The real estate companies participating in CREDAI's yearly NATCON event in Singapore hailed the central government's GST 2.0 reforms, calling it a "step in the right direction" that will lift housing demand in India, but sought changes in the definition of affordable housing.

CREDAI, the apex real estate body representing 13,000 developers in India, believes that real estate companies are ready to pass on the GST benefits to consumers, which will be revealed after September 22, the date when GST 2.0 comes into effect.

Boman Rustom Irani, chairman and MD, Rustomjee Group; and chairman, CREDAI National, said that GST 2.0 is a step in the right direction, as the government has taken initiatives to make affordability more understandable and accessible to the masses.

"They have uniformly brought down the GST slabs, removed things like cess and gone ahead and made simplification of the GST rules itself. I can tell you on the ground, and that’s what the consumer businesses are telling me, that there’s definitely a feel-good factor—that people believe that the government is interested in bringing the cost down and everybody is very excited about it," Irani told Fortune India.

Irani, who has been an investor in Jawa, Yezdi & BSA Motorcycles, said CREDAI developers will pass on GST 2.0 benefits to the buyers. "GST cut on the materials means that if the end price is less, even the GST on that will be less, and the stamp duty will be less. So, there will also be a multiplier effect. All of that will be passed on to the consumer."

He, however, said the exact impact of it on real estate is dependent on the 250-odd industries that real estate companies rely on, namely cement, steel, which are the largest components. "If the reduction in taxes is passed on to the developer, we will definitely move towards that. On how much is possible, we are still working and we will know in the short term.”

India’s real estate is poised to reach $5-10 trillion by 2047, fuelling close to one-fifth of India’s GDP, while office and industrial and warehousing stock is expected to cross 2 billion sq ft, according to a new report, “Indian real estate: Fostering equity and fueling economic growth” by Colliers and CREDAI.

Shekhar Patel, President, CREDAI, said as India looks ahead to 2047, the sector has the potential to contribute significantly to the nation’s economic transformation. He said GST 2.0 is set to boost demand, especially in the wake of upcoming festivals. "The impact (of GST 2.0) has started to be seen. We are feeling on the ground that the inquiry level has increased. The conversion level will increase either after Diwali or during Diwali. But the inquiry level has increased a lot," Patel responded to a Fortune India query.

High Commissioner of India to Singapore, Shilpak Ambule, also spoke on Day 1 of the CREDAI NATCON event, talking about strengthening bilateral ties, tech and skill collaboration and opportunities in real estate-linked sectors. “The past year has been very busy. Prime Minister Modi visited here in September last year, and we decided to elevate the relationship to a comprehensive strategic partnership…They identified six new areas of collaboration between India and Singapore.”

India and Singapore last week unveiled a roadmap to boost trade under the Comprehensive Strategic Partnership, which aims to deepen trade relations between the two countries, tie up in the semiconductor space, sustainable industrial parks, and explore digital finance.

Ambule said India and Singapore's strategic partnership has started with UPI and PayNow linkage, and the skilling space. "Singapore has mastered the art of skilling…So what we are doing is we are trying to take the help of Singapore and build similar skilling institutions back in India. Few states have done well, like we have a World Skilling Centre in Bhubaneswar, Odisha, which has been built by the Singaporeans and they are operating it right now."

Shilpak Ambule, on investment opportunities in Indian real estate-linked sectors, said that in the last year, the collaboration with different states of India has increased. "We have had six state delegations coming in; five chief ministers have come in to pitch their state as an investment destination. Singaporean companies and Singaporean investment funds like Temasek, GIC and others are actively looking to expand their investments, their exposure and their portfolio in India.… areas which are vast, directly related to housing but indirectly related to developers like logistics, warehousing, industrial parks, commercial real estate, business and IT parks."

CREDAI, via its latest report, has outlined real estate’s role in driving India’s $30 trillion economy by 2047, saying the industry is poised to reach $5-10 trillion, fuelling close to one-fifth of India’s GDP, while office and industrial and warehousing stock is expected to cross 2 billion sq ft. As India reforms take shape and real estate companies expand beyond top hubs, annual housing sales could potentially double to 1 million units by 2047, it stated, adding share of REITs in real estate market capitalisation is likely to be at 40-50% by 2047, up from current levels of 10%.