In what comes as a major relief to the construction sector, the revised guidelines, issued by the Ministry of Home Affairs to be followed during lockdown 2.0, has permitted activity to resume in non-COVID-19 hotspots, provided they follow strict social distancing guidelines. While this is expected to kick-start at least some pent-up economic activity, the guidelines make it amply clear that construction workers cannot be brought from outside and only those currently available on the site will be able to resume work.
This decision comes a day after the Prime Minister, Narendra Modi, addressed the nation and said that besides the essential services, a select few additional activities would be allowed which would come into effect from 20 April 2020. This, said the Prime Minister, is to mitigate the hardship to the public at large.
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What this effectively means is that in the next 5-7 days or so some construction activity, which accounts for around 15% of the workforce, will start in a phase-wise manner in few locations with all precautions being taken. The decision to start work in factories and construction in a phase-wise manner subject to conditions, safe distancing, looking after the labour, keeping temperatures regularly and doing all that is necessary in order to contain the problem of COVID-19 has been taken after a series of interaction between the representatives of industry associations, finance minister, commerce minister and officials of the Home Ministry and PMO.
The decision to start at least some of the construction activity on project sites, even with limited workforce, has been welcomed by various stakeholders. Given that migrant labour comprises at least 80% of the workforce in the construction sector, it remains to be seen how many are left at site to resume work. Many migrant labours had left for their villages post lockdown 1.0.
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“It will definitely help real estate to some extent. As far as construction activity in non-hotspots is concerned, developers will need to focus on resuming construction on projects that are already nearing completion and have a completion deadline within 2020,” said Anuj Puri, chairman Anarock Property Consultants. He however, added that the fact that COVID-19 hotspots will not be able to resume activity from April 20 is a dampener for markets such as MMR - a highly-impacted zone which, as per Anarock data, currently has the highest under-construction residential stock of nearly 4.65 lakh units. This accounts for 30% of the overall 15.62 lakh under-construction stock across the top seven cities.
According to Niranjan Hiranandani, president NAREDCO, the essential works like Municipal Corporation, essential work for the monsoon and the railways, all these activities are expected to start; some of them have started last week with the migrant workers who are already on the site. The idea, he said, is to start giving work to the workforce who have not moved out to the villages. “The first phase of activity probably for the next 10 to 15 days will be to stick to those workmen who are already in the cities and in the nearby areas and also near the factories. So that is priority. Second priority would be probably after the lockdown is lifted for the migrant labourers to actually come back,” said Hiranandani.