The Business Line 21.06.2010
Rapid urbanisation calls for Govt focus on infra development
Mr Kumar Gera
Coimbatore, June 20
Indian population is set to be divided equally between urban and rural areas in the next 20 years with some states having more people living in urban centres than in rural areas and it is time for the Governments to build necessary infrastructure facilities before the great urban boom becomes a reality, according to Mr Kumar Gera, National Chairman, Confederation of Real Estate Developers' Association of India (Credai).
He also is of the view that in whichever form, IT concession to home loan borrowers is extended under the proposed new Income Tax rules, it would bring relief to home buyers.
Speaking to presspersons in Coimbatore recently in connection with the launch of CREDAI's new chapters at Coimbatore, Madurai and Tiruchi, he said it is expected that by 2030, population in cities would have grown by an average of 60 per cent. In some cities such as Pune, the growth may be higher at even 100 per cent. He said for the ‘first time India is expected to reach the ratio' of 50:50 urban-rural population dispersal by 2030. Five States in India, including Tamil Nadu, would have greater number of people living in urban centres rather than in rural areas.
He said in the emerging scenario, infrastructure was taking centrestage and warned that ‘if it is not addressed effectively' there would be a gridlock in cities, there would be a collapse and citizens would ‘suffer immensely' because of the demographic shift. Referring to the national scenario in the real estate industry, he said the realty sector came to a ‘virtual standstill' in terms of sales in September 2008 in many parts of the country and prices came down by 10-40 per cent, which was also because of financial institutions getting into a crunch, squeezing finance to developers and home loan customers. While prices are yet to return to the pre-2008 levels, there has been a gradual upturn in prices and demand for residences has become buoyant particularly in the sub-Rs 30 lakh levels and there was good demand up to Rs 1 crore in larger cities. In the commercial segment, other than office space, people are cautious about sectors such as IT spaces and would await the demand to return.
He said Governments were looking at involving the private sector, which is for profit after a competitive process, in infra development.
Mr T. Chitty Babu, President, Credai, Tamil Nadu, said with rapid urbanisation, it was supply and demand that determines the course.
