Lending to Real Estate Sector gets Expensive

RBI today hiked the repo rate by 0.25% . This is unlikely to hurt banks lending in normal capacity. However, if banks overstretch, then they have to borrow from RBI which will be 0.25% higher.

In the monetary policy review today, RBI raised the repo rate, the rate at which it lends to banks, by 25 bps to 7.25% while keeping the reverse repo, the rate at which it borrows from banks, unchanged at 6%.

"Banks having liquidity problems may charge a higher price for Personal, Real Estate and Equity Market loans," Allen Pereira, executive director of Oriental Bank of Commerce, told PTI.

K Raghuraman, executive director of Punjab National Bank, said RBI's repo rate hike is a caution on credit growth, specially for banks who are aggressive in the market.

The Land Sharks of corporate India will find it tough to borrow for their shady Land Bank deals. Good Job Done, Dr Y V Reddy! We don't want a Japan like situation in India where the collapse of the Japanese Real Estate market led to the collapse of their Banking System and then their entire economy in 90s.

Sitaram for Chinese Model of SEZs in India

We were the first in the world to compare and contrast the difference in SEZ act between China and India late last month. Sitaram Yechury, Leader of CPI visited China last week to study why SEZs were successful in China and has said the same words we did.

Sitaram calls for separate tracts of lands to be owned by government and infrastructure be developed in those areas then inviting Foreign and Indian industrialists to setup their manufacturing base. Instead what has now happened is the corrupt governments of Mahrashtra and Andhra Pradesh have acted on behalf of corporate India killing the poor Indian farmer. Without citing the name of Mukesh Ambani, Sitaram said, "If a private company gets to own 10,000 hectares of land, we are re-inviting Zamindari system 60 years after independence".

Mukesh spoke of big plans at World Economic Forum in Davos, and why has he become a Land Shark rather than being an industrialist ? The days of getting rich by corrupt means by bribing hands of Netas and Babus are behind us. Wake up Land Sharks, go manufacture :-)

Hewlett-Packard Company surrenders SEZ license in India.

Right from day one, I have shouted at the top of my voice that SEZ act in its current state was a land grabbing act and was against industrialization. When they talk about modifications to the act to bring transperency in deals, State Governmnts have become the corrupt agents between corporates and the land owners, mostly farmers.

Some ethical managements don't like such business practices and have put a hold on their SEZ plans. Silicon Valley giant, Hewlett-Packard Company today surrendered its IT SEZ license back to the commerce ministry. HP India had got an approval in June this year to start an SEZ in Bangalore. HP had thought of a mega 1 Million SFT IT park but the project was simply not viable.

In an interview to CNBC TV 18 today, G K Pillai the Commerce Secretary and optimistic man behind SEZs has said 25% of the SEZs will fail to take-off and they may surrender their licenses. The SEZ shake-out has begun lets see who will survive.

Related Stories:
RBI Concerned over SEZ Policy.
Best Policy is not to have any SEZ
Special or Scam Economy Zones of India

Jaaydaad.Com introduces Real Estate Retailing in India

After Pantaloon Retail India Limited and failed dreams of Reliance Retail, Global Infocomm has ventured into organized retailing of Real Estate in India.

Global Infocomm, is planning to open 600 showrooms with a PAN-India presence. The company is launching from Uttar Pradesh, which, is a very bad move considering the law and order and backwardness of the state. They should have started from Maharashtra or Karnataka the most sought after states for urban development these days.

The company also has a B2C portal JaayDaad.Com. The portal enables you to BUY, SELL or Rent properties immediately but I didn't find much listings as their are on 99Acres.com.

Mega Real Estate Deals Hit Indian Real Estate

With the beginning or operation Land Grabbing by Real Estate land sharks in India, greedy banks and financial institutions from all over the world have joined the bandwagon to finance these mega real estate deals.

After George Soros' Quantum Fund picking up stake in Anant Raj Industries, CitiBank has bought 5.75% stake in Ansal Properties and infrastructures Limited. UK based Trinity Fund has bought a whopping 16% stake in Kapstone Corporation. The Citibank deal is valued at Rs175 crores. Ansal Properties and Infrastructure Limited will issue preferential shares at price of Rs610 on Face Value of Rs5. The Trinity Kapstone deal is valued at Rs85 crores.

Operation Land Grab begins in Andhra Pradesh

The picture on your left shows a piece of agricultural land in Rambilli Mandal in Vishakapatnam which has been acquired for a multi-product SEZ by the corrupt state government of Andhra Pradesh on behalf of SRF Limited the promoter of SEZ. The SEZ is 1040 hectares in size.



This piece of fertile land is in Ravivaripodu village of Kakinada in Andhra Pradesh. Farmers want to know how they have been getting good yield for years if the farmland was 'dry' ?

The State government has manipulated land records and has marked fertile agricultural lands as dry and arid lands unfit for agriculture so that they can grab it at throw away price. [Via MM]

Govt BANS pre-launch offers on Homes.

The Union Urban Development Ministry has finally woken up to the woes of large number of Middle Class Indians taken for a ride by Shady Builders and Real Estate Developers.

What non-reputed builders usually do is, collect large sums of money as advance and use the money for their own purpose or divert it to other projects. Also the greedy real estate brokers in order to make quick bucks has become a speculator who keeps trading in pre-launch offers. To curb all such ir-regularities, the government has proposed a bill which will put an end to this. A clear-cut date of completion will obviate the scope for speculation.

Sanjay Verma MD of Cushan and Wakefield said that,
"A lot of speculative buying and selling had been taking place in the pre-launch residential business. This high level of continued speculative buying has put certain degree of selling pressure in the market. Therefore, the move to curb pre-launch mechanism will provide for a healthy & stable growth for the realty sector in the coming years".

Hopefully the Babus and Netas who are also part of the Land Bank Scam will protect the middle class interest. Via ET

DLF to reissue debentures to small investors

Earlier in August we had exposed the DLF Debenture and IPO scam on our blog here. DLF, the New delhi based Real Estate company has agreed to re-issue debentures to small investors who were cheated in the earlier issue.

The company has called for a EGM to approve the issue for small investors who were earlier cheated by the greedy management of DLF and its shady promoters. This is all a makeup before its $2 Billion IPO which they want to go for. Investors kindly be aware of this shady real estate company.