Influx of Retail FDI Welcomed in India
The Indian central government's decision to permit 51% Foreign Direct Investment (FDI) in retail has elicited a range of reactions. While some express concerns about potential job losses, a contingent of real estate developers in Odisha has embraced the move.
Mr. Sitaram Yechury, CPI-M politburo member and MP, voiced strong opposition, stating, “that this decision of the government will lead to affect millions of people directly and indirectly.” He further emphasized the scale of the impact, adding, “one fifth of the Indian population is going to be affected by this wrong decision.”
Odisha Developers Foresee Positive Impact
In contrast to the apprehension, real estate developers in Odisha have lauded the Union Government's decision. This move aligns with the Odisha government's stance on welcoming retail FDI.
Boost to Real Estate Sector Anticipated
Odisha's real estate developers believe this policy change will invigorate their sector. Mr. Tapan Mohanty, Managing Director of Z Engineers Pvt. Limited, articulated the developers' sentiment, stating, “that the real estate developers welcome the government’s decision.” He further affirmed his confidence in the decision's potential, adding, “this decision is sure to foster the real estate sector in the state.”
Mr. Mohanty also expressed his hope that the Odisha state government will actively facilitate and accommodate these retail investors. He emphasized the broader economic benefits, stating that FDI in retail will not only stimulate the real estate sector but also accelerate the state's economic growth, signifying FDI's substantial contribution to the state's overall economic prosperity.
Odisha Cities and Population Criteria
Interestingly, no city in Odisha currently meets the central government's criteria for inclusion in a list of 53 cities designated for this initiative. This list is based on a minimum population of 1 million. Real estate developers have suggested that incorporating surrounding villages into municipal corporations could enable some Odisha cities to reach the required population threshold.
This proposition of expanding municipal boundaries through the inclusion of neighboring villages, they posit, could elevate these cities past the one-million population mark, thereby qualifying them for consideration.
CREDAI Odisha Chapter's Perspective
Mr. DS Tripathy, president of CREDAI Odisha Chapter, the leading real estate developers' association in Odisha, expressed optimism about the potential upswing in commercial real estate due to the influx of retail FDI. He anticipates a prosperous period for commercial real estate, predicting, “the real estate market is going to be more competitive.”
Projected National Impact
National projections estimate that FDI in the commercial real estate domain will generate approximately 20 million job opportunities in the country within three years. The anticipated investment throughout India is expected to reach up to $700 million.