Farook Mahmood, Chairman and Managing Director of the Bengaluru-based real estate company Silverline Group, has been elected global president of FIABCI, the International Real Estate Federation. Mahmood, who has completed various deals for multinational and domestic corporates and high net worth individuals, shares his plans as head of the federation. Excerpts:
The realty sector in India is fast undergoing regulatory changes. How does the global community, especially FIABCI members, view these changes?
The RERA Bill is a very positive law which brings in accountability to the industry.
India is opening doors to foreign investments with tax and capital gain benefits. Industry status for the realty sector is also a shot in the arm. Allowing payment of the Capital Gains Tax under Joint Development Agreement (JDA) after the project is completed is a major benefit to the developers. zTo encourage foreign investors, the government has extended the concessional tax rate of 5 per cent on interest for qualifying foreign debt from June 2017 to June 2020.
In another step, the government will grant Permanent Residency status to foreign investors who meet criteria related to minimum investment and employment generation.
The Indian economy is maturing. With increased transparency and reduced impediments for investors, the inflow of foreign funds is expected to be on an uptrend. These changes will attract investors to all segments of the industry.
What are the views of the global community and FIABCI on investing in India’s high end realty?
India is viewed as one of the top markets offering good returns especially in the commercial and retail space.
The top-end residential market in India is still nascent and we have leading developers who can do international quality construction.
If infrastructure can be improved, a lot of funds will find its way into India for people to invest in second homes in coastal areas and hill stations.
What kind of value-addition do you propose for the Indian industry?
As India opens its doors to international investments, I plan to promote India’s real estate sector at every global destination I visit.
There are big opportunities for international companies to cooperate with local outfits in ‘Housing for All’ and Smart City programmes.
Do you plan to implement any good international practices in India?
There are many good practices across the globe but may be difficult to implement in India because of various factors.
One thing good practice that I recollect is a realtor association in France offering insurance cover for all its members for up to about quarter of a million euros for any liability or misrepresentation.
This should be made mandatory for our real estate associations to protect the consumers and it is not very difficult to do so.
This will encourage property buyers to use the services of realtors as they are totally protected.