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Journalism of Courage
The recent budget attempted to give a major boost to the housing sector. Finance Minister Yashwant Sinha had stated in his budget speech that he hoped his comprehensive package of fiscal incentives would benefit the middle class investor wishing to purchase a dwelling unit as well as promoters of middle class housing projects and housing finance companies. Sinha also hoped that his package would be a powerful force for the revival of the entire economy, since the construction sector had very strong linkages with other sectors like steel and cement, that stood in great need of measures to revive them. The consequent upsurge in building activity, he had hoped, would not only increase housing stock but would generally provide a much needed fillip to industry. Recently, Union Urban Affairs Minister Ram Jethmalani proposed some measures to provide more direction to this process of liberalising the housing sector.
According to the budget, the ceiling on built up area that would enjoy a tax holiday, was to beincreased from 1,000 sq ft to 1,500 sq ft, for all places except those which fell within 25 km of the municipal limits of Delhi and Mumbai. Jethmalani suggests that this new ceiling be extended to all regions apart from those which fell within the municipal limits of the two metropolises. And while the earlier proposal imposed the rather unfeasible condition that work on the projects should be completed by the year 200l, Jethmalani has rightly suggested that the deadline be extended to the year 2010. Further, the increase to 40 per cent in the depreciation rate on new dwelling units purchased by the business sector for its employees is now sought, by Jethmalani, to be extended to partnership firms and professional bodies too. None of these would represent a radical shift from the lines proposed in Yashwant Sinha8217;s own budget. They represent merely an attempt to rationalise the earlier proposals and Sinha should not find himself in any disagreement with them.
While both Houses of Parliament had passed the amendments to this Act, and the President had given his assent to them, Delhi8217;s traders took to the streets last year to ensure that it was not notified. As a result, people owning property worth crores continue to get rents of Rs 100 and 150. If this isn8217;t a gross miscarriage of justice, what is? Where then is the incentive to invest in property? If the idea is to ease housing shortages in the bigger cities and make the housingsector more productive, the urban affairs minister8217;s recent proposals are to be commended. But is his government listening?
