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Real estate developers in West Bengal have largely welcomed the Union Budget 2026-27 for its strong emphasis on infrastructure-led growth, saying higher capital expenditure on highways, Metro rail, logistics corridors and urban infrastructure will improve connectivity and unlock new growth corridors across eastern India. Industry bodies believe the focus on Tier-II and Tier-III cities, City Economic Regions (CERs), REITs, InVITs and risk-mitigation mechanisms will support long-term urban development and attract institutional capital. However, developers have expressed disappointment over the absence of targeted measures for affordable housing, warning that unchanged price and area caps, rising land costs and higher construction expenses could further shrink supply. They cautioned that continued neglect of this segment could push up rentals, increase commuting distances and worsen informal housing in urban areas, even as infrastructure investment creates broader economic momentum.
Real estate developers in West Bengal have offered a mixed response to the Union Budget 2026-27, welcoming its strong infrastructure focus while raising concerns over the continued lack of targeted support for affordable housing. Advertisement
Industry representatives said the government's higher public capital expenditure of INR 12.2 lakh crore on highways, Metro rail, logistics corridors and urban infrastructure would significantly improve regional connectivity and create fresh development opportunities in eastern India. The emphasis on infrastructure-led growth is expected to unlock new growth corridors, particularly in Tier-II and Tier-III cities, which have traditionally lagged larger metropolitan markets in terms of investment and absorption.
CREDAI West Bengal president Sushil Mohta said sustained investments in highways, Metros, railways and urban infrastructure would support long-term urban development and help decentralise growth beyond major cities. He added that faster approvals, simplified processes and greater digitisation could play a key role in reducing project timelines and holding costs for developers. However, he described the absence of meaningful interventions for affordable housing as a serious concern for the sector.
Mohta noted that the long-pending demand to revise outdated price and area caps for affordable housing had once again been overlooked. With land prices and construction costs continuing to rise, he warned that the share of affordable housing could decline sharply, from nearly 18 per cent of total supply to around 12 per cent. He said affordable housing should be treated as economic infrastructure, cautioning that a sustained contraction in supply could lead to higher rentals, longer commuting distances for workers and the growth of informal housing in urban areas. He also pointed out that there was no relief on GST rationalisation, input tax credit or income tax benefits on home loans, while the long-standing demand for industry status for real estate remained unaddressed.
Ambuja Neotia Group chairman Harshavardhan Neotia said the Budget reinforced the government's commitment to urban transformation. He highlighted that the 8.9 per cent increase in capital expenditure to INR 12.2 lakh crore would help sustain momentum in large-scale development and generate opportunities across the construction and real estate value chain. He added that measures such as dedicated REITs for CPSE asset monetisation and the proposed Infrastructure Risk Guarantee Fund would help de-risk capital deployment and attract long-term institutional investors. The allocation of INR 5,000 crore per City Economic Region and the continued focus on Tier-II and Tier-III cities were seen as particularly relevant for eastern India.
Merlin Group managing director Saket Mohta said that while the Budget lacked direct sector-specific incentives, it was encouraging from a macroeconomic perspective. He noted that the sustained push towards infrastructure creation and balanced regional growth was likely to support real estate demand in an indirect but meaningful manner over the medium to long term.
Jain Group managing director Rishi Jain said the focus on infrastructure, REITs and InVITs would help unlock capital and support long-term housing growth, improving confidence among both developers and homebuyers. Bengal Shristi Infrastructure Development Ltd chief executive Sahil Saharia said the Budget offered limited short-term relief, adding that although the capex push and City Economic Regions reflected long-term planning, key demands such as infrastructure status for real estate and higher Section 24(b) deductions remained unmet. Purti Realty managing director Mahesh Agarwal said support from REITs, InVITs and institutions such as NIIF and NaBFID would ease funding for large housing and infrastructure projects, even as concerns over affordable housing persisted.
Source - PTI
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