Indian apex bank is projecting GDP growth of 9.5% for FY2022 - GulfToday

Indian apex bank is projecting GDP growth of 9.5% for FY2022


Office and residential buildings are seen in Mumbai, India. Reuters

V Nagarajan

With the Covid-19 pandemic causing considerable dislocation on all sectors of economy over the past two years, Indian economy is now showing signs of recovery.

The apex bank is projecting GDP growth of 9.5 per cent for FY 2022. While some sectors are notching up healthy growth, others are continuing to languish.

On the real estate sector, it has led to a paradigm shift in the way of working, consolidation among developers and exit of certain developers.

What are the top trends predicted for the new year 2022.  Knight Frank India takes a look at some of the key sectors. On the residential front, after a prolonged period of falling and then stabilising, residential prices are likely to start rising again.It has been projected that capital value growth for the residential property segment will be around 5 per cent in 2022.

Many of the supply and demand-side factors assessed over the last decade, have started putting upward pressure on house prices. Residential sales momentum is expected to continue in 2022 as prospective homebuyers’ preferences for bigger homes, better amenities and attractive pricing will keep them interested to seal the deals.

As regard office market, it will be driven by the upswing in Information Technology sector’s leasing momentum.

Based on the hiring in the past 18 months, KFI estimates the top 5 IT companies’ incremental demand for office spaces to be nearly 11.67 million sqft going forward.Co-working sector will benefit as pandemic reinforces the need for agility like never before.

Agility, a keyword associated with the co-working sector, will drive the demand rebound for flexible office spaces despite the return of normalcy.Regarding warehousing, e-commerce segment will drive growth in the warehousing sector, with its share in total warehousing transactions increasing to 36 per cent in the financial year 2023 (FY 2023) from 31 per cent in the financial year 2021 (FY 2021).

Overall warehousing transactions projected to grow at a CAGR of 20 per cent in the financial year 2023 (FY 2023).

Speed and technology emerge as key considerations for occupiers’ warehousing strategy. Resilience of Indian real estate investment trusts (REITs) during the pandemic and growing popularity with retail investors will help pave the way for other commercial real estate REITs.

On data centre, with the imminent implementation of 5G and data localisation norms, the need for data storage to be closer to its users assumes greater importance and requires the country’s data centre capacity to scale up quickly.

KFI estimates that approx. 290 MW of IT load will be added in 2022 to the market, to take the total-built IT capacity to 735 MW by the end of the year. According to Ramesh Nair, Chief Executive Officer (CEO), India and MD, Market Development, Asia, Colliers, residential and industrial & warehousing sectors have emerged as major beneficiaries this year garnering a combined 36 per cent of the investments.

While the office will continue to remain a dominant sector, investments in residential and industrial & warehousing are likely to strengthen in 2022 aided by strong business fundamentals.

Income visibility and stability, attractive valuations and identifying the dark horses will underline the investment ethos in 2022.I purchased a flat in 2018 and selling it now.  I want to use the sale proceeds to renovate my ancestral home.  Will the capital gains exemption be available for renovation?  Please clarify.  Raj Mohan, Sharjah.    

No.  Section 54 provides relief from long-term capital gain only to the extent of using such capital gain in the purchase of another residential property within one year before or two years after the due date of transfer of the property sold or construction of residential house property within a period of three years from the date of transfer/sale of property.

So the amount spent on renovation will not be allowed under section 54.However, if a new floor is added it could be allowed.

I have let out my small land to a vendor for over 25 years.  He is now refusing to vacate and citing his long stay as the reason and wants a place in the new building.  What is the legal remedy?  Pranam Sudhir, Dubai­.

This is normally what happens when a tenant is allowed to continue for a long period.  But he cannot seek any special protection for his longer stay.

You could invoke any one of the available ground under the Rent Control Act to evict the tenant. Reconstruction is a valid ground to proceed against the tenant and it is not necessary that you should offer him a place in the reconstructed area.

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