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Tuesday, April 1, 2014

Real estate, construction sectors hit, as companies divert funds to poll contribution

As India's mammoth general election approaches, jackhammer drills are quietening down at construction sites and earthmovers and cranes remain parked.
Many of the country's real estate and construction companies - their finances already squeezed by a sharp economic slowdown - are diverting funds from housing and other projects to election campaign contributions. Many projects are stalled, at least temporarily.
More than other businesses, developers and contractors in the country are particularly reliant on ties with the government to acquire land or win contracts. If they fund a winner's campaign, the payoffs can be huge.
Based on past elections, such companies could end up funding a disproportionate amount of the $5 billion that political parties are likely to spend this time to woo the country's 815 million voters.

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