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Press Release

The size of the urban sector will double in the next 25 years: Kuldip Narayan, Joint Secretary (HFA), Union Ministry of Housing and Urban Affairs

Mar 21, 2023

NEW DELHI 21 MARCH 2023: The size of the urban sector will double in the next 25 years, said Mr Kuldip Narayan, Joint Secretary (HFA), Union Ministry of Housing and Urban Affairs, at the 16th FICCI Real Estate Summit today.

He said the requirements for facilities, residential spaces, commercial spaces, and urban infrastructure would double, adding, "we have a lot of catching up to do in infrastructure".

"With increasing urbanisation from 12 to 30 per cent, the next 20 years could see more development than in the last 50 years", he added.

Mr Narayan also alluded to changes in construction technologies, highlighting the government's "consistent stand on reducing carbon emissions and improving energy efficiency" and encouraging the industry to "adopt better and resource-efficient construction technology".

Mr Narayan spoke on Credit Linked Subsidy Scheme (CLSS) and said it became so popular that out of a total portfolio of about 30 lakh crore, almost five lakh crore is funded or some subsidies given in some part under CLSS. "When we compare it to all interests subvention schemes earlier to CLSS, the number of beneficiaries works out to be almost 2000 times", he said, adding, "almost 55,000 Crore interest subsidy was given to loan accounts that we have just finished", he said.

On occasion, Mr Raj Menda, Joint Chairman, FICCI Real Estate Committee and Corporate Chairman, RMZ Corp, said, "after consecutive years of slowdown in the sector, last year witnessed unprecedented growth by reaching a new historical height in the commercial office segment". He added that "the extraordinary demand of flex space from medium and large enterprises further propelled the sector growth".

Mr Menda underlined that 2023 would see more significant developer activity to improve building efficiency, design adequacy and sustainability criteria. "The demand for Grade A premium office assets is likely to increase to 1.2 billion sq. ft. by 2030 in India", he added.

Besides, Mr Vipul Roongta, Co-Chairman, FICCI Real Estate Committee and Managing Director and CEO, HDFC Capital Advisors, said four or five C's had defined the macro approach. These are "COVID, Conflict, China, Construction cost, and Crisis in financial markets", he said.

Mr Roongta spoke on affordable housing and said, "it is where 99% of the demand is, where people are making money, inventory is getting sold, and enough intervention is happening on the supply side".

In his welcome address, Mr Arun Chawla, Director General, FICCI, said, "with an increase in urbanisation and household incomes, the demand for residential real estate has seen an unprecedented surge. As a result, India is now among the top 10 price-appreciating housing markets internationally. This year, when India celebrates the Amrit Kaal, this will surely be recognised as a major hallmark in the country's list of achievements".

During the event, two knowledge reports were released. The first, FICCI-Vestian Knowledge Report on Warehousing & Logistics Sector in India: A Brief Analysis, assesses various warehousing market trends and key policies that are helping to define the industry and the developments anticipated in the forthcoming period.

The second report, FICCI-Colliers Knowledge Report on Emerging Trends and Opportunities in Office Sector - 2023, looks at how offices have changed over the last five years and the key factors that are likely to influence the office sector, at a time when the definition of "office" has taken a new meaning since the pandemic.

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