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GST, RERA Impact

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Tweaked TDR policy gets tepid response

Bengaluru: The government’s ambitious plan to take up widening of arterial roads and other infrastructure

work in thestatehas taken a hit, with its revised Transferable Development Rights (TDR) scheme failing to

garner a good response. The reason — a slowdown in the real-estate market caused by demonetization,

rollout of the Goods and Services Tax (GST) and implementation of the Real Estate (Regulation and

Development) Act.

“Owing to lack of demand and slump in the real-estate market, TDR’s lying unused. We are also going

slow on the concept due to introduction of RERA and GST. The economy

has been hit hard by the two factors after demonetization last year,” a minister told TOI.

The government introduced the new TDR scheme in March to make compensation more attractive for

landowners who lose property to public infrastructure projects.

However, builders believe the new policy is unviable at a time when the market is sluggish. “TDR sales

may not pick up till the real-estate scenario improves. But there is certainly a silver lining,” a senior BDA

official said. The figures are not as bad as being portrayed. “When compared to Delhi and Mumbai, we are

seeing better sales, thanks to early revival of the real-estate market,” the official added.

The other reason for the poor responsetoTDRischange in administration. Since 2006-07, BBMP has issued

TDR worth two million square feet, and only less than half of them have been used. But since the new

policy came into effect, BDA has been generating the certificates. “The slowdown in TDR sales is largely

to do with initial stabilization problems sinceBDA has become theissuing agency in place of BBMP,” said

Mahendra Jain, additional chief secretary, urban development department.

“New agencies have to put systems in place to issue TDR and revalidate the ones issued earlier,” Jain

added.

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