How Real Estate Can Propel Supply Chain Ascendancy

India's real estate sector has adopted a new purpose: to create the physical framework of an emerging global economic power. The industry is actively developing infrastructure, surpassing its traditional capabilities. The reform of the Goods and Services Tax (GST) has facilitated this strategic initiative. It has enabled real estate to transcend conventional development and emerge as a dynamic catalyst for a more accelerated, transparent, and scalable economy. This initiative represents a strategic transformation of the entire sector.

For developers and logistics companies, technology is now the primary tool for going beyond simple compliance. Anuj Kejriwal, CEO and MD of Retail, Warehousing, and Logistics at Anarock Group, notes that enterprise-grade tech is becoming a core competency. "IoT-enabled warehouse management, blockchain-backed title registries, and digital twin platforms make it easier to track inventories, secure financing, and verify asset ownership." These platforms work in concert, with a digital twin of a building, for example, enabling developers to simulate and optimise logistics operations before construction is even complete.

Futureproofing Tax Reforms

Looking ahead, a vision for a fully digital, real-time tax system that eliminates friction and fraud is emerging. Kejriwal outlines three crucial pillars for this future. First, a single, unified digital platform would combine property registrations, construction billing, and e-way bill creation to eliminate manual filings and create an end-to-end digital audit trail. This frictionless flow of data is a prerequisite for a high-speed supply chain.

Second, he envisions a system where AI-powered analytics are deployed to track and identify transactional anomalies in real time. He states that AI must keep an eye on developer transactions at all times to identify unusual activity, such as a sudden spike in material claims that doesn't match the project's physical progress, ensuring instant input-credit validation and more focused audits. By flagging these anomalies automatically, this system can drastically reduce the need for manual intervention.

Finally, a land and title registry built on blockchain would create an immutable and transparent record of ownership. This would not only make title verification instantaneous but also significantly speed up due diligence, reduce the number of conflicts, and make property financing faster and more secure.

An Evolving Tax Landscape

The latest GST changes, which went into effect on September 22, 2025, had a major, albeit varied, impact across different real estate segments. Anuj Puri, Chairman of Anarock Group, predicts a significant upswing in the residential sector. He points out that reduced GST on materials like cement could lower construction costs by "as much as 3-5%", providing a crucial lever for growth for developers, particularly in the affordable housing category.

Puri highlights the urgency of this intervention, noting that the affordable housing segment has seen a dramatic decline, with its share of total sales dropping from 38% in 2019 to just 18% in 2024. He believes that reduced costs, if passed on to homebuyers, can help reverse this trend and make homeownership more accessible to a broader section of the population, including those in tier-II and tier-III cities.

The story is different for commercial real estate, where the reforms have introduced a new set of strategic challenges. Puri highlights that the elimination of Input Tax Credit (ITC) on commercial property leasing may increase operational costs and rental prices. Furthermore, the Reverse Charge Mechanism (RCM) adds a compliance burden for tenants.

For the retail sector, the reforms are generally positive. Puri states that the reduction in construction costs "will result in lower input costs for developers and help speed up the supply of retail real estate projects." This may lead to more competitive rental rates.

Reforms to Push Growth Boundaries

Puri believes that these reforms represent a major positive shift for the entire Indian real estate industry. Beyond improved transparency and ease of compliance, the simplified GST system will "remove most classification confusion and disputes." This will allow developers to pivot from time-consuming administrative tasks to their core business: timely completion of projects and customer satisfaction.

The reforms are also expected to have a cascading effect, attracting more institutional investment into the sector. The benefits are particularly impactful for affordable housing. With India currently facing a shortfall of nearly 1 crore budget homes in urban markets, Puri asserts, "These changes can go a long way towards reversing this trend, making homeownership more accessible to middle-class families." The GST reforms are not just shaping the real estate industry; they are directly contributing to a more equitable and prosperous future for India.