Lockdown impact: Real Estate will incur the maximum damage, who is to be blamed?
Recently, the autonomous and self-regulatory real estate body NAREDCO has estimated the loss of over one lakh crore rupees amidst the outbreak of coronavirus and the pan India lockdown that resulted in absolute halt in the progress of the industry. Seeking support from the government, the body has also demanded a $200 billion package from the government along with suspending insolvency law for at least six months.
But what is the reason that the Indian real estate cannot even afford a month-long breakdown and who is to be blamed for that? The answer lies in the bursting of the Indian property bubble which was created by a few hundred of the over-ambitious developers across the nation. When the NDA government came to power, the bubble got burst and left the whole realty sector in disguise.
Blaming solely the developers would be unjust. The loopholes in the decades-old laws gave few corrupt bureaucrats a chance to create a nexus to earn more and more out of the real estate projects. Consequently, it became a safe haven for investors with hoards of black money. As soon as the new government consolidated itself in the Centre, one of the priorities of the Modi government was to restructure how real estate works in India.
Indian parliament came up with a series of new regulatory laws for the industry while amending loads of old laws. These new laws protected the developers who were not involved in the irregularities but destroyed them who were in any way worked improperly. Since the past 5 years, the industry has witnessed a steep decline in the residential housing sector but exponential growth in the commercial sector.
The present condition of the real estate sector is due to the pal-practices of a few thousand people across the nation which has brought immense pain on the part of the Indian economy. However, blaming and shaming is not the solution to the problems that are standing in front of us. The government must ensure that no such situation ever happens again so that the sector that is one of the biggest employers in India doesn’t suffer as much as it is suffering at present.