News release

JLL India reacts to the Union Budget 2023

A balanced one for the economy but a misses out key demands of the real estate sector.

February 01, 2023

The 2023 Union Budget, in a pre-election year, sought to build on the roadmap laid down by previous budgets, focusing on inclusive development, fostering growth and job creation while keeping the macro-economy in a stable yet growth-oriented mode.

Some key announcements and their potential impacts are summarized below:

Building on India’s pharma capabilities

Pharma R&D was prioritized, which is likely to give a big boost to R&D activity in the pharma value chain and create the need for such facilities in specialized zones across the country. This will spur the development of lab spaces for such pharma firms, pushing more investment in the country and increasing the need for specialized real estate.

Infrastructure: The key focus area

The continued focus on infrastructure development saw capital expenditure enhanced to an effective amount of INR 13.7 lakh crore which is 4.5% of the GDP. Increased allocation to railways and a significant focus on seamless connectivity through road, rail, port, and airports will support multi-modal connectivity, while reducing the overall transportation and logistics costs. This will also boost supply chain efficiencies on an overall basis. With additional focus on coastal shipping improvement, aiding both people and freight movement through Viability Gap Funding, and the development of 50 new airports, infrastructure will remain a key sector for focused growth.

The continuation of interest-free 50-year loans to state governments for an additional year, with an outlay of INR 1.3 lakh crore to support infrastructure development, will be a big boost to improving overall connectivity across the country. The announcement on tourism and related infrastructure focusing on its promotion through the PPP mode will support the overall economy and spur the demand for hotels and other related infrastructure creation.

Sustainability agenda: India’s journey to net zero

The aim towards net zero carbon by 2070 has been galvanized with a grassroot-level focus in the current Budget. The enhanced production target of 5 MMT by 2030 for green hydrogen under the National Green Hydrogen Mission, the INR 35,000 crore outlay for priority capital investment in green power, green credit programme, PM PRANAAM scheme for pushing alternative fertilizer usage, battery storage promotion through VGF as well as the vehicle scrapping policy will all support in the creation of a circular economy and put the country firmly on the path towards its sustainability targets.

The emphasis on green mobility and increasing ownership of EVs was supported by custom duty reduction on lithium-ion batteries and an extension of subsidy on EV batteries. Additionally, the Budget allocation for FY 2024 under the FAME scheme has been enhanced from INR 2,908 cr to INR 5,172 cr. This will continue to provide a boost to EV production in the country.

Creating sustainable cities of tomorrow

Addressing the need for creating sustainable cities of tomorrow, the focus on urban planning, easing land availability, promoting TOD schemes and supporting urban local bodies in enhancing property tax collections will be key. The setting up of the Urban Infra Development Fund to be managed by the National Housing Bank, for urban infra improvement in tier 2 and 3 cities, is a welcome step towards creating more infra-led economic centres in the country.

Further push to start-ups

The Budget offered more support to the startup ecosystem by extending the date of incorporation for income tax benefits, for eligible start-ups, by one year till March 2024. Further, the benefit of carrying forward losses on change of shareholding has been increased from 7 years of incorporation to 10 years. This will provide policy support to help in sustaining the sector, boost investments while creating incentives for more startup founders. With the entrepreneurship environment moving towards a more positive light, job creation will also see elevation. 

Real estate: Affordable housing in focus

From a real estate perspective, the Budget was not an interesting one, barring the enhancing of the PMAY outlay by 66% to INR 79,000 crores. This will support the completion of the ‘Housing for All by 2025’ agenda and continue capital allocation for CLSS and other related schemes under PMAY. 

Income tax announcements: More money in the hands of individuals

The direct income tax benefits will bring more money into the hands of the middle- and higher-income class. This will support homebuying activity as it will ease the pressure of increased EMIs and higher home prices for prospective homebuyers.

The revision in Section 54 and 54F has now capped the deduction of capital gains from house property to INR 10 crore. This will create a higher tax incidence for high-value transactions.

Boosting digital transformation: 5G and digital embassies

The initiative of 100 labs for 5G applications will help develop usage for telecom networks beyond mobile phones. The rollout of 5G across the country and new applications developed by the Indian startup ecosystem is expected to spur exponential growth of data consumption and will translate to increased demand for data centres.

The setting up of Data Embassies in GIFT IFSC for countries seeking digital continuity solutions will facilitate the growth of data centres.

Concluding remarks

On an overall basis, the focus on start-ups, MSMEs and manufacturing capacity building in the country are all positive from a job creation perspective, increased investment in the economy and the need for more real estate – both for offices and greenfield manufacturing facilities. However, these benefits will accrue over a sustained period.

In conclusion, the Budget is a balanced one for the economy but misses out on key real estate sector demands and specifics about operationalization of various announcements. Tangible action points over the course of the next financial year would be awaited to see real on-ground activity on key points highlighted on sustainable cities and net-zero targets.

About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $19.4 billion, operations in over 80 countries and a global workforce of more than 102,000 as of September 30, 2022. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit

JLL is India’s premier and largest professional services firm specialising in real estate. The Firm has grown from strength to strength in India for the past two decades. JLL India has an extensive presence across 10 major cities (Mumbai, Delhi NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad, Kochi, and Coimbatore) and over 130 tier-II and III markets with a cumulative strength of close to 12,000 professionals. The Firm provides investors, developers, local corporates, and multinational companies with a comprehensive range of services. These include leasing, capital markets, research & advisory, transaction management, project development, facility management and property & asset management. These services cover various asset classes such as commercial, industrial, warehouse and logistics, data centres, residential, retail, hospitality, healthcare, senior living, and education. For further information, please visit