Viksit Bharat: Empowering Real Estate's Role as a Catalyst for Economic Growth

Real estate stands as a pivotal sector significantly bolstering India's economic growth and generating substantial employment. It serves as a critical provider of housing, infrastructure, and commercial establishments, thereby catalysing various industries and sectors. The expansion of the real estate industry is intricately linked to the overall economic progress of the nation.?

Let’s talk numbers-

In a recent report by CREDAI, the real estate sector accounts for 13.8% of the projected GDP (Closing in about $1.3 trillion by FY 2034). The growth doesn't stop here as we traverse the trajectory upwards with an estimated projection of $5.17 trillion market size (17.5% of the projected GDP) by 2047. Moreover, the report anticipates a surge in housing demand, estimating a need for an additional 7 crore units by 2030.

Viksit Bharat Yojana is a holistic development program launched by the Government of India to accelerate the country's progress across key sectors. The scheme focuses on enhancing infrastructure, promoting innovation and entrepreneurship, boosting manufacturing, and ensuring sustainable development. Under Viksit Bharat, the real estate sector has emerged as a key driver of economic growth, contributing significantly to GDP and job creation.

- Real Estate's Contribution to Economic Growth?

The real estate sector in India has experienced rapid growth, driven by factors such as urbanisation, rising disposable incomes, and favourable government policies. This growth has had a ripple effect on the economy, contributing to GDP growth through various channels:?

Direct Contribution to GDP: The real estate sector directly contributes to GDP through investments in residential, commercial, and industrial projects. According to estimates, the sector contributes around 7-8% of India's GDP, making it one of the key sectors driving economic growth.

Multiplier Effect: Real estate has a strong multiplier effect on the economy. Investments in real estate lead to the creation of additional economic activities, such as construction, manufacturing, and services, further boosting GDP growth.

Infrastructure Development: Real estate development often goes hand in hand with infrastructure development. Investments in real estate projects often lead to the creation of new infrastructure such as roads, bridges, and utilities, which are crucial for economic development

Real Estate and Employment Generation:?

The real estate sector stands as one of the largest employment generators in India, providing both direct and indirect employment to millions.The sector's role in job creation can be attributed to the following factors:?

Construction Activities: Real estate development involves a wide range of construction activities, including building new structures, renovation, and maintenance. These activities require a large workforce, including skilled, semi-skilled, and unskilled labour.?

Supporting Industries: The real estate sector also creates employment opportunities in supporting industries such as cement, steel, and other building materials. The demand for these materials increases with the growth of the real estate sector, leading to additional job creation.

Ancillary Services: Real estate development creates demand for ancillary services such as architecture, engineering, interior design, and property management, further contributing to employment generation.?

Factors Fueling Real Estate Growth:?

1) Rapid Urbanisation: India is witnessing rapid urbanisation, with a burgeoning populace flocking to cities in pursuit of better prospects. This phenomenon has spurred an augmented demand for residential, commercial, and retail spaces, thereby fueling growth in the real estate realm.

2) Government Endeavours: The government has instituted numerous initiatives such as "Housing for All," "Smart Cities," and "AMRUT" to bolster the real estate sector. These initiatives aim to furnish affordable housing and enhance infrastructure, leading to escalated investment in the sector.?

3) Foreign Direct Investment (FDI): The relaxation of FDI regulations in the real estate sector has enticed substantial investments from foreign entities. This influx has engendered the development of upscale residential projects, commercial complexes, and retail spaces, thereby contributing to the sector's expansion.?

4) Infrastructure Advancement: The advancement of infrastructure such as roads, highways, airports, and metro networks has a positive ripple effect on the real estate sector. Enhanced infrastructure attracts real estate developers to invest in burgeoning areas, thereby fostering economic growth and job creation.?

5) Technological Integration: The assimilation of technology into the real estate sector has bolstered operational efficiency, cost-effectiveness, and enriched customer experience. Technologies like AI, IoT, and blockchain are being leveraged to streamline processes and elevate construction quality.

Role of Government initiatives-?

1) The Smart Cities Mission:The Smart Cities Mission in India aims to develop 100 smart cities, focusing on Liveability, Economic-ability, and sustainability. This mission has sparked remarkable progress in various cities, fueling economic growth and job creation in the real estate sector. Here are few examples illustrating this impact:

• Pune's strategic focus on infrastructure development and sustainable urbanisation has led to the emergence of commercial spaces, residential complexes, and IT parks. The city has implemented a smart street lighting project, replacing conventional lighting with energy-efficient LED lights and manual feeder panels. Efforts are being made to transition sustainability from conventional fuel types to more technologically and environmentally efficient ones to curb air pollution. Pune incorporates a wide network of 'smart elements' including city wifi, emergency call boxes, public address systems, environmental and flood sensors, variable messaging displays, and smart city operation centres to increase safety and assist in decision-making. A dedicated airport shuttle service has been added to reduce travel time for residents, using fuel-efficient technology. This emphasis on smart solutions has not only bolstered the real estate sector but also generated demand for skilled labour, creating new job opportunities.?

• Surat's commitment to enhancing its transportation infrastructure is evident in the development of metro rail and BRTS (Bus Rapid Transit System). These projects have not only improved connectivity but also catalysed real estate growth along these corridors, fostering job creation in construction and related industries.?

• Indore's innovative approach to solid waste management, including waste segregation at the source, has resulted in the establishment of waste processing plants and recycling units. This has not only improved waste management, but also created employment opportunities in the waste management and recycling sector.?

• Bhubaneswar's focus on enhancing public transportation, exemplified by the comprehensive city bus service, has not only enhanced intra-city mobility but also spurred the development of commercial and residential projects along bus routes. This has significantly boosted the real estate sector.?

• Jaipur's efforts to preserve and enhance its cultural and historical heritage have led to the restoration and redevelopment of heritage sites. This has not only attracted tourists but also spurred the development of hospitality and tourism-related infrastructure, creating new jobs in the hospitality and real estate sectors.

2) Industrial Corridors: Projects like the Delhi-Mumbai Industrial Corridor (DMIC) and the Chennai-Bengaluru Industrial Corridor (CBIC) aim to establish industrial hubs along key transportation routes. These corridors are poised to drive real estate sector growth and create employment opportunities in the manufacturing and services sectors.

In summation, the real estate sector stands as a crucial driver of economic growth and employment in India. By aligning with the vision of Viksit Bharat and embracing sustainable practices, the sector is making substantial contributions to the nation's development.