What must change for India Reit success

Author: Ashley Lee | Published: 13 Nov 2013
  • India’s securities regulator, the Securities and Exchange Board of India, announced draft rules for real estate investment trusts (Reits) on October 25;
  • This is a positive development for the Indian capital markets, as it introduces more sophisticated fixed-income products;
  • But tax issues and foreign investment restrictions must be clarified before Reits can become popular.

The Securities and Exchange Board of India (Sebi) last month announced draft rules for real estate investment trusts (Reit). But changes are needed if Reits are to succeed in the country.

Sebi issued a consultation paper on draft guidelines for Reits on October 25 in response to the product’s growing popularity. Similar initiatives have been contemplated for over a decade, but practitioners remain optimistic about this new development.

With Reits unavailable in India,...