Industry & Economy
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Foreign Direct Investment
Cabinet defers decision on FDI in real estate
Our Bureau
New Delhi
,
Feb. 17
THE Union Cabinet on Thursday deferred a decision on permitting foreign direct investment (FDI) in real estate and construction sectors till the completion of the Assembly elections in Bihar and Jharkhand.
"No decision has been taken today. It will be taken up later," the Commerce and Industry Minister, Mr Kamal Nath, told presspersons after the Cabinet meeting here.
Elections are currently being held in Bihar and Jharkhand, with the last round of polling scheduled for February 23.
The proposal was expected to allow FDI in the real estate/construction sector, to enable foreign firms to build on plots starting from 25 acres against the current stipulation of 100 acres (applicable only in integrated townships).
The Government is keen on allowing FDI in the construction sector as it would not only generate employment but also spur development of urban infrastructure besides bringing in hi-tech construction technology.
Industry analysts point out that relaxing the existing 100 acres norm for the FDI inflow into real estate sector would help speed up construction works in the economy. It is difficult to get 100 acres in the urban areas, they said adding that this restrictive clause was a hurdle in the way of higher FDI inflow into the sector.
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