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In a recent updation of policies, India has decided to allow the contribution and participation of foreigners into our country's real estate market as well as stock market. There has been much uproar in domestic as well as internal market after India allowed the direct inclusion of Qualified Foreign Investors known as QFIs, into the Indian real estate. It has resulted in large scale interest of investors worldwide. There have been so many enquiries which have cropped up from all sectors of the world regarding the regulation.

The step to allow direct entry of foreign investors has been done to expand the market for investors as well as lure foreign funding in the country. It has been seen as a procedure which would minimize the market volatility. Till now, apart from NRIs, investors with foreign institution and sub-accounts were allowed to invest directly in the Indian stock and equity market.

The country’s decision has been taken seriously worldwide and one amongst so many interested investment countries is the Arab world. Some big real estate agents and influential companies have showed their interest in putting up their investments in India.

There have been several responses and queries regarding India’s decision. An Arabian real estate dealer has written his query to Pranab Mukherjee, our finance minister. In his query, he has expressed his view that there are lots many UAEfamilies who have been doing business with Indian companies. With India’s decision, they have welcomed the initiative and have expressed that such UAE families would be first to move to India for investment opportunities.

Another clarification needed from Indian government was if individuals, or associations related to the Gulf Cooperation Council be allowed to involve in the stock market. This question was raised because of the two conditions that were set by our country’s finance ministry related to allowing overseas investment.

The experts feel that only those countries can invest which adhere to Financial Action Task Force (FATF) and the International Organisations of Securities Commissions (IOSCO) policies. Such countries are 80 in number. These organisations are strictly promoting international policies to fight against money laundering as well as terrorist financing projects. There are few individual countries like Bahrain, Oman, and UAE which are not members of FATF. Besides this, countries like Bahrain and Dubai Financial Services Authority are only few members of organisations like IOSCO.

The Arab investors are of the opinion that the two terms put by the Indian government should not come as a hurdle in their route to invest their money in real estate market of India. There has been more interest in Indian market in recent times because of the recent European crisis.

Even though there has been an exciting response from gulf countries, the government has to still think on the queries stated by the Arab world as there is a big question mark related to gulf investments on real estate. Let’s see what is in store for investors from India in this new year!

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