The 2023 G20 New Delhi summit led by Indian Prime Minister Narendra Modi, will be held on September 9-10, and is set to transform different sectors of India. One of the sectors that stand out is the real estate industry. The article we'll examine in depth how the expansive G20 agenda could change the real estate landscape in India.
Table of Contents
1. The G20 New Delhi Summit: A Transformational Event
2. Possible Impacts on Real Estate:
A. Green Development, Climate Finance & LiFE
B. Accelerated, Inclusive & Resilient Growth
C. Technological Transformation & Digital Public Infrastructure
3. Real Estate's Role in India's G20 Presidency
A. Financing Tomorrow's Cities
B. Energy Transition
C. Health Care Infrastructure
4. ADB's Support for India's G20 Presidency and Real Estate
5. A Transformative Era for India's Real Estate
In 2023, the G20 New Delhi Summit has an important historical moment as it is the first G20 summit to be held by India as well as South Asia. With India as the leader, the summit has established high-level goals that span across the globe. Although all of these goals are of significance, we will put the spotlight on the most important areas that could affect India's real estate industry dramatically.
The commitment of India to sustainable development as well as climate financing is directly affecting the real estate market. As the climate change issues grow increasing demand for eco-friendly and energy-efficient constructions is increasing. Real estate developers are increasingly adopting green building practices as well as renewable energy options. The Indian Green Building Council (IGBC) says that Green buildings can conserve potable water up to an extent of 30 to 50%.
Inclusive growth, which is a key component of India's G20 agenda, is reflected in solving the housing needs of different income classes. The government's "Housing for All" initiative has already led to affordable housing initiatives. the emphasis on inclusion could increase the growth of the real estate market, especially in the segment of affordable housing. According to a study by ANAROCK, the urban housing shortage in India is expected to be around 38 million by 2030.
India's drive for technological advancement coincides with Proptech (property technology) revolution that is taking place in the real estate market. The use of digital platforms and tools, like virtual tours of properties as well as blockchain for property transactions, as well as AI-driven property management is changing the way that real estate operates. According to an industry expert analysis, the second largest Proptech market within APAC is India which has Proptech investment of $9.1 billion in 2022.
As India concentrates on making its cities the engine of economic development, real estate is taking the lead in urban development. The need to upgrade infrastructure, reliable water supply, efficient waste management and affordable housing open the door to possibilities for real estate investments. Based on estimates India will require around $5.5 trillion of urban infrastructure investment in the next 15 years.
The commitment of India to a fair shift to renewable sources of energy provides an enormous opportunity for real estate. Renewable energy projects that use solar energy, green certifications and energy-efficient buildings are becoming more important. By 2021 India was the 4th highest installed solar capacity in the world and the capacity of solar power has been estimated at 61.97 GW as of 30th November 2022.
The pandemic highlighted the importance of having a strong healthcare infrastructure. Healthcare centers and hospitals are rising and directly impact the real estate market. The medical infrastructure is changing to accommodate the needs of top-quality healthcare, creating opportunities that real estate professionals can develop working in this field.
The Asian Development Bank (ADB) is actively supporting India's G20 Presidency in areas closely related to real estate. For instance, ADB's assistance in transforming cities into "Cities of Tomorrow" focuses on climate-resilient urban planning, which inherently involves real estate development.
With a focus on sustainability, inclusion, and advancement in technology real estate investors and developers will play a major role in shaping the direction of India's growing urbanization. As these objectives become tangible initiatives, the real estate market in India will transform dramatically, bringing many opportunities for expansion and growth.
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