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| Gfycat |
The real estate sector was expecting direct support for itself in the Union Budget 2022 - you know stuff like infrastructure status, GST revisions, tax breaks et al - but the Finance Minister took the route of government spending instead.
Naturally, real estate offices all over the country today reported a strange aroma in their coffee cups, the distinct smell of dissatisfaction.
But, But, But. . .
Budget 2022 seems to depend on the strong inter-dependency of real estate with the overall economy. The rise in government capital expenditure by 35% over last year - budget estimates of INR 7.5 lakh crores - is expected to fuel all engines powering the economy.This increased economic activity will help the real estate sector in particular, by keeping demand for residential, industrial, and commercial real estate high.
Zooming In
Apart from the INR 48,000 crore incentive to affordable housing, Budget 2022 dishes out substantial structural support to the real estate sector.
🏗 Infrastructure status for data centres will propel the industrial and commercial real estate through increased institutional investments.
🏗 The proposed new legislation around special economic zones (SEZs) should lead to increased capacity creation for industrial and commercial real estate, and with the emergence of more sizable assets, Indian real estate investment trusts (REITs) will scale newer heights.
🏗 The budget also maintained its long-term commitment for supporting creation of smart and sustainable real estate across Tier 2 and 3 cities, by establishing centres of excellence for urban planning.
Zooming Out
And no matter how desirable, direct sops to sectors which have been riding a four to five year cycle of structural reforms, is not on today's agenda.