Mumbai, June 17 (IANS) India's markets regulator on Friday said it proposes to relax the norms for real estate investment trusts, including allowing them to invest up to 20 per cent in a property under construction.
It has, accordingly, floated a consultation paper inviting comments from stakeholders.
In a release replete with jargon issued on Friday, the Securities and Exchange Board of India (SEBI) said it proposes to align minimum public holding in such funds requirement with SCRR -- an abbreviation for Securities Contract Regulation Rules.
The proposals are intended to attract domestic and foreign investment to the funds-starved realty industry in India, that is facing the dual dilemma of low demand and high inventories in real estate -- some of which are languishing due to paucity of money.
In his budget speech in February, Finance Minister Arun Jaitley has said measures will follow on affordable housing.
"I propose that any distribution made out of income of SPV (special purpose vehicles, or holding companies) to the real estate investment trusts infrastructure investment trusts having specified shareholding will not be subjected to dividend distribution tax," he said.
Realty trusts generally enable developers to raise funds by selling completed buildings to investors and listing them as a trust, they are listed entities which invest in retail assets and leased office.
