The latest figures suggest that growth is stalling yet again. Policy must respond by stepping up expenditure from the budget, and prioritising resumption of stalled real estate projects, as these can absorb investment without delay and have the capacity to generate downstream demand for cement, steel, paint, furniture, fittings, curtains, cushions and lots of labour.

Greenfield projects are, indeed, important, but shovel-ready projects are imperative to give the economy the stimulus it requires. The size, structure and scope of the stressed real estate fund surely needs to be promptly revisited on concrete terms, to absorb capital fast. The core sector, which comprises eight segments, has posted its steepest contraction in six months; manufacturing output has hit a seven-month low as per the Purchasing Managers’ Index (PMI) data.

Back in 2019, Nirmala Sitharaman had announced the setting up of a `25,000-crore Alternative Investment Fund (AIF) to gainfully provide funding for stalled incomplete housing projects. Focused policy measures to shore up funding for the stalled projects now would pay rich dividends and sooner rather than later.

The funds under the special window for affordable and mid-income housing can well be raised from the current Rs10,000 crore to at least twice the figure to better coagulate resources on the ground. Further, the Centre surely needs to open up the stressed real estate fund to overseas investors, on the lines of the National Investment and Infrastructure Fund (NIIF).

In tandem, foreign direct investment (FDI) norms for real estate require to be liberalised to increase cross-border funds flow. Foreign investments should be exempt from requirements such as a minimum built-up area of 50,000 sq m for development projects or 10 hectares for plotting schemes. Speed is of the essence in unlocking the value in builtup assets identified for a monetisation pipeline, and channelling the funds into fresh projects that fill gaps and create demand for capital and intermediate goods.

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