New Delhi [India], Apr. 9 : A study conducted by ASSOCHAM revealed that as many as 826 housing projects are running behind schedule by an average of 39 months.
At the end of December 2016, 3511 projects were facilitated in the construction and real estate sector, of which 2304 were under the implementation stage.
Out of these, 886 construction and real estate projects are experiencing significant delays, with 826 delayed projects from the housing construction and 60 from the commercial complex.
Among the major states, Punjab has recorded the maximum delay of 48 months in construction and real estate projects followed by Telangana (45 months), West Bengal (44 months), Odisha (44 months) and Haryana (44 months), the study noted.
While Maharashtra witnessed a delay of 39 months, Karnataka has recorded lowest delay of 31 months. A similar delay was also noted in Rajasthan, Kerala, Gujarat and Tamil Nadu, the chamber claimed. "With steps like banks being allowed by the Reserve Bank of India (RBI) to invest in Real Estate Investment Trusts (REITs), the sector should see revival of investment, enabling it to cut delays and restore consumer confidence," said D S Rawat, Secretary General, ASSOCHAM.
An ownership analysis of the delayed projects suggests that public and private sector projects have almost similar kind of delays.
Public sector projects are delayed by 39.03 months and private sector by 39.63 months. The real estate and housing sector is battling several problems. The process of obtaining mandatory approvals from multiple regulators and authorities result in cost and time overruns.
These delays not only discourage investments in the housing sector but also lead to delays and corruption.
As an effective solution, the centre and state governments must introduce a single-window system for clearance of all real estate projects.
The chamber further emphasised on the need for the government to act as a facilitator, rather than a regulator, of the real estate projects, particularly where demand is more than supply.
State governments should digitise their land records. In coordination with the state and local authorities, basic infrastructure like transport, water, power, housing, healthcare and sanitation must be taken up well before the completion of the projects.