Mr. Rohtas Goel comment on Union Budget 2012

“The raising of exemption limit to Rs 2 lakh is a welcome sign in such times of high inflation. However, the mood of real estate sector remains largely status quo with no major announcement for the sector. Affordable housing has been stressed upon in the Budget. The allowance of external commercial borrowings (ECB) for low cost affordable housing projects will lower interest cost for developers. In order to ease liquidity, the Government has also reduced Withholding tax on ECBs for affordable housing from 20% to 5% for 3 years. Besides, 1% interest rate subsidy provided last year for loans towards affordable housing continues this year. In fact, what nullifies the above positivity is an increase in service tax and excise duty to 12 per cent each resulting in an increase in cost of raw material. None of the measures announced today will help in bridging the housing shortage in the country.”