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Gujarat has highest share in real estate sector in the country :ASSOCHAM

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Gujarat Global News Network, Ahmedabad

Gujarat has highest share of 41 percent in the new investments in real estate sector across the country during the last fiscal. Despite talks of real estate going down the figures released by ASSOCHAM today throw a big surprise. The state attracted investments worth Rs. 17,000 crore as on March 2013 from just over Rs.2,000 crore a year ago.

According to a real estate specific analysis carried out by ASSOCHAM there has been decline in investments in this sector nation wide. The sector attracted new investments worth only Rs.42,000 crore as on March 2013 while alst year it was Rs. 92,600 crore.

Kerala is another state which has seen massive growth of over 550 percent followed by Uttrakhand 400 percent and Rajasthan 175 percent, D S Rawat national general secretary general of ASSOCHAM said in a press release. Most of the states have witnessed a drop of over 50 percent in new investments in realty sector.

Apart from Gujarat, 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 new investments attracted by real estate sector across India, 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.

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.”

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