(a) whether Government is contemplating to give its approval to hundred percent foreign investment in the development of housing sector;
(b) if so, the details thereof;
(c) whether foreign investment has been invited for housing development in all big and small cities of the country;
(d) if so, the name of the cities in which this investment is likely to be made;
(e) whether other basic infrastructure is also to be developed by housing companies; and
(f) if so, the details thereof?
MINISTER OF STATE IN THE MINISTRY OF HOUSING & URBAN POVERTY
ALLEVIATION ( KUMARI SELJA )
(a)to(f): As per extant policy Foreign Direct Investment (FDI)
upto 100% under the automatic route is allowed for construction
development projects, including housing commercial premises,
resorts, educational institutions, recreational facilities, city
and regional level infrastructure township, subject to
conditions laid down in Press Note No.2 (2005 Series) (annexed).
ANNEXURE
ANNEXURE REFERRED TO IN REPLY TO LOK SABHA USQ NO.3550 FOR 7.9.2007.
Government of India
Ministry of Commerce & Industry
Department of Industrial Policy & Promotion
SIA (FC Division)
Press Note No.2 (2005 Series)
Sub: Foreign Direct Investment (FDI) in townships, housing,
built-up infrastructure and construction development
projects.
With a view to catalysing investment in townships,
housing, built-up infrastructure and construction development
projects as an instrument to generate economic activity, create
new employment opportunities and add to the available housing
stock and built-up infrastructure, the Government has decided to
allow FDI up to 100% under the automatic route in townships,
housing, built-up infrastructure and construction development
projects (which would include, but not be restricted to,
housing, commercial premises, hotels, resorts, hospitals,
educational institutions, recreational facilities, city and
regional level infrastructure), subject to the following
guidelines:
(a) Minimum area to be developed under each project would be as
under:
(i) In case of development of serviced housing plots, a
minimum land area of 10 hectares.
(ii) In case of construction development projects, a minimum
built up area of 50,000 sq.mts.
(iii) In case of a combination project, anyone of the above two
conditions would suffice.
(b) The investment would further be subject to the following
conditions:
(i) Minimum capitalization of US$10 million for wholly owned
subsidiaries and US$5 million for joint ventures with
Indian partners. The funds would have to be brought in
within six months of commencement of business of the
Company.
(ii) Original investment cannot be repatriated before a period
of three years from completion of minimum capitalization.
However, the investor may be permitted to exit earlier
with prior approval of the Government through the FIPB.
(c) At least 50% of the project must be developed within a
period of five years from the date of obtaining all statutory
clearances. The investor would not be permitted to sell
undeveloped plots.
For the purpose of these guidelines, `undeveloped plots`
will mean where roads, water supply, street lighting, drainage,
sewerage and other conveniences, as applicable under prescribed
regulations, have not been made available. It will be necessary
that the investor provides this infrastructure and obtain the
completion certificate from the concerned local body/ service
agency before he would be allowed to dispose of serviced housing
plots.
(d) The project shall conform to the norms and standards,
including land use requirements and provision of community
amenities and common facilities, as laid down in the applicable
building control regulations, bye-laws, rules, and other
regulations of the State Government! Municipal / Local Body
concerned.
(e) The investor shall be responsible for obtaining all
necessary approvals, including those of the building/layout
plans, developing internal and peripheral areas and other
infrastructure facilities, payment of development, external
development and other charges and complying with all other
requirements as prescribed under applicable rules/ bye-laws/
regulations of the State Government! Municipal/ Local Body
concerned.
(f) The State Government / Municipal Local Body concerned, which
approves the building/ development plans, would monitor
compliance of the above conditions by the developer.`
2. Para (iv) of Press Note 4(2001 Series), issued by the
Government on 21.5.2001, and Press Note 3 (2002 Series), issued
on 4.1.2002, stand superseded.
(Umesh Kumar)
Joint Secretary to the Government of India
F.No.5(6)/2000-FC
Dated 3rd March, 2005