Latest statistics show a rapid growth in the number of cases tested positive for the novel Corona
Virus in India in the past 1 week itself. Just when the citizens thought that our country had it under
control as compared to those who have taken a massive hit of the virus, our numbers have
skyrocketed and caused a frenzy of panic. With more than 5000 cases and 150 casualties
throughout the nation, COVID-19 has also targeted local as well as large-scale businesses in all
states.
Reference – A picture taken with a drone from Ganga Ishanya, shows an empty street due to the
lockdown.
The nationwide lockdown since March 24th, in order to contain the repercussions of the novel
COVID-19 pandemic has resulted in businesses and profits taking a back-seat to the development
and sustainability of the country. This lockdown has affected the Indian real estate sector majorly as
it heavily depends upon its construction workers and on-ground staff. With a lot of disruption and
backlog due to corona virus, all industries, along with the real estate sector, have taken a massive
hit.
On April 2nd, the MahaRERA has extended completion dates of real estate projects across the
country, whose original completion date was to expire on or after March 15th, 2020. This
announcement sets completion of projects back by 3 months due to work-force and monetary
resources being affected, as is the case for most sectors across the globe. However, while there is
now a delay in the finalisation of projects, there won’t be a significant delay or drag once the
economy and work get back on track.
Currently, one of the challenges being faced by Indian real estate is the impact on contracts and
agreements due to COVID-19, which are currently in progress. Investments that are done via REITs
will take a back seat now and will give investors and developers time to rethink about future
strategies. One of the laws that is being contemplated in this current scenario is Section 56 of the
Indian Contract Act, 1872, which talks about ‘impossibility of performance of contract owing to
certain unavoidable events’.
The MahaRERA has also stated that due to the lockdown, the supply chain for obtaining
construction material has been disrupted and the workforce has returned back to their home states
to be with their families and provide for them. Due to these circumstances, real estate projects
across the country will take a while to begin work again. Developers and industry experts, who
have been demanding this very step in the wake of the pandemic, are appreciating this move. As
life and work come to a halt and uncertainty looms in the air in view of this pandemic, this decision
comes as a major relief for developers across the nation.
