June 5 (Bloomberg) -- Indian Prime Minister Manmohan Singh’s cabinet approved a bill seeking to regulate the residential housing industry to protect home buyers.
The cabinet endorsed the Real Estate (Regulation and Development) Bill yesterday, Housing Minister Ajay Maken said in a briefing in New Delhi today. The plan needs the approval of lawmakers and will be presented at the next session of parliament, he said.
India’s housing sector is largely unregulated and opaque and consumers are often unable to access sufficient information or hold builders accountable, according to the government. Regulations will enable the industry to access capital markets for growth, the administration said.
“In the near term, the bill, once enacted, could lead to some delay in new launches,” said Harvesp Mehta, director at Motilal Oswal Private Equity Advisors Pvt. Ltd., which manages a property fund. “It proposes several stringent norms against developers in case of non-compliance.”
At the same time, the planned legislation is a step in the right direction, he said.
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