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How to Control Real Estate Prices in a Regime of Rising Civil Construction Cost

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Third-largest sector to bring about economic growth, the real estate industry in India is expected to continue its upward trajectory in 2022. It is expected that Indian real estate sector will reach a market size of $1 trillion by 2030 and will account for 13 per cent of India’s GDP by 2025.A number of initiatives have been undertaken by the Government of India with the hope of incentivizing real estate purchases. Current trend in real estate construction cost Real estate companies are regaining their pricing power as the stock of unsold houses trends down and building costs, mainly steel and cement, keep climbing. The industry has been petitioning GoI to regulate prices, reduce taxes and allow easier imports of chief construction materials. Now, the leading developers have begun to pass the added costs on to buyers, in some cases by up to 10% of the price of a house, and they are not reporting any adverse effect on sales. The surge in oil prices, once GoI permits its pass-through to...
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Jharkhand Eying to Attract Big Ticket Investments for Job Creation for Local Workers

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Present state of the locals Construction and manufacturing all over India are usually manned by the skilled and unskilled workers mostly from Jharkhand, Bihar etc. Labour from these states migrate to various places in India for work in projects through different small contractors. With opening up of private capex spending, many projects are coming up in Jhacivil construction, Mechanical fabrication, mechanical erection, machining, piping fabrication, piping erection, electrical erection, electrical testing, C & I erection, C & I testing, mechanical painting and structural painting etcrkhand nowadays and job opportunities are increasing for local workers to work in their home state under small contractors. Present initiatives in Jharkhand The government is e yeing to attract big-ticket investments and make Jharkhand a leading hub for manufacturing of electric vehicles, among others, had offered sops and facilities to mega industrial players including Tatas, Vedanta, SAIL, ...
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Realty Sector Boom is Heading for a Best of Time for Civil Construction Contractors in India

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Realty sector today Housing affordability, liquidity conditions led by record-low interest rates and the desire amongst prospective home buyers have never been at the levels being witnessed at present across India. Right now, there is a lot of optimism in on the potential of housing and real estate sector in India. The Indian real estate market is on the cusp of a new growth cycle and it is important that all in the industry particularly the civil construction contractors in realty industry must make the best of it. In India, the inherent housing demand remains immense and concerted efforts have been made to ensure supply at the right price points to meet the needs of various income groups. The present housing boom is attributable to the measures of central and state governments’ efforts to focus on enabling policies for the housing sector including continued fiscal incentives, Pradhan Mantri AwasYojana, Credit Linked Subsidy Scheme (CLSS), concessional stamp duties, premium reductio...
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Mismatch in Skill Requirement & Availability: Forward Path for Engineering & Construction Industry?

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Present scenario The pandemic-induced lockdown had resulted in mass reverse migration of labour to their hometowns and crippled project execution on site by the Engineering and Construction industry players in India. While many of the workers have returned in the last few months and activities have picked up at projects, but many workers skilled in civil construction, mechanical fabrication and erection, operation and maintenance (O & M), machining, piping fabrication and erection, electrical erection, testing & commissioning, C & I erection, testing and commissioning, civil, mechanical and structural painting are still afraid to go away from home for work. The leaders in Construction and Engineering Industry today may be having few Lakhs of workers already mobilised and working at sites all over India but the mix of skill sets is still a challenge because not everybody is capable of doing the kind of work that is required on a given site. Thus many of them are facing mis...
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Infrastructure Push to Employment Creation & Problems Faced by Small Contractors

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Who are small contractors? A company delivering works & services in construction & manufacturing industry , with limited resources, usually as a sole proprietorship or simple partnership, the owner manages most of the company's key activities is a small contractor. A small contractor usually do not employ qualified personnel and the promoter is too busy with the problems of getting jobs, following up purchases of materials, supervising work on site, following up the processing of payments etc. Most small contractors prefer to maintain tight control of all aspects of the company’s operations, especially where this involves monetary transactions such as negotiating with potential clients or suppliers, or purchasing of materials.  Advantages of small contractors The construction industry is an important source of employment in India. It accounts for about 8 % of the total employment. Construction typically contributes 5 % to 9 % to GDP in India and provides backward and...
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Multiple Contracts on L& T Ltd will Benefit Many Small Construction Contractors in India

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Award of Infrastructure Projects on L & T Ltd Government of India (GOI), in the recent past, have awarded many large projects on Larsen & Toubro Ltd (L & T). As a leader in Infrastructure construction L & T won number of projects. Infrastructure company Larsen & Toubro (L&T) on said recently that its construction arm has bagged 'significant' orders across various business segments in the domestic and international market. The company did not provide the value of the contracts, but said the orders fall under the "significant" category, which ranges between Rs 1,000 crore and Rs 2,500 crore, according to the classification of contracts. The construction company has won a slew of orders in India and abroad for its various businesses," the company said in a statement. The company's buildings and factories business has secured an order to construct multi-level parking and advocates chambers for the High Court at Allahabad, it said. The pr...
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Advance Payouts and Flight Tickets to Get Migrant Labour Back to Construction Projects

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  Many EPC (Engineering, Procurement & Construction) Companies and contractors of different Construction Projects are offering incentives, paying in advance and booking flight tickets to get migrant Contractors and labourers back to work, in response to the shortage of workforce in the construction sector today post Covid 2 nd wave in India. This segment of economy was largely hit due to the Covid-19 induced lockdown/restrictions in different states with a huge number of migrant workers leaving the city for the fear of coronavirus 2 nd wave in April and May this year. Although many of them are returning to the projects now, but it is happening in a staggered manner. At many project site, the number of workers is near to what it was prior to the lockdown but at places construction work is going on with half the required labours. The work resumed in June after a gap of two months, with lesser number of workers. But the workforce is slowly getting back as the fear of the vir...
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