust on making the land owner a partner in urbanisation and adequately compensating all the persons dependent on land being acquired would give a humane face to the acquisition and would make development more inclusive, hassle-free and sustainable,” the minister said.
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On low-cost housing, Selja advocated a certain percentage of land in all housing developments need to be reserved for poorer groups. “We are working with the states to see that the reservation does not affect the bottom line of the sector,” she added.
On constraints in mobilising funds in view of the successive rate increases by the central bank, the minister said she’d already taken up the issue with the Prime Minister and the finance minister.