Atma-Nirbhar Bharat: Impact on The Real Estate

With the coronavirus pandemic going on, new trends are coming every day. With this came the new slogan given by our PM Modi, “Atma-Nirbhar Bharat”. But, this slogan faced a lot of criticism. Some said that self-sufficiency during the times of a pandemic is a hoax. While a few called it to be a publicity stunt. On the flip side, some people called it the need of the hour.

To put in simple words, the pandemic has led to the slowdown of the economy. Furthermore, the realty sector has been one of the worst-hit sectors with this slowdown. In fact, this segment faced tremendous hurdles as construction projects got delayed. Besides, expenses continued to rise and this created a tough situation for all the investors as well as the builders.

With these losses, came the beneficiary schemes of the government. The government announced a special liquidity scheme worth INR 30,000 crore for Non-Banking Finance Companies (NBFC’s), Housing Finance Corporations (HFC’s) and Micro Finance Institutions (MFI’s). This helped these sectors in the best way possible. Furthermore, the Government of India made an amendment. By this COVID-19 disorder will be treated as force majeure. Besides an extension of 6 months/9 months to be provided for varied to completion timelines.

We noticed an impact on the real estate. Now let us look at the benefits people reaped out of these schemes.

Atma-Nirbhar Bharat: Impact on The Real Estate

Undeniably, the realty sector is the second biggest employer in the country. The government should have given out some money and empowered this sector with liquidity so that they could make the ends meet.

The Reserve Bank of India allowed an extension in the Date of Commencement for Commercial Operations (DCCO) for the loans for the next 365 days.

Loans given by the NBFCs to this sector also fall under the same relief measures. The aim was to reduce the financial burden.

And in the end, the additional offerings were made like guarantee and collateral-free loans, government procurement was made more efficient, funding was available through equity, e-market linkage and higher thresholds were introduced.

Atma-Nirbhar Bharat: Practical Implication

After all this, the practical implication of the same was imperfect. Besides, we need to analyse the pain point of this industry. This is the direct apportionment of cash and shortage of money for interests. Provisions for the same were either not passed or were not implemented in the best ways possible. Some other amendments should have been made for the Atma-Nirbhar Bharat Movement.

The home loan should have gone down. This would have attracted more and more investors in the home loan. It would have given a Suo-Moto push to the banking sector in unimaginable ways.

The long list of benefits which were thrown at the way of Medium, Small and Micro Enterprises (MSME) should have been also given out to the realty sector. This would have enabled them in paying the fixed expenses.

Apart from this, it was important to consider the migrant labour crisis ahead of time. The most painful effects of the pandemic came from the migrant labourers. Hope. we could avoid this with proper planning.

To Sum up

The realty sector needs the actual push. This would help in implementation at a massive level throughout the country.

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