Research Scholar, Department of Commerce, DSE, University of Delhi, New Delhi, India
Online published on 14 July, 2015.
The real estate sector in India has assumed greater prominence with the liberalization of the economy, it has come a long way by becoming one of the fastest growing markets in the world. It has come to this level by way of increase in business opportunities, large population base, rising income level, labour migration which led to increase in demand for housing and commercial space. The sector comprises of four sub-sectors- housing, retail, hospitality and commercial. Out of all the sub-sectors the housing sector contributes around 5–6% of GDP, and the remaining three sectors also are growing at a rapid pace with rising infrastructural needs to be fulfilled by the real estate sector. With real estate sector playing such an instrumental role in the country's economic development, so here arises the need to look into the corporate governance framework of the real estate companies. Some of the major issues relating to real estate sector are the lack of transparency, board member's qualification, property valuation and appraisal, investor relations and corporate rating. In order to gain investor's confidence in the real estate companies, a well-defined framework of corporate governance has to be followed. This paper will look into the need for having corporate governance in realty sector and will precisely define the specific rules and regulations which should be exclusively built up for the real estate sector as it involves an investment cycle which is quite different from other normal products marketed in the country. Huge capital involvement with long investment cycles along with a lot of risks associated with it, multitude of parties is another cause of concern.
To describe the development of real estate sector of India post liberalization period.
To showcase the importance of real estate sector of India in lieu of its contribution towards the economic development of the country
To analyze critically the relevance of specific provisions especially for real estate sector for fostering a better corporate governance environment in Indian realty sector and to cater to investor's interest.
The research study is based on the information collected from various secondary sources. Articles published in leading journals, newspapers and websites have been referred to in conducting this study.
