Developers and Consultants Express Disappointment Over RBI's Credit Policy
Real estate developers and consultants have voiced their disappointment regarding the Reserve Bank of India's (RBI) latest credit policy announcement. They have appealed to the central bank for an infusion of more liquidity into the overall financial system, and specifically into the property sector.
"It’s disappointing but understandable," remarked Sanjay Verma, Managing Director (South Asia) at Cushman and Wakefield, a global real estate consultancy.
Verma acknowledged that while inflation is decreasing, its persistence in double digits raises concerns that increased liquidity might fuel further price increases.
"For me, the availability of credit to developers should be the bigger priority. Demand is there, someone needs to supply," Verma added, emphasizing the importance of facilitating developers' access to funding. He further pointed out that the current liquidity crunch is severe enough to cause construction delays, a situation he considers more detrimental than a high-interest-rate environment.
Pradeep Jain, Chairman of Parsvnath Developers Ltd, also expressed his disappointment. "There is disappointment as the financial markets and the entire productive sector were expecting some relief from the credit policy as it was anticipated that RBI would reduce the bank repo rate and CRR," Jain said. He noted that the policy has shaken investor confidence, evidenced by the Sensex plummeting to its lowest point since 2006.
Ashok Bansal, Director of Suncity Projects echoed the sentiment of unhappiness with the policy. "We were expecting some relief from RBI but that did not happen. We are disappointed," he stated.
Amit Sarin of Anant Raj Industries added to the chorus of disapproval: "We are disappointed. The RBI should take some bold decisions to bring back positivity in the market”.
The RBI maintained the repo rate at 8% and the cash reserve ratio (CRR) at 6.5% in its latest credit policy announcement.