Piyush Goyal urges realtors to ensure guaranteed ESIC and PF registration for over 7 cr people employed in the sector

“I urge you to kindly think about this in very serious terms… can we ensure a guaranteed ESIC and provident fund registration of all these 70 million workmen and women (working in this sector),” Goyal told 1100 real estate developers participating at the Credai-NATCON event currently taking place in Sydney.

Ensuring guaranteed ESIC and PF registrations will ensure that the industry gets credit for the good work it is doing. “Very often that credit is found wanting because many policy makers, possibly bankers and possibly regulators, still look upon the industry with the prism of the past, and I think it’s time we change that,” said Goyal.

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He asked the CREDAI to come out with a resolution on November 25, when the association will celebrate its 25 years, after extensive stakeholder discussions with its 14,000 members.

Goyal said that guaranteed ESIC and PF registrations would ensure health coverage for people working in the sector and pension for their social security post retirement. This in turn will help boost productivity and efficiency of people working in this sector, leading to improvement in quality.

On real estate sector’s demand for financing like other industries

On Credai’s request that the sector should get financing similar to what other industries receive, he said, that the government will be happy to engage with various associations and take it up both with RBI and the finance ministry on the issues faced by the real estate developers.

“If there are any RBI problems, I’m happy to discuss it and take it up both with RBI and the finance ministry, because in some sense, as Industry Minister, you belong to me also,” Goyal said.

Import duties on construction equipment

On CREDAI President Boman Irani’s demand to reduce import duties on construction equipment, the minister suggested that the industry should rather focus on manufacturing the equipment in India.

“Why should all of these (construction equipment) not be made in India? And I am not saying assembly, Made in India. And I would urge you to come up with a list of products and potential market size. I will become your ambassador and talk to industry leaders in CII and FICCI, to all of them, to start promoting the manufacture of these products in India,” he said.

He said there is no harm in taking collaborations and technologies from abroad.

“But instead of the duties, I think let’s focus on making high quality equipment in India,” he said.

The minister, however, said the government could consider a proposal of reducing import duties for 3-4 years of the transition period with a clear roadmap that by then the Indian companies would set up manufacturing facilities of construction equipment. 

“I will be happy to reduce the duty rates for that transition period with a well defined road map – three years during which the industry will be self -sufficient in India. We will reduce the duties and then increase the duties to higher levels,” he said.

On increasing pollution levels in cities

Expressing concern over pollution levels in big cities, especially with massive construction activity being undertaken across cities, Goyal said that realtors should adopt new forms of construction technologies that are environment friendly.

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“If we were to move to steel structures and use precast equipment, just like we see in Europe, America, Dubai, Singapore and possibly even in Australia, the cost of construction may not go up very significantly, but the speed of construction will certainly go up,” he said.

This will help real estate developers to complete projects faster and also reduce interest cost.

“And with the money rotation being faster, you can do much more business for every dollar rupee that you are investing in your business, you can probably expand much more in terms of output.”

He asked builders to begin with adoption in at least 8-10 big cities in India. “And I would ideally like it to be a suo-motto industry adoption, rather than a government forced adoption,” he said.

He also asked Quality Council of India (QCI) Chairperson Jaxay Shah, who was present at the event, to work with the Bureau of Indian Standards ( BIS) to come up with new standards for the construction sector.

RERA has ensured that bankers get more confidence in financing the sector

He also said that RERA has brought in positive changes. 

“We now have a much more honest regime, and with a lot of the unscrupulous developers are now out of the system. Bankers are also getting more confidence in financing the sector,” Goyal said.

“RERA has brought about transparency… I myself incidentally have suffered when I bought my home in 2010 and when it was fully furnished at the end of 2012, I could not enter into my own home for nearly five to six years after that because it did not have an occupation certificate. That was the level of uncertainty that buyers used to face. I am delighted that RERA has changed all of this,” he said.

On approval processes

Goyal said that the ministry would like to offer its service to see how it can reduce the entire approval process, be it planning approval, building approval process, provided the sector is willing to commit to honesty and transparency.

“Finally, I can offer my services to your industry to see how we can reduce the entire approval process, planning process, building approval process, the number of approvals that you may require, the time taken for getting the permissions both at the pre construction, architectural stage and building and completion stage, if the industry forthcoming in committing to honesty,” he said.

“What Prime Minister Narendra Modi desires is ‘Na Khaunga, Na Khane Dunga’ and you all have to take a pledge that you will not try to take short cuts. If your industry is ready to work within bylaws, then I’ll associate with you and work towards it,” the minister added.