Real estate developers in Kolkata have made a strong appeal to the central government. They want the upcoming Union Budget to adjust housing policies. These changes should reflect the sharp increase in land and construction costs. The industry is pushing for higher tax benefits for homebuyers. They also demand a long-awaited revision of the affordable housing definition. These steps aim to revive demand, particularly in the mid-income segment.
Budget Expectations for February 1
The Union Budget is scheduled for presentation on February 1. Industry players believe specific measures can make a significant difference. Revisiting price caps for affordable homes is a key request. Rationalizing GST on under-construction properties is another priority. Simplifying approval processes could also boost affordability and sales momentum.
Industry Leaders Voice Their Concerns
Sushil Mohta, president of CREDAI West Bengal and chairman of Merlin Group, emphasized the need for reforms. He stated that policies must align with current market realities. "Revisiting the affordable housing definition is crucial," Mohta explained. "Rationalizing housing loan interest deductions and streamlining GST rates will improve affordability. This is especially important for middle-income homebuyers." He added that a policy push for rental housing is essential. Wider access to formal housing finance is also critical amid rapid urbanization.
Mahesh Agarwal, managing director of Purti Realty, highlighted the importance of continued policy support. Tax rationalization and infrastructure spending remain vital, he noted. "A re-evaluation of affordable housing price limits is necessary," Agarwal said. "This must align with rising land and construction costs. Adjustments to GST on under-construction property will enhance affordability." He stressed that simpler tax frameworks would help. Incentives for first-time buyers could stabilize the market and speed up project execution.
Addressing Construction Cost Increases
Saket Mohta, managing director of Merlin Group, echoed similar concerns. He pointed to sharp increases in construction costs since GST's introduction in 2017. This underscores the need for further rationalization. Mohta called for raising the affordable housing price cap. He suggested an increase from Rs 45 lakh to around Rs 80–90 lakh. Expanding unit size norms is also important. "Mid-income housing will be the key demand driver going into 2026," he stated. "Supportive tax and policy measures are essential to sustain growth."
Arya Sumant, managing director of Eden Realty, discussed the Budget's balancing act. It must strike a balance between fiscal discipline and growth-oriented reforms. "Higher home loan interest deductions for mid-income and first-time buyers are needed," Sumant said. "An updated affordable housing definition and GST rationalization are vital. Faster approvals will improve project viability and speed-to-market." He added that sustained urban infrastructure investment would unlock demand. This applies to both residential and commercial segments.
Focus on Integrated Developments
Sahil Saharia, CEO of Bengal Shristi Infrastructure Development Ltd, proposed a shift in policy focus. It should move towards large, integrated developments. "Support for mixed-use townships is important," Saharia noted. "Rental housing and commercial hubs need attention. Faster clearances and digital single-window mechanisms can help. These measures create self-sustained urban ecosystems. They also improve execution efficiency."
Restoring Confidence and Ensuring Growth
Developers across Kolkata agree on one point. Clear and stable policy signals in the Budget are essential. These signals could help restore homebuyer confidence. They might attract long-term capital. Most importantly, they can ensure sustainable growth for the real estate sector in eastern India. The industry awaits the Budget with hope for meaningful reforms.
