BHUBANESWAR: Odisha’s Rs 5,000 crore real estate sector is staring at colossal losses, thanks to the lockdown. Industry specialists say it might take months to recover now. Labour shortage and disruption in supply of raw materials have brought construction works to a grinding halt. Close to a million workers of different categories are engaged in Odisha’s real estate sector that builds around 10,000 dwelling and commercial units. With most workers unavailable at work-site after lockdown and many unable to return due to restrictions on movement, hundreds of projects in Bhubaneswar and other parts of the State have not seen any progress in the last one-and-half month, said DS Tripathy, Chairman of Confederation of Real Estate Developers’ Association of India (CREDAI), Odisha. .
A sizeable number of migrant labourers and workers from Jharkhand, West Bengal, Bihar and other states, who comprise more than 50 per cent of the workforce in Odisha had left the project sites soon after lockdown was announced. Though State Government has allowed in-situ construction work, it could not be resumed full-fledgedly due to shortage of supporting workforce, Tripathy added.
More than 150 projects at different stages of construction are likely to get delayed by months for want of workforce. “Not even 2 per cent of the projects has the required number of manpower at the sites to carry out construction work. Besides, monsoon is also nearing which will further delay the work. In such a scenario, the validity of building approval which is usually three years will pose a big problem,” said Nitish Nanda, general secretary of Association for Odisha Real-estate Developers. Project developers and builders say a steep hike in prices of cement and other raw materials and disruption in their supply are other issues affecting the industry badly at present and no one knows when things will return to normal.
While rise in price of raw materials is affecting overall project cost, developers also feel that job loss in other sectors may prompt a change in buyers’ mind and indirectly reflect their buying decisions. “After lockdown ends, buyers may give less priority to purchase new house or may look for affordable housing as per their budget,” Nanda said.
The realtors said if the State Government and Centre take measures to bring down registration cost, GST, interest rates of project financing by banks and announce a moratorium period for repayment of loan, it will help revival of the sector and they will also be able to pass on the benefits to the buyers.“As all are inter-dependent, we expect the State and Centre to come forward with these measures for revival of the industry,” Tripathy said.
manpower shortage
● Workers from Jharkhand, West Bengal, Bihar and other states comprise more than 50 pc of workforce in Odisha
● More than 150 projects likely to get delayed by months in absence of workforce
● Only about 2 pc projects have required number of manpower at the sites
● Steep hike in prices of cement, other raw materials and disruption in supply impacting the industry