To attract more foreign investment in construction and real estate sector Indian Govt plans to relaxing foreign direct investment (FDI) norms in construction sector. Proposed to bring down the minimum built-up area requirement for FDI in construction projects from 50,000 sq. metres to 20,000 sq. metres and reducing the minimum capital requirement for such projects from $10 million to $5 million.
100% foreign direct investment is allowed in townships, housing and built-up infrastructure and construction developments with some conditions. Earlier Finance Minister had also said that projects which commit at least 30% of the total project cost for low cost affordable housing would be exempted from minimum built up area and capitalisation requirements, with the condition of 3 year lock-in.