Mumbai, 27th March 2025: The real estate sector is a cornerstone of India’s economic framework, contributing substantially to GDP, employment generation, and infrastructure development. As global economic uncertainties persist, it becomes more important than ever to strengthen and sustain the growth of the Indian real estate industry. However, certain regulatory bottlenecks and policy ambiguities are currently hindering the sector’s progress. Swift and constructive intervention is essential to ensure continued momentum.
Key Challenges Facing the Real Estate Sector
1. Environmental Clearance (EC) Roadblocks:
The procedure to obtain Environmental Clearance under the EIA Notification, 2006 has grown more complex, particularly for projects located near eco-sensitive zones.
The 2014 notification by the Ministry of Environment, Forest and Climate Change (MoEFCC) exempted certain real estate projects listed under Item 8(a) and 8(b) from General Conditions, allowing for State-level appraisal. Recent regulatory changes, however, have led to uncertainty on whether these projects now require Central-level approvals.
Nearly 50% of projects in Mumbai are at risk of prolonged delays due to this ambiguity, affecting both housing supply and sectoral growth.
A simplified and transparent clearance mechanism is essential to support timely project delivery without compromising environmental norms.
2. RG Podium Regulation Confusion:
Real estate developers are facing a lack of policy clarity regarding recreational spaces in projects.
While the DCR 1991 mandated open spaces at the ground level, the DCPR 2034 allows partial allocation of such spaces on podium levels.
This inconsistency is leading to delays in project approvals and cost escalations.
A uniform and well-defined regulation is necessary to avoid misinterpretation and ensure seamless planning and implementation.
3. Aviation Height Restrictions Hindering Growth:
Civil aviation rules governed by the Aircraft Act, 1934 and Civil Aviation Requirements (CAR) guidelines are placing stringent height limits on projects in Mumbai, hampering vertical development in a city where horizontal expansion is severely constrained.
Updates in regulations from GSR 751(E) to GSR 770 (E) have introduced stricter height limitations, particularly the five nautical mile (5NM) protection zone, which is being applied beyond its intended scope.
Inconsistent application of shielding benefits and arbitrary height restrictions are creating unpredictability in approvals and deterring investment.
A balanced policy framework is needed that safeguards aviation norms while supporting planned urban expansion.
Commenting on the current scenario, Prashant Sharma, President, NAREDCO Maharashtra, said: “The real estate sector has the potential to be the backbone of India’s economic resurgence, but regulatory ambiguity is slowing down its stride. It is imperative that government bodies and regulatory agencies work together with industry stakeholders to streamline the approval processes, bring consistency in policy implementation, and ensure that urban development can progress sustainably. Timely interventions in resolving the environmental clearance issues, RG podium interpretations, and aviation height restrictions will unlock the true potential of real estate in Maharashtra and support our collective vision of Housing for All.”
Addressing these pressing challenges is vital to sustaining growth, enhancing investor confidence, and ensuring housing supply in urban centers like Mumbai. NAREDCO Maharashtra stands committed to collaborating with authorities and stakeholders to promote a balanced and forward-looking real estate ecosystem.
