Delayed policy execution discourages investment, says NAREDCO chief

Indore: Delays in implementing urban development policies are slowing growth and discouraging private investment, NAREDCO Chairman Dr Niranjan Hiranandani said during an interaction here on Friday, flagging gaps in master planning and stamp duty structures in Madhya Pradesh."If you pass policies but execute them late, development will be delayed and investment will be discouraged," Hiranandani said, adding that uncertainty in planning frameworks directly impacts capital flows into real estate and infrastructure.
He pointed out that Bhopal's Development Plan period ended in 2005 and a revised plan is still awaited. Indore's master plan, too, expired in 2021. "There is a lacuna here. Indore does not have an updated plan for the last 5 years and Bhopal's is delayed by nearly 18 years. If policies are implemented late, development will be delayed. Policies should be implemented on time if you want investment, employment generation and growth," he said.Drawing a comparison with Maharashtra, Hiranandani said cities such as Mumbai and Pune have updated Development Control and Regulation frameworks. "Every city in Maharashtra has a DCR, updated to date. In Mumbai, policies like TDR, slum redevelopment and commercial development under initiatives such as Mumbai 3.0 helped attract nearly 200 new developers in the last 3 years from Delhi, MP, Bengaluru and Chennai," he said.He stressed that timely execution, not merely policy announcements, determines investment momentum. "We should not fail because of lack of action. Policies are already there. Timely implementation will help the state," he said.On taxation, Hiranandani termed Madhya Pradesh's stamp duty rate of 12.5 per cent as the highest in the country. "You collect less than many other states despite having the highest stamp duty. If MP reduces it to around 6 per cent, collections could double because transactions will increase," he said.He added that the Pradhan Mantri Awas Yojana mandates lower stamp duty to enable private sector participation. "How do you expect PM Awas Yojana to get a boost in MP when stamp duty is the highest in the country?" he asked.Hiranandani said housing and land remain state subjects and state govts play a decisive role in shaping urban growth. "Urban growth will drive India's growth. Employment generation can be multiplied only through the expansion of Tier 1, Tier 2 and Tier 3 cities. States have to prioritise city master plans and provide regulatory clarity," he said.On regulatory reforms, he said RERA benefited homebuyers significantly, though its implementation varies across states. "The law is good. Some weaknesses may exist in implementation in certain states, but RERA brought transparency," he said.He also flagged planning constraints in Indore, noting that a maximum floor area ratio of 1:2 in the planning area restricts supply. "With rising land costs, low FAR limits housing supply and increases prices. This directly impacts affordability in a high-growth Tier-2 city like Indore," he said."I am concerned to see that a state which can do so much is not doing enough. I am not saying MP is not doing anything, but there is scope to improve further in real estate and urban planning," he added.