Anuj Puri, Chairman – ANAROCK Property Consultants
India has registered a historic improvement in latest ranking for Doing Business, released on 31st October by the World Bank.
In fact, it is one of the top ten improvers for the current year assessment, thanks to the implementation of key reforms pertinent to 8 out of the 10 indicators that World Bank factors in for this index.
With the overall ranking of India in the Ease of Doing Business jumping from the 130th to the 100th place compared to previous assessment, India is the only large country displaying such a significant improvement. How has real estate performed in this improvement? Actually, it’s a bit of a mixed bag.
India’s ranking for Dealing with Construction Permits has improved from 185 to 181, for Resolving Insolvency the improvement has been from 136 to 103, and for Paying Taxes from 172 to 119. However, on the parameter of Registering Property, it slipped 16 places from 138 to 154th.
The key reasons for the lower ranking in for this vital criterion when compared to other counties are the continuing multitude of procedures to follow and therefore more time developers have to spend in pursuing them.
Anuj Puri, Chairman – ANAROCK Property Consultants Pvt. Ltd.
Real estate development remains a highly lucrative business line, which is why most builders retain skin in the game even in the face of strong market headwinds.
However, real estate development also remains a highly capital intensive business, and among the many new market truths that RERA has brought to the fore, the fact that only well-capitalized players will endure going forward stands out.
The ‘time-honoured’ practice of raising funds from the market via ‘pre-launches’ has now become untenable.