Many greetings to all of you, young friends and senior stalwarts associated with CREDAI.
This YOUTHCON meeting is happening at a time when we move towards a new India. I’m here with you now just after the parliament session is over. Friends you all play an important role in linking the new and soaring dreams of a new India. You fulfil the dream of building a house for the common people.
CREDAI in the past two decades have been rendering its service in building houses for the citizens of India. I have been informed that you have expanded in 205 cities in 23 states, and you have over 12000 members in your organization. There has been a tremendous growth in the real estate sector in India, along with that; your organization has also grown. It gives me immense pleasure that you have started your organization with the blessings of Shri Atal Bihari Vajpayee, and have reached this level.
Shri Atal Bihari Vajpayee has set out to fulfil the dreams of urban poor and middle-class by providing housing. He started “Valmiki-Ambedkar Awas Yojana” in 2001 in Lucknow. His government opened the doors of the housing and urban development to private sector, keeping in view the necessities of the people. I think you remember this.
The present government of NDA is expanding the efforts of Atalji. Be it the middle class of the country, or the poor, by 2022, when we celebrate our 75 years of independence, every homeless will have their own house.
Today in the villages and cities of the country under the Pradhan Mantri Awas Yojana, approximately 1,50,00,000 houses have been built, out of which about 15 lakh houses have been made for the urban poor.
Whenever I state this number, our political opponent and the media ask what is new about a scheme like this. There were schemes even before. This is true, these plans used to run earlier, definitely. When it comes to Pradhan Mantri Awas Yojana and these previous housing schemes, the first difference is that of intention.
This scheme is not here as an attempt to immortalize anyone's name or to mint any coins with their names. Whoever becomes the Prime Minister will continue these schemes. Do I have to state anything? This scheme is not here to publicize any person. If you remove the name or self-interest from a scheme, then your policy becomes clear. By implementing this scheme, corruption and the feeling of mine and yours, ours and theirs is eliminated.
Now the beneficiaries are selected using the technology in a scientific way. There used to be a business of cutting or adding a name to the list run by a few people. There were big players in it. Actually more than builders, dealers used to earn more. Now that these businesses are closed, maybe there are people at loss amongst you too, but now that you have made me the Prime Minister so, what to do?
The third difference is that of quality. The goal of the houses that were built earlier was not to facilitate the people. They were built only to publicize a few names. So they built houses for namesake. Recently I was watching a TV report. I do not know if you guys have seen it or not, there is a place called Amethi in UP. Why do you mind it? I think you know more than me.
The people there have given a lot of love to the some or the other of the renowned family. People have never asked them any questions. A report from Amethi mentions about a dalit slum, where, ten years ago, the people were given houses by the government, which also advertised its name everywhere. But today the situation is such that the walls advertising their name have collapsed within ten years.
Now houses from Pradhan Mantri Awas Yojana are being built in those same settlements. These houses are bigger in size; they also have toilet, kitchen, LPG gas connection, and electricity connection. All government schemes are included in this house. The poor need not worry about applying for different schemes separately now.
The fourth difference is that of speed, and scale. In the ten years of the previous government, 13 lakh houses have been approved for the urban poor. By far in the past four and half years, 73 lakh houses have been approved, i.e., nearly six times the number. In ten years of the previous government, about 38 thousand crores for houses have been approved and in the last four and a half years almost 4 lakh crores i.e., ten times more than the previous government. Eight lakh houses were made by the previous government while we did in the last four and a half years about 15 lakh houses, that is, almost twice as much. With this speed we will have roof over every homeless by 2022.
We are not going to rest till we fulfil the dream of building houses for the poor. It’s the first time a government has worked for the sake of middle class in our country. For this we have brought and expanded CLSS (Credit Link Subsidy scheme).
Under the Pradhan Mantri Awas Yojana, for middle class families whose income is up to Rs 18 lakh every year, Home loan interest is being exempted. This has been done for the first time. Under this plan the home buyers are going to save up to six lakh rupees. Now if a middle class family can build a house and save six and a half lakh rupees in its budget, it will prove significant in their lives. We have also increased the size of LIG and MIG houses last year.
Recently, some major provisions have been made in the budget using which the young middle class will be able to fulfill his/her dream of building a house. Tax has been reduced to zero on taxable income up to Rs 5 lakh. The younger middle class will be more encouraged to buy your house at the beginning of their career. The government bears the tax losses but you have benefited. Claps are not loud enough. I’ll put it in simpler terms. The amount the middle class saves, will be put into building a house which in turn will fill your pockets.
Earlier, tax was not deducted on rent up to 1 lakh 80 thousand. But now it’s been increased to 2 lakh 40 thousand. Claps are not loud enough again. Because you didn't understand, no one has explained to you how much this budget has given to the housing industry. For this, the Prime Minister has to explain himself. Now see, if one will be counted as tax free on rent, then he would build a new house, building more houses and renting them will become a part of a business. So, Who will build the house, who will build it, who will buy that house, will they buy from Modi?.Well I met you guys… Otherwise I believed that everyone understood my budget. We used to have tough time in parliament explaining. Looking at the needs of a family, if two houses had to be purchased, they had to pay tax on the estimated rent. Now income tax is canceled on that. Don't you know what that means? You only know what happened to GST, you are stuck on the topic of GST.
In the same way, people who sell their old house, they can buy two small new houses in exchange for price. There is a huge relief in tax for them. Now people can save upon capital gains tax. You can invest the money received from the sale of two houses instead of one. Now it's your job to explain it to people with Bungalows and with flat schemes. You don’t have to pay me any tax for this advice.
It is in this proclivity of every Indian to build a house, there is a bright future hidden for your sector. New middle class is expanding rapidly in India.
The dreams and aspirations of our country are at an unprecedented height, These dreams start from their own house, the responsibility of which lies with all of you.
You must have read reports from all over the world that people are coming out of poverty very fast in India. And the new middle class has a lot of aspiration. You just need to understand the psyche and situation and introduce your scheme. You might have heard about ‘Nirma’. There were many multinational companies. And ‘Nirma’ sold it’s detergent on bicycle and captured the market of middle class and Lower Middle Class, challenging these multinational companies. It is time that you target your scheme on this new middle class.
And if my business advice turns out to be wrong, whatever is in my bank account is yours… I know that you do not have interest because there is nothing in it.
Understand the aspiration of the new middle class, and link it with your market and business Strategies. I say with confidence that, your company may be two or five years old but you will procure greater profits than the well established companies because a huge market is waiting for you.
There are many of you who are the next generation of developers, so you understand the needs of the generation. You understand the modern culture of India. The responsibility to modernize the real estate sector of the country is on your shoulders.
The central government has been trying for the last four and a half years for a meaningful change in real estate sector. Besides ensuring ease of doing business, numerous efforts have been made to curb false traditions. I understand that for real estate sector in the last few decades, the biggest problem is lack of trust. Four and a half years ago, the situation was such that the middle class family would think a hundred times before investing money in housing. We have seen how millions of people had to go to court for this. Their hard earned money was stagnated because of the dishonesty of some people.
There have been a series of different efforts, to gain this lost trust again. The decision of demonetization brought a great benefit to the real estate. People who wanted to flourish in real estate with their corrupt money, all their doors were shut. Now, only the sincere people can flourish here. I believe that you have experienced five years of my tenure and Gujarat had seen 13 years of my tenure. There has been a consistent feature of it, every decision I make, I had to face a lot of trouble in the beginning. It always happened because; I walked a little ahead of time. Back then, in Gujarat farmers used to ask for electricity. I asked them to decide whether they need electricity or water. They were saying that, all the political parties are giving electricity for free, but I asked them to decide because they were given false promises till now about electricity, but I wanted them to have water to keep their agriculture alive. You will be surprised to know that my own partners sat on hunger strike against me!. My own people used to burn my effigies in every village. There was pressure on me in the election for granting free electricity. I insisted on water and in the beginning, people did not listen to me. Only when they started to experience, they started advocating, ‘per drop more crop’, drip irrigation, ‘Panibachao-panipahuchao’. Agricultural growth in Gujarat continued to be 10 per cent. Now, you need to understand that Gujarat is not an agricultural state, it is a desert land. All this takes time to understand.
I am saying this to the country, for the future generation of India, I believe that ‘Benami property law’ strengthens honesty in our country.
Through the Real-Estate Regulation Act (RERA), trust between customer and you is strengthened. This government had played an important role in this.
And I would like to have all these things in a workshop, and educate you, on how these decisions have increased your strength and status.
Today if you visit any country of the world, or you must have visited already, there was a feeling of distance shown by the rest towards us. But now, they do not want to leave you. The world is eager to meet you. All this happened because of a decision making process, and way of working, which might not effect you directly, but will benefit you though an eco-effect, which makes our countrymen proud of their country. If you remember, during 2013-14 elections, people used to say, “who knows this man in India?, outside Gujarat?”, “he doesn’t know anything about foreign policy!”, they even went on to say,“he doesn’t know how to use cutlery!”. I agree, but my policy is, ‘whatever I do, I will do for the country’. That begot the results you see today. I say that sometimes these decisions should be seen in the perspective of your own business. Your main team should be educated on this. You will start to understand that governments do not make laws or rules just like that. While making laws I interact with people, I understand the need and thus what we sow, we harvest.
I have been told by Jaxay that you are the ones implementing and upholding ‘The Real Estate Regulatory Authority’ i.e. the RERA law. I believe that, it’s everyone’s aspiration to step forward in that direction, and I congratulate you all on that. Some of you might not have been there yet, maybe, but now, in your mind, you aspire to set foot on firm ground and I believe in that. I don’t brood over the past, and I look at tomorrow with faith. I believe that, RERA has been notified in 28 states. In 21 states, tribunal is also working. Today, around 35 thousand real estate projects across the country and 27 thousand real estate agents have been registered. Lakhs of new houses are being built under these projects. Yours is such a field that is associated with an important aspect of the human life. That is their desire to build a house, which is an aspiration that never dies.
You are the sector that employs the most people. And I am not talking just about the masons etc., that are directly involved. Let’s say if your project uses cement, there is employment in that too. If you use steel, then there is employment. Let’s say, if your project forms a good society, it would need a gardener etc., it would need newspaper boys, milkmen. Employment opportunities you see. You serve as catalytic agent in the eco-system of employment. But, you do not get the respect you deserve. Why? Because some of you partner with those kind of people who made you unaccountable; and made you devoid of feedback. It’s them who ruined you.
I believe in your efforts and I have known Jaxay since his childhood. In Gujarat, I used to talk to the people from the diamond industry. At that time, I was not in politics. I asked those people, “you came here at a very young age for cutting and polishing diamonds, and now, you own a company and export diamonds. But why doesn't your image in the society change?”. This was the situation about 20-25 years ago. People used to think twice before giving a house on rent to the people associated with the diamond industry. Today if we see, it’s a different scene, they are much respected and they occupy important seats at any given social function. All this was possible because, I made a very systematic effort to stay connected with them, I believe that in your field, you don’t need to be educated or rich. I am talking to you as a friend. I'm not saying this as PrimeMinister. It should be your priority to increase and uphold your sector’s reputation, and here, your reputation matters a lot. If you make yourself credible, no height is un scalable for you. For such a big sector, social prestige, social acceptance, is of paramount importance. One works so hard in life, for their child’s education and marriage and also to build a house of their own, he trusts you with his dreams, he puts his whole life at your feet and if he is cheated in return, his trust is broken. If one cheats, the consequences has to be endured by a hundred of your ones here. If you understand this challenge and find a solution, you see, a very big change is going to come.
All construction and other permits are now granted faster than before. This has resulted in the country placing itself in the 67th rank in ‘ease of doing business’ ranking in the last four and a half years.
It is surprising for the world that such a big country, a developing nation took such a big jump in ranking. The president of the World Bank called me one day. He calls me and says, “I cannot imagine a developing country, a large country can move so fast with a target set”. It was a surprise for him. He sent a whole team of the World Bank to congratulate me. If you do not take advantage of these things, the country will suffer a lot. And therefore, I want you to take advantage of this opportunity.
GST has also made the real estate business easy for both developers and customers. You know that 15 to 18% tax used to levied on the first construction sector. Stuff like paint,tiles,toilets,shower,cable,wire were charged with a tax of more than 30 percent.
After the implementation of GST, the tax for middle class households is 8 percent and it’s 12 percent for others; Tax has also been reduced on commercial properties. Likewise, GST has been reduced a lot on construction material. Paint, wire, and on accessories like electrical fittings, sanitary ware, plywood, tiles etc.GST has been brought down from 28 percent to 18 percent; GST on bricks was 12 percent which has now has been reduced to 5 percent.
Today we can make good homes for all middle class at the right price. For this income tax has also been exempted. In the year 2016, section 80 IBA was added, using which a 100 percent tax deduction in the profit of affordable housing project is made. Now the time period for completing such projects was also changed from three years to five years. This year time period for approval of affordable housing project which was March 30, 2019, one year has been extended till 31 March 2020. Keeping in mind the problem of unsold inventory, Now, tax will not be imposed for two years on national rental income. Many such provisions were implemented to strengthen middle class homes in the last four and a half years.
Constant efforts are being made so that there is no shortage of funds for the real estate and housing sector. Two years ago, real estate and infrastructure investment trust was given permission to raise funds from debt market, such trusts from 2017 are exempted from dividend distribution tax. ‘Sectoral remittance’ was also removed last year so that housing finance companies can raise funds from abroad.
All these efforts are being made to boost the infrastructure of middle class homes. Employment generation has also got a boost from them. There are crores of people working in this sector. Most of them are part of the unorganized sector. The government has brought an extensive plan for these families related to house construction, in this budget. Now the workers who earn less than 15 thousand, will get 3000 rupees as pension after 60 years. To join this scheme, these workers need to pay an average of 100 rupees every
month.The central government will deposit the same amount in its pension account.
I urge you all to take care of these worker friends who fulfil the dreams of the middle class of the country, by associating them with this pension scheme. If you can also contribute to this by joining these worker friends, I understand that you will also see to that they join Pradhan Mantri Jeevan Jyoti BimaYojana and Suraksha BimaYojana. You must note, that the insurance fixed is of 90 paise. Sometimes while talking with a friend-If you keep the car running, then you burn so much petrol.
If you can just do this much then during any crisis in the friend's life, 2 Lakh rupees each by these two insurance policies, will give a great strength to their family. Thousands of crores of rupees have reached such families in need through this scheme. Crores of families are associated with it. If you know of any poor family, check if they know about it. If they don’t, then please tell them. The government is ready to give. These efforts that you are doing about social responsibilities, we’ll do them more extensively. I have been told that you are contributing towards poor children’s education and skill development and Swachh Bharat Abhiyan, I heartily congratulate you for this.
Next generation leaders like you are the only ones to shape a new India. With faith in your new ideas, and your ability, I can set big and difficult goals. This is due to your strength, I am able to do it. And I believe that your strength makes the country stronger in the coming days. On how to make homes more affordable, there will be serious brainstorming in this program and new ideas will emerge. Especially in the housing sector, discussion about how to use sustainable development and innovative technology more is necessary.
Green and clean energy, energy efficiency, water conservation, construction with reuse of material and promote modern waste management system in apartments should also be your priority. Also, effective and comprehensive use of new technology in construction is also necessary.
Under the Pradhan MantriAwasYojana, new technology is being used in the construction of about 12 lakh houses. By expanding this technology in the housing sector, not only will the construction cost be reduced, but also the construction will be fast. To Identify the world's best in housing technology, ‘Global housing technology challenge’ conference is also being held here next month in Delhi. You all can be a part of this challenge.
Every common man has great hopes from you. You will live up to these hopes, with this belief I was going to tell you a lot today. But I also wanted to add a few more things. I was just asking Jaxay, you have so many young people, is there any competition, etc? So I said, Let me give you an idea-
Should the CREDAI institution think in the direction where, in world of construction, If there are some startups that do innovative stuff, in terms of climate, does something that takes the construction world a step forward, use something that is pro-environment, those who use the technique of making the best out of waste and use such waste in construction or create wealth from waste and so on. CREDAI should organize a competition in these areas, and by creating a jury in these kind of events, one should think of encouraging them with awards or prizes.
Another thing - and I believe you might like it, because you also have a women's organization, but it has women that actually work in this field. Create another organization if possible with women in your family, who are not in business, but work at home. I did an experiment when I was in Gujarat, as the Chief Minister.
We built flats in the place of slums, and there was a huge amount of work. But I
was experiencing something psychological, like you must have seen this in a movie long ago, I saw-I do not remember the name - but you might remember it. Kamal Haasan was the artist in it and He used to live somewhere in a hut, with a railway next to him, he would sleep to the sound of the train. His house is different now, and he could no longer sleep without the train sound. So he records the sound of the train and sleeps while running the tape at night.
It means to say, that he who lives in poverty, when he moves to a new house, he can't adjust himself. But, If he gets guidance at the right time, once he is trained, his life will change; changing walls does not change life. I spoke to an NGO and did this - people who belong to poor families who got pucca houses, I made sure they received training on, how to use the restroom, etc, they did not know. And let me tell you - there are many such things in our country which we will be surprised to hear, because we have not lived that life, we do not know. So they were taught, how to use a toilet, how a tap works, now, if you have a glass window, what will you do? Let's make the curtain from an old saree.
If someone comes to your house, they should use a foot wipe. I started training them on such things through an NGO and spent three weeks. Now their confidence changed so much that they would save money, brought a few plastic chairs, then brought a string to fix the curtain; They started to enjoy life. Then they thought they would bring radio, bring TV etc.
Now along with your housing schemes, if you form an NGO with your own family and train those families, teach them to live - see I tell you, you ‘ll feel more satisfied by changing their lives, than by just building their houses.
You will do certain innovative things and you are young, who receivethings and has immense strength and my mind is very young. So I get connected with you quickly; I don’t feel a gap between us. Neither have I felt the gap of post, nor of age, nor my background. There is only desire in my heart -to see you, talk to you, think about your future, work with you, work together for the country.
With this same sentiment I once again thank you very much and to the artist who has made my drawing so beautifully, many congratulations to him. I have asked Jaxay to give me his address; I must tell that fellow; I will write a letter to him about his wonderful work.
I once again wish you the very best. Things that I have told, regarding our country - take home the good things with you, and if you have felt bad about anything, leave it with me, so that I can mend it. I will come to you again to serve you.