Union Finance Minister Arun Jaitley on Wednesday said that the Union Cabinet has approved fresh norms for the construction sector. Jaitley said that the government has been trying over the last year to improve upon the functioning of the sector.
According to the new norms wherever there are disputes pending between public bodies and construction sector a procedure for a cheaper and quicker arbitral process would be available. Jaitley said that in all new contracts relating to construction, there will be a conciliation board provision and this broad will comprise of independent subject experts.
The construction sector which contributes 8% to the country’s gross domestic product (GDP) will now see quicker resolution of disputes, kick-start to stalled projects and access to financing easier.
The Department of Financial Services and the Reserve Bank of India will try to prepare a policy on how to deal with those companies which have got a lot of stressed assets in the real estate sector. The minister hopes that series of new reforms will pump in a lot of liquidity into the sector, activate real estate projects and infrastructure projects which have been stranded for some time.
As the construction sector has a huge employment potential and there is a need for more housing, more urbanisation and more commercial spaces, Jaitley hopes that new norms will take care of it.
According to the cabinet note, besides its major contribution to the national income, the sector is the largest creator of direct and indirect jobs, employing about 40 million people.