States and UTs collected Rs. 2 lakh crore (US$ 24 billion) in FY23 from the real estate sector: Report
According to a Naredco-Knight Frank India report, the real estate sector is one of the main contributors to the revenue of states and UTs, which collected an estimated Rs. 2 lakh crore (US$ 24 billion) in FY23 through a variety of sources, including stamp duties. The report said this amounts to 5.4% of the total revenue collected by all Indian states and union territories in 2022-23.
Realtors' body Naredco and property consultant Knight Frank India recently released a report 'India Real Estate: Vision 2047'.
The size of the Indian real estate market is predicted to jump more than 12-fold to US$ 5.8 trillion by 2047 from US$ 477 billion last year, according to the report's projections. Furthermore, the sector will contribute over 15% to the total economic output of the country in 2047 from an existing share of 7.3%.
When India will celebrate 100 years of independence in 2047, it is predicted that its economy will be worth between US$ 33-40 trillion. For research purposes, Knight Frank has assumed that the Indian economy will increase on average by US$ 36.4 trillion by 2047.
The size of the residential real estate industry is predicted to increase from US$ 299 billion last year to US$ 3.5 trillion in 2047, according to the analysis. In addition, the office real estate industry is projected to increase in size from US$ 40 billion to US$ 473 billion, and the warehousing sector is projected to increase from US$ 2.9 billion to US$ 34 billion.
According to the report, India's real estate market has developed into a source of funding for infrastructure development in the country.
By utilising the rise in land and real estate values brought on by public investments and policy efforts, mechanisms like value capture finance have made it possible for state governments and municipalities to raise money.
According to the report, "value capture financing tools like land value tax, betterment levy, development fees charges, transfer of development rights (TDRs), etc. have enabled the generation of additional revenues which have further been used to fund the development of the cities' infrastructure."
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.