Government today relaxed rules for Foreign Direct Investment, FDI in the construction sector by reducing minimum built-up area as well as capital requirement and easing the exit norms. The revised norms relating to Construction Development Sector, which were earlier approved by the Cabinet, have been notified the Department of Industrial Policy and Promotion. India allows 100 per cent FDI in the sector through automatic route.

Government has reduced the minimum floor area to 20,000 square metres from the earlier 50,000 square metres . It has also brought down the minimum capital requirement to 5 million dollars from 10 million dollars. According to the Consolidated FDI Policy Circular the condition of minimum land of 10 hectares has also been completely removed. The new measure is expected to result in enhanced capital inflows into the construction sector.