Key government initiatives aimed at encouraging development in India's real estate sector
There are many government initiatives taken by the government of India, which are encouraging the growth of the Real estate sector in India:
Smart City Project:
The Government of India’s Smart City Project presents a significant opportunity for real estate companies to participate in urban development. This initiative plans to build 100 smart cities, providing NRI investment options in India with tremendous potential. For NRI investors in India, participating in these projects can lead to high returns and sustainable growth in the real estate sector.
PM Awas Yojana (Budget 2023-24):
The Union Budget 2023-24 allocated Rs. 79,000 crore (US$ 9.64 billion) to the PM Awas Yojana, representing a 66% raise from the previous year. This substantial investment aims to boost affordable housing, making it an attractive option for NRI investment in India property. With the growing demand for affordable housing, this government-backed scheme is a good opportunity for property investment for NRIs.
RBI Interest Rate Policies:
In October 2021, the RBI managed the benchmark interest rate at 4%, supporting the real estate sector. Low home loan interest rates drove housing demand, leading to an estimated 35-40% increase in sales during the festive season in 2021. For NRI investors in India, this was an ideal time to consider nri property sale TDS and take advantage of the favorable interest rates. RBI guidelines for NRI investment in real estate support such moves and provide a secure avenue for investments.
Union Budget 2021-22:
The tax deduction of up to Rs. 1.5 lakh (US$ 2,069) on interest on housing loans and the tax holiday for affordable housing projects were extended until the end of fiscal 2021-22, further incentivizing home purchases. These provisions have significantly improved the investment opportunities in India for NRIs looking to invest in residential properties. With these incentives, the best property investment in India is more accessible for non-residents.
Atmanirbhar Bharat 3.0 (November 2020):
As part of the Atmanirbhar Bharat 3.0 package, tax relief was provided for real estate developers and homebuyers. This initiative allowed tax benefits for residential units valued up to Rs. 2 crore (US$ 271,450) for sales made between November 12, 2020, and June 30, 2021. This government initiative has created NRI investment plans in India, offering favorable tax policies for those wishing to invest in residential units in India.
Alternative Investment Fund (AIF):
To revive 1,600 stalled housing projects across major cities, the Union Cabinet approved the establishment of a Rs. 25,000 crore (US$ 3.58 billion) alternative investment fund (AIF). This fund is aimed at providing much-needed liquidity to the real estate sector, offering potential investment opportunities in India for NRIs looking for distressed asset opportunities. The AIF provides a gateway for NRI investors in India to engage in revitalized projects with promising returns.
Affordable Housing Fund (AHF):
An Affordable Housing Fund (AHF) was created within the National Housing Bank (NHB), with an initial corpus of Rs. 10,000 crore (US$ 1.43 billion). This fund leverages the shortfall in priority sector lending by banks and financial institutions to support the micro-financing of housing finance companies (HFCs). NRI investment in India in property can be further bolstered by this initiative, which aligns well with the increasing demand for affordable homes across urban centers.
Special Economic Zones (SEZs):
As of December 31, 2022, 425 Special Economic Zones (SEZs) have been formally approved in India, and 270 SEZs are operational as of January 2023, with a focus on the IT/BPM sector. SEZs present exciting investment opportunities in India for NRIs, especially for those interested in commercial and industrial real estate. With RBI guidelines for NRI investment in real estate, such investments are made secure and structured for NRIs looking to capitalize on the growth of India's infrastructure and industrial hubs.
Our Blogs
RBI Guidelines on NRI Real Estate Investment: What You Must Know
Read MoreWhat are the pros and cons for NRI investing in india in their childs name?
Read MoreHow can immovable property be acquired outside India by a resident?
Read More10 Things NRIs should do before buying a property in India
Read More3 Avenues How NRI can invest in Indian Real estate
Read MoreHistorical and future outlook of Indian Real estate sector
Read MoreKey government initiatives aimed at encouraging development in India's real estate sector
Read MoreNRI owning a property in india
Read MoreHere are the key points regarding buying a house using a Power of Attorney (POA):
Read MoreWhat are the major components of technical analysis report at the time of possession of property?
Read MoreNRI owning a property in india
Read MoreRepatriation ?
Read MoreKey government initiatives aimed at encouraging development in India's real estate sector
There are many government initiatives taken by the government of India, which are encouraging the growth of the Real estate sector in India:
Smart City Project:
The Government of India’s Smart City Project presents a significant opportunity for real estate companies to participate in urban development. This initiative plans to build 100 smart cities, providing NRI investment options in India with tremendous potential. For NRI investors in India, participating in these projects can lead to high returns and sustainable growth in the real estate sector.
PM Awas Yojana (Budget 2023-24):
The Union Budget 2023-24 allocated Rs. 79,000 crore (US$ 9.64 billion) to the PM Awas Yojana, representing a 66% raise from the previous year. This substantial investment aims to boost affordable housing, making it an attractive option for NRI investment in India property. With the growing demand for affordable housing, this government-backed scheme is a good opportunity for property investment for NRIs.
RBI Interest Rate Policies:
In October 2021, the RBI managed the benchmark interest rate at 4%, supporting the real estate sector. Low home loan interest rates drove housing demand, leading to an estimated 35-40% increase in sales during the festive season in 2021. For NRI investors in India, this was an ideal time to consider nri property sale TDS and take advantage of the favorable interest rates. RBI guidelines for NRI investment in real estate support such moves and provide a secure avenue for investments.
Union Budget 2021-22:
The tax deduction of up to Rs. 1.5 lakh (US$ 2,069) on interest on housing loans and the tax holiday for affordable housing projects were extended until the end of fiscal 2021-22, further incentivizing home purchases. These provisions have significantly improved the investment opportunities in India for NRIs looking to invest in residential properties. With these incentives, the best property investment in India is more accessible for non-residents.
Atmanirbhar Bharat 3.0 (November 2020):
As part of the Atmanirbhar Bharat 3.0 package, tax relief was provided for real estate developers and homebuyers. This initiative allowed tax benefits for residential units valued up to Rs. 2 crore (US$ 271,450) for sales made between November 12, 2020, and June 30, 2021. This government initiative has created NRI investment plans in India, offering favorable tax policies for those wishing to invest in residential units in India.
Alternative Investment Fund (AIF):
To revive 1,600 stalled housing projects across major cities, the Union Cabinet approved the establishment of a Rs. 25,000 crore (US$ 3.58 billion) alternative investment fund (AIF). This fund is aimed at providing much-needed liquidity to the real estate sector, offering potential investment opportunities in India for NRIs looking for distressed asset opportunities. The AIF provides a gateway for NRI investors in India to engage in revitalized projects with promising returns.
Affordable Housing Fund (AHF):
An Affordable Housing Fund (AHF) was created within the National Housing Bank (NHB), with an initial corpus of Rs. 10,000 crore (US$ 1.43 billion). This fund leverages the shortfall in priority sector lending by banks and financial institutions to support the micro-financing of housing finance companies (HFCs). NRI investment in India in property can be further bolstered by this initiative, which aligns well with the increasing demand for affordable homes across urban centers.
Special Economic Zones (SEZs):
As of December 31, 2022, 425 Special Economic Zones (SEZs) have been formally approved in India, and 270 SEZs are operational as of January 2023, with a focus on the IT/BPM sector. SEZs present exciting investment opportunities in India for NRIs, especially for those interested in commercial and industrial real estate. With RBI guidelines for NRI investment in real estate, such investments are made secure and structured for NRIs looking to capitalize on the growth of India's infrastructure and industrial hubs.
Also Read: NRI owning a property in india