With the BJP now elected into power, there are high expectations for the Indian infrastructure industry to take off in all earnestness. This is a very important development for real estate, since the sector cannot grow without the implementation of modern infrastructure projects.
The state of infrastructure of a country is a direct indicator of how well its urban systems work. Also, all activity that is related to industries, business, professions or indeed any activity that contributes to the sustenance of cities and individuals depends on how well the infrastructure system works. However, the problem that India has so far been facing on the infrastructure front is far more complex than it seems at first glance.
Urban infrastructure is obviously not a singular concept. It includes various services and facilities like roads, water and electricity supply, waste disposal, healthcare and education services, communications, etc. But in a country like India, housing must also be seen as an integral part of the infrastructure. All infrastructure is basically geared towards making a city more inhabitable and economically viable. But without sufficient housing to accommodate the very people that infrastructure is meant to serve, the entire concept becomes hollow and meaningless.
This is the reason why the Indian real estate industry has for so long been campaigning for being declared as an industry rather than a mere business vertical. It is also the reason why housing in India needs to be given infrastructure status. The Indian real estate industry is depending heavily on the new government to make these extremely important changes and allow the sector to grow on the back of the corresponding incentives to developers and buyers.
It is also important that the numerous infrastructure projects that have been pending because of mercenary bureaucratic tangles be either launched or completed in the shortest possible time. There has never been a lack of funding for these projects. At various points in time, bilateral and multilateral agencies such as the KFW, the Asian Development Bank, the World Bank and the International Monetary Fund have offered to back infrastructure projects in India.
However, what has been missing is effective deployment of such funds. This calls a firm consensus at the political and policy-making levels, which have been notably absent from the picture so far. Also, the proof of effective policy reforms lies in their implementation, not in their drafting. Therefore, the challenge for the new government lies in bringing about a width and depth in infrastructure-related policies, markets and economic milieu that allow the optimal utilization of available funds at the State level.
Since its mandate on these issues is non-ambiguous and decisive, we have every reason to believe that the new government will address the problems related to infrastructure in the country, and that we will be seeing encouraging developments on this front in the future.
Kishor Pate, CMD – Amit Enterprises Housing Ltd