New Delhi- The real estate sector is one of the major contributors to revenue of states and UTs, which collected an estimated Rs 2 lakh crore during last fiscal year in various forms, including stamp duties, according to a Naredco-Knight Frank India report.
This is equivalent to 5.4 per cent of the total revenue collected by all states and UTs in India during 2022-23, it added.
“Real estate sector is one of the key contributors to the revenue of state governments. In FY 2022-23, an estimated Rs 2 trillion was collected by all states and UTs (Union Territories) in India from stamp duties, registration fees and land revenue,” the report said.
Realtors’ body Naredco and property consultant Knight Frank India recently released a report ‘India Real Estate: Vision 2047’.
As per the projection of the report, the size of the Indian real estate sector is estimated to jump more than 12-fold to USD 5.8 trillion by 2047 from USD 477 billion last year. The sector will contribute over 15 per cent to the total economic output of the country in 2047 from an existing share of 7.3 per cent.
By 2047, when India reaches 100 years of independence, the size of the economy is estimated to be USD 33-40 trillion. For study purposes, Knight Frank has taken the mean estimated growth of the Indian economy at USD 36.4 trillion by 2047.
As per the report, the size of the residential real estate market is estimated to grow to USD 3.5 trillion (USD 3,500 billion) in 2047 from USD 299 billion last year.
The size of the office real estate market is likely to grow to USD 473 billion from USD 40 billion, while the warehousing market is expected to reach USD 34 billion from USD 2.9 billion.
In addition to state revenues, the report noted that the real estate sector has also evolved as a tool for financing infrastructure development in the country.
“Mechanisms like value capture financing have enabled state governments and municipalities to raise financial resources by tapping into the increase in value of real estate properties and land resulting from government investments and policy initiatives.
“On various instances, value capture financing tools such as land value tax, betterment levy, development charges, transfer of development rights (TDRs) etc have enabled the generation of additional revenues which has further been used for funding infrastructure development of the cities,” the report said.
