RBI MPC meeting: Real estate developers demand rate cut from Shaktikanta Das

RBI MPC meeting: In a bid to increase sale through lower EMI for the home buyer and more liquidity into the markets, the real estate developers have demanded from the Reserve Bank of India (RBI) to cut the Repo Rate when they come to announce the outcome of their three-day Monetary Policy Committee (MPC) meeting on June 6. The industry insiders are of the opinion that cut in rates would help increase liquidity into the market leading to easy access of funds to the real estate developers and lower EMI for homebuyers.

Parth Mehta, Managing Director, Paradigm Realty said, “The GDP rate in Q4FY2019 nose-dived to 5.8% against 6.6% (in Q3FY2019) & 8.1% (IN Q4FY2018) resulting in overall GDP growth rate to trickle down to 6.6% (FY2019) primarily due to the domino effect of NBFC crisis. The consumption finance has taken a beating with NBFC’s struggling to raise money via Banks or Commercial papers thus accentuating the liquidity freeze. Private investments too were lacklustre because of election putting breaks to investment cycles. Fiscal deficit too is at 3.4% of GDP giving thin headroom for any great fiscal impetus like lower corporate tax rates. All the recent indicators have been dismal like Unemployment rate standing at 45 year high of 7.8% in urban and 5.3% in rural in FY18, an Auto industry undergoing a 10th consecutive month of sales decline in 15.9% in April YOY worst in eight years. The only silver lining is 2.5% CPI and crude prices in the desirable range which shall enable the MPC to undertake aggressive rate cuts to the tune of at least 50BPS to boost the investment cycle, consumer spending and revive the economy.”

Standing in sync with relators views Dr. Niranjan Hiranandani, National President, NAREDCO and CMD, Hiranandani Group said, "Today, with the ever-growing economies, the doctrine of Sustainable Development becomes the most relevant principle. It is about the development that meets the needs of the present, without compromising the ability of future generations to meet their own needs. It is about providing an eco-system that works in the direction to reduce pollution for a better quality of air, soil and water. It’s about creating a space that emphasizes on more efficient use of energy, space arrangement to meet the maximum need of humankind, providing pleasant as well as healthy living & working spaces and meanwhile creating a positive impact on the environment. One can only achieve these if it is enforced right from the concept and planning process. It goes on through the under-construction process where one needs to ensure the least damage to the environment and safeguard usage of locally sourced material as far as possible."