Bangalore, May 6, 2013:
The state of Karnataka has ranked third with a share of about 10 per cent in the new investments attracted by the real estate sector across India during the last fiscal, apex industry body ASSOCHAM said today.
“However, the new investments in realty sector attracted by Karnataka plummeted from over Rs 10,400 crore to just over Rs 4,100 crore during the period ranging between 2011-12 and 2012-13, thereby registering a year-on-year (Y-O-Y) decline of about 60 per cent,” according to a real estate sector specific analysis carried out by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
“The realty sector in India attracted new investments worth over Rs 42,000 crore as of March 2013 which slipped from over Rs 92,600 crore a year ago,” said Mr D.S. Rawat, national secretary general of ASSOCHAM while releasing the chamber’s analysis.
While most of the states have seen a decline in attracting new investments in the realty sector, Gujarat has seen a surge of over 700 per cent as the state has attracted investments worth over Rs 17,000 crore as of March 2013 from just over Rs 2,000 crore a year ago.
“Kerala is another state which has seen massive growth of over 550 per cent in attracting new investments in real estate followed by Uttarakhand (400 per cent) and Rajasthan (175 per cent),” said Mr Rawat. “While almost rest of the states have seen a drop of over 50 per cent in new investments in the realty sector during the aforesaid period.”
While, Gujarat has maximum share of about 41 per cent in the new investments attracted by the real estate sector across India, the states of Maharashtra (over 17 per cent), Karnataka (10 per cent), Tamil Nadu (eight per cent) and Uttar Pradesh (over six per cent) are amid top five states with maximum share in this regard, highlights the ASSOCHAM analysis.
Besides, with a share of about 15 per cent, Gujarat is second only to Maharashtra which has maximum share of about 20 per cent in the total outstanding investments worth over Rs 14 lakh crore attracted by the real estate sector across India as of March 2013, according to the ASSOCHAM study.
However, the new investments in realty sector in Maharashtra have plummeted by over 55 per cent during the last fiscal.
Maharashtra has attracted outstanding investments worth about Rs three lakh crore in the real estate sector as of March 2013 but the new investments in the sector dipped from over Rs 16,000 crore to just over Rs 7,000 crore during the course of last one year (2011-12 and 2012-13).
“Realty sector accounts for over 11 per cent share in total outstanding investments worth over Rs 122 lakh crore attracted by different sectors from various public and private sources across India,” said Mr Rawat.
Maharashtra, Gujarat, Haryana, Karnataka and Andhra Pradesh are the top five states with highest share for attracting maximum outstanding investments in the real estate segment across India. Besides, these five states account for over 70 per cent of the total outstanding investments attracted by realty sector across India.
Karnataka has attracted outstanding investments worth over Rs 1.5 lakh crore in the real estate sector as of March 2013 and accounts for over 11 per cent share in total outstanding investments attracted by real estate sector across India.
Outstanding investments in real estate have risen by over 25 per cent throughout the country during the five year period of 2008-09 and 2012-13, further highlighted the ASSOCHAM analysis.
“The real estate sector in India has been plagued with serious problems of late like falling sales, rising construction costs, dampened market sentiment overall, sluggish economic growth, high interest rates, high inflation and poor industrial production (IIP) due to which leading players in the sector had to sell of their land to reduce debt, private equity players have trimmed their exposure in realty sector and general slowdown in various industries has hit commercial real estate,” said Mr Rawat. “However, certain positive developments like parliament’s approval of foreign direct investment (FDI) in multi-brand retail would help attract foreign investments and give a fillip to the retail industry and simultaneously boost the demand for commercial real estate in the country.”
