FDI PolicyWith a view to protect the interest of small and medium retailers and SMEs, the new government's manifesto has more or less conveyed its resistance to opening up FDI in certain sectors.
Retail is in the negative list as per the manifesto; however, if the country has to welcome FDI and international investors, it might need to consider the number of international retailers waiting on the side-lines in wait-and–watch mode.
A few retailers have already announced their plans to go ahead with the cash & carry model of operation in India, therefore kick-starting a new cycle of investment in retail.
The overall FDI policy will be conducive, as the new government is committed to promote FDI in other sectors and also to reforming the Foreign Investment Promotion Board (FIPB) functioning to make it investor-friendly.
Hospitality Sector I foresee healthy growth of the hospitality sector in the medium term, as the new government has a clear mandate to uplift tourism across various circuits and regions. Its focus is to build 50 tourist circuits with provision of affordable hotel
amenities. Even in developed cities like Mumbai, budget hotels or serviced apartments, and midscale hotels together account for not more than 17-20% of the total room inventory. This category, therefore, is poised to witness significant growth.
Infrastructure With increased focus on shifting a portion of the commuter traffic from road and rail to inland and coastal waterways, the productivity of existing road-rail infrastructure will improve.
New rail corridors such as Agri-rail and tourist rail networks will create newer opportunities in the warehousing, cold storage and hospitality sectors, which definitely benefits real estate. All industrial corridor development plans envisaged but not implemented by the previous government are likely to be fast-tracked.
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