Confederation of Indian Industries (CII) has set up a special urban development sub-committee under the chairmanship of Adi Godrej to identify ways to help boost the housing and real estate business.
Other chambers like Assocham and Ficci, too, are considering setting up separate study groups to assess this sector.
The CII committee will be presenting its findings and recommendations to the government by the middle of June, industry sources told Business Standard.
Besides Godrej, the CII panel also includes P Vakil, managing director, Knight Frank; J Kanga, advisor, Tata Housing; G Seth, director of GE Shipping; Deepak Satwalekar and Deepak Parekh of HDFC; K P Singh, managing director, DLF group, V Suresh, managing director, HUDCO; besides several others representing major corporates who have gone into housing as a business.
"While the government has decided to lay special impetus to the housing sector, besides fiscal support, steps have to be taken to kick start the sector, and thereby the economy,'' sources said.
"The housing sector is labour intensive, a growth in this sector will help boost the offtake of cement and steel. Besides, the need for other related infrastructure, means a growth in this sector will ensure a growth in related businesses," sources pointed out.
"In the last fifty years very little has been done for this sector, there is an inherent housing demand and the government should look beyond just fiscal sops for tapping this,'' sources said. The industry is expected to recommend that the government open up the housing sector to foreign direct investments and look at cheaper cost of debts in a bid to boost the demand for houses.
"The insurance sector could be given certain special incentives to fund housing, as the insurance companies have recourse to cheap funds, besides the government should seriously look at allowing the setting up of real estate investment trusts which are currently not allowed under Sebi rules,'' the sources added. Besides, the government should also consider partnering the private sector to set up model cities and large scale housing projects,'' the sources added.
"The other problem is the plethora of laws and bye-laws and red-tape which complicates housing business in India.
To get land itself is very difficult and the entire process in overly regulated, hence the government should also look at simplifying the system,'' the sources added. It may be mentioned that the government has in its recent budget committed itself to constructing 20 lakh houses in the current financial.
The budget has also announced major fiscal sops to develop this sector.
