ISSN (Online) - 2349-8846

Madalasa VenkataramanSubscribe to RSS - Madalasa Venkataraman

Distortions in Land Markets and Their Implications for Credit Generation in India

Data shows that land is collateral in a large proportion of loans in India. Yet, the several structural, regulatory, and information-driven distortions that afflict Indian land markets force lenders to adopt conservative policies ex ante, affecting both the availability of credit and the collateralisation of land. The paper examines some of these distortions and highlights their significance to the current debate on reforming bankruptcy framework in India. The first part of the paper discusses structural, regulatory, and informational gaps that limit lenders’ ability to lend against land as well as recovery after default. In the second part, some opportunistic and structural reforms in the land markets that could effectively monetise land in credit markets have been proposed.

Setting Circle Rates for Urban Property Transactions

Circle rates are becoming the norm in most states so as to curb under-reporting of prices and also reduce the extent of unrecorded transactions in realty markets. However, to ensure that circle rates are updated and maintained in a fair manner government authorities must follow a scientific method to determine rates without causing arbitrary changes in the market.

Analysing Urban Growth Boundary Effects on the City of Bengaluru

Bengaluru is encircled by a green belt, instituted as an urban growth boundary to contain sprawl, ensure equitable growth, and preserve lung spaces. Urban growth boundaries the world over are typically known to drive land prices higher in the inner city area by artificially limiting the supply of land. Bengaluru has witnessed significant increases in land prices over the last decade. This paper examines whether the green belt in Bengaluru has had a significant effect on land prices through an analysis of price differentials inside and outside the growth boundaries. It also debates the relevance of a green belt as an urban containment tool in regimes characterised by ineffective provision of infrastructure and lax implementation of zoning regulations.
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