Indian government seeks US$300b in funding for property sector

The Indian government is seeking to attract foreign investment into its booming property sector.

According to some estimates, investment in the sector can reach as much as US$300 billion, over the next five years.

Ascendas, CapitaLand, Jurong Town Corporation and Sembawang Corporation are some of the big Singapore companies expanding rapidly in the red-hot Indian property market.

According to members of the Indian Chambers of Commerce and Industry, who are here in Singapore to attract investment from local companies, opportunities abound in the residential, commercial and industrial sectors.

Vivek Bharati, Advisor, Federation of Indian Chambers of Commerce and Industry, said, “Today you have a shortage of around 22 million homes; there is an opportunity in Indian residential homes. When you look at residential homes, since the major cities are getting very crowded, very congested, there is an opportunity for making integrated townships.

“The government encourages foreign direct investments in townships. (There is a) whole new opportunity because of rapid growth in IT services and process outsourcing, business outsourcing…which accounts for nearly 75 percent of all new office space.”

The Indian government is also keen to attract more fund managers to invest in its property sector.

Mr Bharati said, “Singapore is also the hub for fund managers who are investing in real estate funds…Earlier they were looking at portfolio investments in various segments of the economy. Real estate has emerged in the last two, three years only.”

Prices in the Indian property market are estimated to have surged by some 25 percent in the past three years.

Source: Channel NewsAsia, 04 April 2007

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