Finance Minister Nirmala Sitharaman on Tuesday signalled more possible steps towards reviving a slowing economy particularly highlighting the real estate sector woes.
"Since August, we have been announcing various interventions in such a way that the market is revived, the consumption and demand is revived. Even as we are doing it, there is a lot of work to be done yet," said Sitharaman.
India's economic growth slumped to 5 per cent in the April-June quarter and the growth is expected to remain sluggish in the second quarter, too.
"If we map the leading indicators showing acceleration, there is a distinct possibility that the growth in GDP in Q2 will be lower than 5 per cent (or closer)," Soumya Kanti Ghosh, group chief economic advisor at State Bank of India said in a recent research report.
In this backdrop, the finance minister's statements assume importance. The government has already announced a slew of relief measures including cutting corporate taxes and all eyes will now be on what more steps it takes in the coming months.
She stressed on real estate and the need to address the slowdown in the sector.
"Real estate sector required a lot more attention because the sluggishness, which prevails there, has to be addressed," Sitharaman said.
She was speaking at the silver jubilee celebrations of the National Stock Exchange of India.
Since the government's move to ban high value currency notes three years ago, followed by the rollout of Goods and Services Tax and Real Estate (Regulation and Development) Act, India's housing market has seen a sharp downturn, with sales growth slowing and inventories rising. The crisis in the non-banking financial services sector, a key source to raise funds, has added to the woes of realty firms.
Sitharaman said much importance needed to be given to real estate sector as it had a lot of spillover effect on many other sectors.
"Not just the middle class home buyer, but the fact that on and off it depends on the core Industries, it is going to have a serious positive impact," she said.
The government is very keen and is working together with the Reserve Bank of India to see if existing norms could be tweaked to help people affected in the sector.
She further said that there had been an interest from alternative funds towards India's realty market.
"There are alternative funds, which are now approaching us saying we would like to do something with you all so long as there is supporting mechanism available for reviving real estate sector," Sitharaman said, without giving more details.
