India’s $2 trillion economy has been thirsting for more foreign direct investment across several sectors. For many global fund managers and institutional investors, being part of growth for an economy that is growing at over 7 per cent is a mouthwatering opportunity.

Since several areas of infrastructure have not matched the pace of growth for India, there is a strong need for a policy that can drive the pace of infrastructure growth. That includes the growth in the real estate sector, which could, in turn, stoke growth across consumer goods industries.

Foreign Direct Investment (FDI) in India is only permitted in construction and development activity. Hence, there are scores of examples of investors having bought equity stake in projects that are at different stages of construction. Global investors perhaps are a little apprehensive of the complex rules regarding real estate and hence do not want to take a risk.

But to get more capital there are some fundamental changes in approach that may be needed. Investors are looking for security and a certainty about Government policies while promoters are looking for partnerships, liquidity and the best returns.

Government policy therefore needs to marry the two with the interest of the real estate sector and the buyers.