Back to Growth: Interview with Vinamra Srivastava, CEO, Business Parks, Capitaland India
1. How do you see the major trends witnessed since Covid-19 in your sector pan out in 2021? Has the pandemic fundamentally changed the sector’s position in India? Or will there be a return to a pre-Covid “normal?”
Different asset classes of the real estate sector have been impacted differently because of Covid-19. While logistics and data centres got a positive boost and office and business parks remained fairly steady, retail, residential and hospitality have struggled tremendously. Even so, with the rebound in the macro-economy and the vaccine rollout, we are confident that the sector will return to pre-Covid levels in the next one or two years. At the same time, each asset class may face a new 'normal' in terms of customer requirements and business models.
2. What are your expectations for the sector in 2021? Do you foresee a period of job creation across the country?
The announcement of strong results from some of the leading Indian IT companies is an indicator that the IT services sectors will lead growth and job creation in the country in 2021. We believe the services sector, in particular, will see job creation as businesses start getting back to full capacity in 2021. Depending on the country’s ability to attracting manufacturers through the right incentives, we are hopeful of a manufacturing rebound as well.
3. What could be your strategy to boost aggregate demand in the sector going ahead into 2021?
Focus on keeping business models flexible to meet customers’ fast changing requirements will be key.
4. In your opinion, is India a lucrative destination for foreign investors? How have the pre-existing trends in infrastructure development been altered with the events of last year? How does India’s change in focus to becoming a manufacturing hub help the construction sector and its prospects in India?
India will remain a lucrative destination for foreign investors on the back of strong domestic demand driven by the large—and growing—middle-class population. The construction/real estate sector will benefit from new industries being set up in the country as it will boost capacity creation across the entire supply chain.
5. How have sector specific reforms (IBC, PLI, labour law reforms) by the government helped the sector thrive and remain resilient during the ongoing pandemic?
Policy reforms in the areas of short/medium term fiscal incentives in some geographies are now helping the sector get back on its feet. The government should consider more such incentives across different states to further boost consumption.
6. Going ahead, what are the three most important things that you would want in budget 2021 for your sector?
1. Availing input tax credit on procurement of goods/services used for construction of real estate intended for commercial leasing.
2. Simplifying and quickening the process of denotification of operational SEZs post the sunset clause.
3. Simplifying the SEZ compliance procedures for occupiers.
* The views and opinions expressed above are solely of the interviewee. The content does not reflect Invest India's position or opinion and Invest India bears no responsibility for the same.