Editorial: Is Indian Real Estate Following the Trend of China Real Estate’s Downfall?

By Dr. Sanjay Chaturvedi, Editor

Housing Finance borrowers have started refusing to pay EMI on home loan taken in China. Reason is a major default by the builders and developers to complete the projects and completion nowhere. Besides this, a huge recessionary trend in the national economy is seen after COVID period which is still running.

In China, real estate prices will see a nose dive in August 2022.  Month-on-month price falls spread to more cities in August 2022, with unfinished projects across China increasingly a longer-term drag on sentiment. Out of the 70 cities surveyed, 50 reported price falls in August, up from 40 cities in July 2022. Home prices dropped 0.2% and 0.4% in tier-two and tier-three cities respectively, official data showed.

Empty unsold buildings were made to be demolished as builders could not sell and property tax was mounting. Videos of demolishing big towers in China were circulated in social media and in authorised media of China.

What was the problem? It was nothing less than the Sub Prime crisis in the USA, where the investors of Mortgaged Backed Securities started liquidating the investment on the pretext of bad loans. The victim was Lehman Brothers and many non banking financial institutions including some famous REITs. Similarly in China too, the loans were refused to be served by the home loan borrowers as the builders could not complete the projects in time and had manipulated the funds from the operations and sales.

“Short term borrowings and long term investments” is the perpetual bad habit of the real estate players. A new trend has emerged as “the profits are withdrawn first” at the starting point of the project.

Will RERA in India help? To the extent yes. Because of two reasons. First: no project can be sold without first registration with RERA, this will take away the joy of selling the projects before launch, “pre launch”. It discourages the investors to reduce speculations. Secondly: A prescribed rule in the RER Act 2016 is for 70% of the receivable must be deployed in the construction of the said project.

The customer behavior in India is extremely different then of China or European countries. Here, “Home” is just not an asset but it has sentimental values. The home borrower, unless in distress, will keep the payment of EMI on its highest priority. The default rates and industry standard NPA has been below 2% since 2003. It may vary lender to lender as per their credit policies and exposure to risk while distributing loans.

China’s home loan market is different from that of India. The state owned agencies decide the credit policies and MCLR. Whereas the open economy of India has deregulated the MCLR long back. RBI puts a suggestive lending and REPO rate. Every bank and financial institution has its own minimum lending rate structure and add-on as per the risk and credit score of the borrower.

But a big lesson must be learnt from China is when things go into litigation, the borrower wants to stop the EMI, which he does instantly and make the bank a party specifically when there is a subvention scheme.

It will be a difficult proposition for the banker to recover the major part of the loan from builder and borrower when builder defaults and does not pay pre EMI as promised in tripartite agreement, and borrower limits himself to the amount paid in subvention scheme.

The Subsidy scheme is nothing but the borrower gives guarantee to construction loan taken by the builder. In this, when the builder fails, the borrower is solely responsible even though the builder has taken the entire money as construction loan.



Lecture: Introduction to Research Methodology

Research: Impact of mill land on Mumbai’s skyline

By Dr. Sanjay Chaturvedi, LLB, PhD.

Mill land has suddenly become most important subject for real estate development in Mumbai. The magnitude of the land is very vast. Mumbai, commercial capital of India, is having scare land and vast potentiality to develop it. Private participation in developing Mumbai cannot be compared.

There are 58 cotton mills in Mumbai, of these 26 were deemed sick and were taken over by the government of India. Out of these, 25 are managed by National Textile Corporation (NTC) and by Maharashtra State Textile Corporation (MSTC). Remaining 32 mills continue to be in the private sector. Even after taken over, these mills continue to be sick.

Textile mills hold 400 to 500 acres of land just in the heart of Greater Mumbai. NTC alone having 275 acres in its possession.

To understand its impact on the regional economy and geographical importance, let us first look into the history of these mills. In 1700 century, cotton trade with China from Bombay had begun. Economically the traders of Bombay began into cotton with the proceeds from illegal trade with Malwa district in the north. In 1853, the first rail link was established to Thane and in 1863 the railway link was extended through the Bhor ghats to the Deccan. It was then possible to channelise raw cotton from its major growing areas (Nagpur) to the foreign markets through Mumbai.

Hence sprung up a large number of godown and warehouse between the railway line and the docks at the Cotton Green dockyard, Sewri. The Mumbai port was having most advantageous location and was in competition with world including American cotton trade. In 1854 when first smoke from the cotton textile mill went up in the air, a new era began for the textile history in the country.

The first mill that appeared on the Mumbai’s land was Bombay Spinning And Weaving company’s cotton mill at Tardeo in central Bombay. The success of first mill had encouraged Bombay’s businessman to shift their operations from trading into manufacturing. The Oriental Spinning & Weaving Company started its mill in 1858 and the Bombay United Spinning & Weaving Company followed in 1860. The cotton boom of 1860’s invited further enterprise in the industry and by 1865, ten mills employed over 6500 workers.

The Municipality undertook the task of filling in with town sweepings the lands between Mahalaxmi & Clerk Road that had originally been covered by swampy flats. A new thoroughfare was laid across the area where drainage seemed difficult; the land was raised to a height of the new roads. The project made possible the construction of more mills and worker chawls on land lying between Tardeo and Lower Parel. This lead to a steep rise in land prices within the area.

The Mills employed hundreds of thousands by 1900. The number of mills increased from 42 in 1880 to 138 in 1900. The most evident change in the composition of the population was a wave of poverty stricken Maharashtrian peasants from the drought ridden districts of Satara, Kolaba and Ratnagiri, who came to Bombay for jobs in the textile mils and docks. They settled in what came to be termed Girangaon, the village of the mills, which included the areas of Tardeo, Byculla, Mazgaon, Reay road, Lalbaug, Parel, Naigaum, Sewri, Worli and Prabhadevi, leading to a spurt in the population from 0.64 million in 1872 to 0.82 million in 1891.

The Mills were located on the outskirt of the Fort area. In the stretch of Parel and Byculla land was then available in plenty and the 55-60 odd mills spread over 12-20 acres each in culmination amounting to nearly 400-500 acres of land.

Initially, labour was cheap and mill owner never gave them any other benefits. After Trade Unions were formed, the mill owners were forced to give them a number of benefits in addition to high wages. Their shares in profits became less. They were also forced to pay higher property taxes. The mills were not then a profitable venture for them and they started declaring it sick.

Regulation 58 of the new DCR which came into force in March 1991, provides for development of sick and/ or closed cotton textile mills on condition that one third of the land is given to the BMC for public amenities AND 27-37 % (depending on the area of the mill) is given to the MHADA and PSU’s for housing. The remaining lands could be developed by the owner for residential and commercial uses as may be permissible under the DC regulation in force.

The DC regulation of March 1991 intended to regulate the development of cotton textile mills so as to generate open spaces and public houses for the city, in a manner, which would create coherent urban form. Such redevelopment that has occurred has been in a piece meal and haphazard manner on a totally commercial basis, without any portion of the land becoming available either for low income housing or for public amenities. On 29th February 1996, Maharashtra government had instituted a study group under the chairmanship of Architect Charles Correa to have an integrated development plan for the development of textile mills. In June 2000 state government cleared the proposals to sale of surplus mill land of NTC as per DCR.

Mill Name Buyer Price (In crore Rupees) Venture
Mumbai Textiles DLF- Akruti 702 Entertainment Complex
Apollo Lodha Group 180 Either entirely residential or
entirely commercial
Matulya Ashford Unknown Residential
Elphinstone Indiabulls 441 Commercial
Simplex Godrej Jt Vt Unknown Residential
Khatau Marathon 145 Unknown
China Dosti Group 53130 Residential
Standard Sheth Builders 130 Residential (would also
have retail space)
Jupiter Indiabulls 276 IT Park
Kohinoor Kohinoor 421 Shopping Complex

Now the land is absolutely in the real estate market. The centralized site of these mills will impact major sale of western suburbs. Proximity to South Mumbai and well connected to both the suburban lines, these mills land have approximately 200 acres to be constructed and sold. Huge land will be now available for private developers for big housing complexes. Many of such projects already started or on the verge of it.

Research: Gurgaon beats all markets in North India

By Dr. Sanjay Chaturvedi, LLB, PhD.
Gurgaon is one of the fastest developing cities in northern India and its proximity to New Delhi helps. Gurgaon is a massive economic engine for Haryana and over 50 per cent of the state’s income tax revenue comes from Gurgaon and Faridabad. The city is also a great example of world-class infrastructure, work and living environments which makes it a magnet for global investors and business communities.
Though, Gurgaon is best known for India’s most prominent IT hubs, some of the real estate players like DLF, Unitech and Omaxe have played major role in putting Gurgaon on global landscape.
The role of the private sectors is very important in effecting changes. DLF, Unitech, Omaxe and Ansals groups bagged land banks in the region helped by pro-active policy of the government allowing the private sector to consolidate land for township development. As a city developed by private enterprise, Gurgaon topped the chart on real estate. Global IT companies like Genpact, Dell, Accenture, Hewitt Associates and other sectors representatives- Ciena Corporation, Aicatel, IBM, Hero Honda and Maruti are situated in the city and expect world-class amenities and facilities.   The demand for IT-ITES space is growing day by day, as a result Gurgaon rentals rose 20 per cent and by 2010, per cent arrow will reach at its zenith. At present, Gurgaon has a total space of about 11 million square feet (msf) with about 2 msf of area under construction, with vacancy level below 3 per cent. Many corporate offices and MNC’s are shifting from crowding and expensive Connaught place or other commercial complexes to Gurgaon and developers have succeeded in meeting their expectations and providing them world-class facilities.
Gurgaon , the city, where real estate developers have a tremendous scopes.  Plans to extend Delhi Metro to Gurgaon have been approved. And with one of the best city , support infrastructure being developed to cater for Commonwealth Games. The developer community is gearing to grab to this bringing in space to the tune 20 msf by year 2010.
30 SEZ’s have been approved and around INR 200 billion investments is expected. Haryana has bagged the largest SEZ of the country. The SEZ is projected to serve as an aggregated hub of the world- class infrastructure in northern India and plans to attract 500 companies. Another big achievement of the city’s development is a Japanese city, to be built by Mistui, over an area of 2,000 acres. A large township named Chaudhary Devi Lal Industry Model Township is being developed on over 5,000 acres. The state government also estimates to complete Golden Triangle City Centre (GTCC) in sector 29 with as many as four skyscraper higher than Taipei 101.
 Gurgaon is soon to become a home of exclusive skyscraper buildings. Gurgaon is already sutured as far as real estate development is concerned and property prices are rising constantly.  Due to IT boom, rental returns have already shoot up.
Quality of life in the privately managed residential estate in Gurgaon remains high due to high standards of security, private parking, common area maintenance and sanitation being the norm.  Considering water problem, HUDA has constructed a 70 km water channel from Sonepat to Gurgaon to supply 100 MGD treated water capable of serving up to 16 lacs of people.
The mushrooming shopping malls in Gurgaon are indicative of the recognition by retailers. Mall culture has been dissolved in Gurgaon. Highly paid IT/ Service sector’s employees are keen to enjoy lavish lifestyle and developers are constructing lavish malls.
Much awaited Gurgaon Master Plan 2021 is brining hopes to small residential investors. It will bring 14,930 hectares of land for residential and 1,404 hectares of land for commercial purposes. Gurgaon Master Plan 2021 and and Gurgaon-Manesar 2021  plan will fasten the growth of real estate. At this rate of growth, to own a house in the city will just be a dream for lower and middle class sections simply because the rates are out of reach for them.  With the onset of multi national companies in Gurgaon, the standard of living has considerably improved and as a steady outcome, now more people prefer to buy a property rather than leasing a rented accommodation. This is also one of the reasons behind the burgeoning demand of Gurgaon properties. Gurgaon has ultimate potential for business and residential purpose. The city’s improving infrastructure, business environment, coupled with income and changing lifestyle of the residents are the factors that are encouraging developers to bring international standards in construction.

Research Paper: Securitization Of Real Estate in India

By Dr Sanjay Chaturvedi, LLB, PhD.


Stock markets are securitisation of Ownerships, Mutual Funds is the securitisation of Debt markets, Commodity markets are securitisation of trading process and Real Estate Investment Trust could be the securitised form of Real Estate trading. Many a times, irregulated Real Estate Market feels the dire need for securitisation of Real Estate. Housing finance companies are feeling better after Securitisation Act passed by Indian Government. But process of securitisation still finding difficult in real estate since it is attached with human value. More than 500 Acts and state level Act and regulation governs the real estate transaction.

The major players in the asset securitisation market in India are expected to be commercial FIs, PSUs, Corporate, Government bodies, Mutual Funds, Pension Funds, etc. Securitisation generally pre- supposes that the Originator has a bulk of its assets in the form of self-amortizing financial assets, either with or without underlying security. It is also imperative that these assets should have a clearly established repayment schedule. Moreover, since capital market instruments have a minimum marketable tenure, the receivables underlying the securities should themselves have a sufficiently long tenure, so as not to frustrate the securitisation exercise.

While securitisation started off in the housing loan sector, the development of the securitisation market as a standard funding option across most industries has been the result of a constantly expand- ing universe of securitisable non-mortgage asset types. This lays emphasis on three potential areas of securitisation in India – MBS,


ABS and Infrastructure Sector.

Mortgage Backed Securities (MBS)

The securitisation of assets historically began with, and in sheer volume remains dominated by residential mortgages. The receivables are generally secured by way of mortgage over the property being financed, thereby enhancing the comfort for investors. This is be- cause mortgaged property does not normally suffer erosion in its value like other physical assets through depreciation. Rather, it is more likely that real estate appreciates in value over time. Further,.

>· the receivables are medium to long-term, thus catering to the needs of different categories of investors;

  • the receivables consist of a large number of individual homogenous loans that have been underwritten using standardized procedures. It is hence suitable for securitisation;

>· in the US where it originated, these mortgages were also secured by guarantees from the Government;

>· the receivables also satisfy investor preference for diversification of risk, as the geographical spread and diversity of receivable profile is very large.

In the Indian context, the funds requirement in the housing sector is immense, estimated at Rs. 150,000 crore during the current five- year plan. Of this, it is envisaged that about Rs 52,000 crore would be financed by the formal sector. It is unlikely that this gap can be filled out of budgetary allocation or regular bank credit. Securitisation allows this gap to be bridged by directly accessing the capital markets without intermediation. Securitisation tends to lower the cost at which the housing sector accesses funds. It also facilitates a sufficiently deep long term debt market. It is estimated that about Rs 2,500 crore would be mobilized through the securitisation route during the current five-year plan.

Asset Backed Securities (ABS) – Existing assets

  • Auto loans:

Though securitisation was made popular by housing finance compa- nies, it has found wide application in other areas of retail financing, particularly financing of cars and commercial vehicles. In India, the auto sector has been thrown open to international participation, greatly expanding the scope of the market. Auto loans (including instalment and hire purchase finance) broadly fulfil the features necessary in securitisation. The security in this case is also considered good, because of title over a utility asset. The development of a second hand market for cars in India has also meant that foreclosure is an effective tool in the hands of auto loan financiers in delinquent cases.


Originators are NBFCs and auto finance divisions of commercial banks.

  • Investments:

Investments in long dated securities as also the periodical interest instruments on these securities can also be pooled and securitised. This is considered relevant particularly for Indian situation wherein the FIs are carrying huge portfolios in Government securities and other debt instruments, which are creating huge asset-liability mis- matches for the institutions. Government securities issued domesti- cally in Indian Rupee can be bundled and used to back foreign cur- rency denominated bonds issues. It would more be of the nature of derivative. The subordinated Government securities are intended to absorb depreciation in the value of the rupee thereby protecting to certain extent the senior securities that the Government securities back. The senior securities are directed at the international capital markets and are structured using offshore SPVs by countries like Mexico. Similarly, under the STRIPs mechanism, the interest coupons on the Government dated securities are separated and traded in the secondary markets. Such interest instruments can also be bundled and securitised in the normal asset securitisation method.


  • Others:

Financiers of consumer durable, Corporate whose deferred trade receivables are not funded by working capital finance, etc are Originators of other asset classes amenable to securitisation. Corporate loans, in a homogeneous pool of assets, are also subject to securitisation There is virtually no known instance so far in the United States or in other countries of an ABS transaction having failed. This is despite the fact that the markets for ABS are exceptionally large. Industry experts attribute this to three main factors. ABS transactions are always planned, prepared and carried out with great care. Second reason is the intrinsic value of the paper and in particular the high level of transparency on the quality of the underlying assets. Third, ABS transactions are sponsored generally by large and well known institutions which can’t afford to jeopardies their reputation with investors, the majority of which are institutional investors.


Securitisation of infrastructure receivables

Securitisation of wholesale assets refers mainly to the use of securitisation as a technique for infrastructure funding. The availability of an efficient infrastructure framework is vital to the economic growth and prosperity of any country. Traditionally, infrastructure facilities have been developed and provided by Governments and are looked upon as basic privileges of a citizen and have thus been accorded priority for Government investment. The Central Government has envisaged that more than 40% of the annual central plan outlay would be for the development of infrastructure. ii In the context of India’s size, population, and economic growth, the present infrastructure continues to be inadequate and will require massive incremental in- vestment to sustain economic growth. Hence, the participation of private capital in the development of infrastructure (over and above the Government’s direct involvement) is essential. The India Infra- structure Report submitted by the Rakesh Mohan Committee in 1995 estimated that a total outlay of Rs 400,000 – 450,000 crore would be required for infrastructure financing in the period of 1996-2001. Some of the broad observations outlined in the report in respect of various infrastructure segments are detailed in the table hereunder.

Along with the Government’s earnest attempt at attracting private investment into infrastructure funding, the role of innovative funding techniques such as securitisation is vital. The suitability of security sation for infrastructure funding stems from the fact that cash flows are stable and concession driven, and also because ultimate credit risk (which is central to the concept of securitisation) is partly guaranteed by Government. Securitisation is particularly appropriate at the post-commissioning stage when the project begins to generate cash, with overall project risk being largely replaced by credit risk.

Some of the typical characteristics of infrastructure projects that set them apart from other financing needs are:

Multiple level project risks: Infrastructure financing involves risk participation at multiple levels and is complex to understand for individual investors. The nature of project risk in various stages is vola- tile, it is highest in the pre-commissioning stage and is sought to be mitigated through contractual framework, which is concession driven or provides guaranteed returns. These guarantees and concessions are typically extended by Government and quasi Government organisations and thus minimize financial risk. Unconventional asset cover: Infrastructure projects are typified by the creation of unconventional assets. The assets of an infrastructure project could comprise roads or bridges, jetties and quays in a port infrastructure project, drills and rigs pertaining to an oil well, water treatment plants. These assets are not amenable to resale or reapplication and hence are unacceptable as security cover to conventional lenders. Furthermore, the step-in rights to lenders are non- existent since such projects are awarded on the basis of concession and are on a Build Operate and Transfer (BOT) basis with the “ownership” of such assets resting with the State or Central Government.

Tenure and size of funds required: Infrastructure projects are typically long gestation projects involving high capital outlay and back- ended project returns. The sources of funds would hence have to be long term and provide for a sufficient moratorium.

Securitisation will benefit infrastructure financing because it:

  • permits funding agencies whose sector exposures are choked, to continue funding to those sectors.
  • permits the participation of a much larger number of investors by issue of marketable
  • lowers the cost of funding infrastructure projects; long term funding (a sine quo non for most infrastructure projects) is more feasible in securitised structures than conventional
  • facilitates risk participation amongst intermediaries that specialize in handling each of the component risks associated with infrastructure funding (while these may initially be borne by regular financial intermediaries and insurance companies, it is expected that specialized institutions would develop over time).
  • shifts the focus of funding agencies to evaluation of credit risk of the transaction structure rather than overall project This is because the other components of project risk (as mentioned above) would be borne by specialized intermediaries, at a fee.



Securitisation will grow in future for two significant reasons:

  1. securitised paper is rated more creditworthy than the FI itself
  2. strict capital requirements are imposed on the FIIs

Future trends in securitisation of assets will not only be influenced by those FIs who are knowledgeable about this process, and there- fore, aware of its potential but will also be affected by the level of knowledge in the financial community as a whole as well as the perception of the regulators. While the benefits that securitisation brings in its wake are well documented, it may however, be worth- while to examine whether the domestic financial markets are suffi- ciently developed to accept the product and utilize it efficiently.


Risk Management by Commercial banks in India

The subprime mortgage crisis has brought to light the important of risk management, process and due diligence for real estate credit policies of financial institutions. Following are couple of examples of Indian banks.


Relaxation of NPA and other prudential norms for real-estate In the context of ongoing slowdown in the Indian economy, modifications in NPA norms were necessary as the spillover effects of the global downturn had started affecting the Indian economy particularly from September 2008 creating stress for the otherwise viable units.

The Reserve Bank of India on Friday has that said all accounts which were standard accounts on September 1, 2008 would be treated as standard accounts on restructuring provided the restructuring is taken up on or before January 31, 2009 and the restructuring package is put in place within a period of 120 days from the date of taking up the restructuring package.

The period for implementing the restructuring package has also been extended from 90 days to 120 days in respect of those accounts. The special regulatory treatment will also be available to ‘standard’ and ‘substandard accounts’. These provisions would be in addition to the usual provisions as per the current regulation.


Special Treatment for Commercial Real Estate

Banks can extend exceptional / concessional treatment to the commercial real estate exposures which have been restructured up to June 30, 2009. Presently, exposure to commercial real estate, capital market exposure and personal / consumer loans are not eligible for the exceptional regulatory treatment of retaining the asset classification (of the restructured standard accounts) in the standard category i.e. loans given to real estate, capital market or personal loan segment are declared as a bad loan by the lender at the time of restructuring of the loans. However credit extended to other sectors are not classified as non-performing assets (NPAs) on onetime re- structuring. With the above concessional treatment to commercial real estate restructuring of loans to commercial real estate will en- able a bank to avoid an account from falling into the NPA category. RBI announcement has come as a relief to several sectors of the economy, particularly the commercial real estate sector which the RBI has been viewing suspiciously for a long time.

Classification as Priority Sector Loans-Boost to low cost housing Loans granted by banks to Housing Finance Companies (HFCs) for on-lending to individuals for purchase/construction of dwelling units may be classified as a priority sector loan, provided the housing loans granted by HFCs do not exceed Rs 20 lakh per dwelling unit per family. However, such classification is subject to a cap of 5 per cent of the individual bank’s total priority sector lending. This special dispensation will be available for loans granted by banks to HFCs up to March 31, 2010. This is a win-win situation for banks and small- ticket borrowers. The RBI clearly wants to boost low-cost housing schemes as the loan amount is capped at 20 lacs.

Standardized norms for restructuring debt to real estate companies Commercial banks in the country have asked RBI to declare a standardized norm for restructuring debt to realty companies in order to escape the chances of loans extended to troubled real estate companies to turn into bad loans. Presently, loans given to real estate, capital market or personal loan segment are declared as a bad loan by the lender at the time of restructuring of the loans. However credit extended to other sectors are not classified as non-performing as- sets (NPAs) on onetime restructuring. The real estate firms have been hit hard by the liquidity crunch and are asking banks to rollover the loan, following which CEOs of many banks have asked RBI to relax the restructuring norms of these realty firms. Banks feel that these companies should be given an option of additional line of credit or rescheduling of loans so that their NPAs do not mount up.

Although this concession has been granted to commercial real estate the decision to grant it to the severely hit real estate sector should not be delayed.

Research Methodology: Approach to research project

By Dr Sanjay Chaturvedi

This paper content :


Research Design: 

Research Design – Objectives of Research , – Research Design- solving problems through research / financial aspects of research Design, Selection of subject, Scope, hypothesis) – sources of information – nature of study – Definition – techniques of study – collection, analysis and presentation of data – Validating hypothesis – arriving at results.


Objectives of Research 


  • Exploration
  • Description
  • Explanation


The main reasons / objective why researchers research is finding something for a purpose. In some cases, the purpose is exploration: exploring subject, gaining knowledge on the various aspects of the subject , discovering some of its main dimensions, and possibly planning further, more structured research.

Some research has the purpose of description, as in the Census Bureau’s report on how many Indian House Hold has toilets and accessibility of drinking water,  there are, a Exit poll predicting who will win an election.

Finally, research often has the aim of explanation. In addition to knowing which candidates voters favor, we may go the next step to ask why? What kinds of voters–men or women, young or old–prefer which candidates and why?

This may seem pretty straightforward, but you’ll discover there are some twists and turns in the road. In the case of description, for example, you’ll see that the answer you get often depends heavily on your definitions. What percentage of Indian are “adventurous,” for example? You cannot answer that question without defining what you mean by “adventurous,” and the definition you choose–from among the many possibilities–will move the percentage up or down among a group of people who haven’t changed.

Such variables needs to be defined before setting up the research. Hence a purpose of the research is important to find the variables.

Ironically, we will find that this is less of a problem in the case of explanation. We will see that we might be able to say with confidence what causes people to be adventurous even if we couldn’t agree on what the term meant.

Functions of Research :


  • correct and examples
  • Collect information on subject or undertaking of people lacks or have little knowledge
  • develops and evaluate concepts, practices and
  • evaluates methods that test concepts.
  • obtains knowledge for practical purpose like solving problems on population 1


Research Design

 As we know that any research program is a unit of analysis in the philosophy of science. It was proposed by Imre Lakatos as the focus of a demarcation criterion that depends on the distinction between progressive and degenerating research programs. The scientific evolution of any problem must follow a sequence of steps to increase the probability that it will produce relevant data.

There are many question one must answer before the research starts.

  1. What is the scope of the Research?
  2. Is any previous research conducted on the topic?
  3. Is the topic too broad?
  4. Is Sample Data representative of population?
  5. Can the problem really be investigated?
  6. Can the data be Validated and Analysed?
  7. Is the problem significant?
  8. Can the result of the study be generalised?
  9. What costs and time are involved in the research?
  10. Is the planned approach appropriate to the research?


The set of questions also to be asked for the relevance of the research program:


  1. What type of research has been done in the area previously?
  2. What has been found in previous research?
  3. What suggestions do other researchers make for further study?
  4. What has been investigated?
  5. How can the proposed study add to our knowledge of the area?
  6. What research methods and design were used in previous studies?


Problem solving through research / financial aspects of research Design:

 Research is a process that links the consumer to the marketer through information. Information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications. Research is the systematic gathering, recording, and analysis of data about issues relating to human activities.

The goal of Research is to identify and assess how changing elements of the human activities impacts social behavior. The term is commonly interchanged with market research; however, expert practitioners may wish to draw a distinction, in that market research is concerned specifically with markets, while marketing research is concerned specifically about marketing processes.


Sources of Information:

Primary Date:

  1. Direct Data collection
  2. Interviews
  3. Sample collection at site
  4. Experimental data during research
  5. Governmental Agencies


Secondary Data:


  1. Journals and Magazines
  2. Newspapers and
  3. Research Summaries
  4. Internet
  5. Books on the subject
  6. Direct Interviewing
  7. Sampling of data
  8. Questionnaire and personal


Nature of Study:

Exponential Research

Exploratory / Exponential research is a type of research conducted for a problem that has not been clearly defined. Exploratory research helps determine the best research design, data collection method and selection of subjects. It should draw definitive conclusions only with extreme caution. Given its fundamental nature, exploratory research often concludes that a perceived problem does not actually exist. Exploratory research often relies on secondary research such as reviewing available literature and/or data, or qualitative approaches such as informal discussions with consumers, employees, management or competitors, and more formal approaches through in-depth interviews, focus groups, projective methods, case studies or pilot studies. The Internet allows for research methods that are more interactive in nature. For example, RSS feeds efficiently supply researchers with up-to-date information; major search engine search results may be sent by email to researchers by services such as Google Alerts; comprehensive search results are tracked over lengthy periods of time by services such as Google Trends; and websites may be created to attract worldwide feedback on any subject.


Applied research

Applied research in administration is often exploratory because there is need for flexibility in approaching the problem. In addition there are often data limitations and a need to make a decision within a short time period. Qualitative research methods such as case study or field research are often used in exploratory research.

There are three types of objectives in a marketing research project.

  • Exploratory research or formulate research
  • Descriptive research
  • Causal research


Exploratory research or formulate research: The objective of exploratory research is to gather preliminary information that will help define problems and suggest hypotheses.

Descriptive Research: The objective of descriptive research is to describe things, such as the market potential for a product or the demographics and attitudes of consumers who buy the product.

Causal research: The objective of causal research is to test hypotheses about cause-and-effect relationships.

Ethnography : Interacting closely with the decision makers

Grounded Theory : Putting forth data, integrating them at various levels to develop a theory.

Phenomenology : Seeking data and documenting the same so as to be in a position to explain the causes of various events or thought processes.

Action Research : Moving back and forth between preliminary conclusions to the respondents and studying the responses by decision- makers to the macro level changes.


Definition of terms:

 For better understanding to the reader of the report, terms used in the research report or thesis must be defined. Given below are some of the examples :

Attitude: A feeling or emotion toward a fact. Learn more about employee attitude surveys.

Autonomy: The degree of unsupervised freedom granted individuals to do their work.

Benefits: Company paid or sponsored programs that benefit employees in addition to compensation.

Career Development: Company sponsored programs that prepare employees for advancement within the organization.

Climate: The general mood of the work place.

Communications: The exchange of information relating to one’s work.

Community Involvement: The degree to which the company participates in charitable events.

Company Behavior: The actions or reactions of a company in response to external or internal stimuli.

Company Image: The public perception of the organization.

Compensation: Money received for one’s work.

Competition: Those organizations who provide products or services which, if purchased by the public, reduces the revenue of the company.

Competitive Position: The company’s ability to thwart the efforts of competition.

Control Systems: The means by which the company ensures compliance with policies and procedures.



Techniques of Study

 Concept and Constructs: A concept is a term that expresses an abstract idea formed by generalizing from particulars and summarizing related

A construct is a concept that has three distinct characteristics. First, it is an abstract idea that is usually broken down into dimensions represented by lower-level concepts. In other words, a construct is a combination of concepts. Second, because of its abstraction, a construct usually cannot be observed directly. Third, a construct is usually designed for some particular research purpose so that its exact meaning relates only to the context in which it is found.


Independent and Dependent Variables

For any research, we have to identify relative variables. The variables depend on the nature of environment and interaction and co-relationship with each other.

Variables are classified in terms of their relationship with one another. Independent Variables are systematically varied by the researcher and Dependent Variables are observed and their values presumed to depend on the effects of the independent variables.


Qualitative and Quantitative Research:

Qualitative Research involves several methods of data collection, such as focus group, field observation, in-depth interviews, and case studies.

Quantitative Research also involves several methods of data collection, such as telephone surveys, mail surveys and internet surveys. In these methods, the questioning is static or standardizes.


The Nature of Measurement:

A researcher assigns numerals to objects, events or properties according to certain rules. Quantifying human behaviour is difficult hence event based and probability and analogies are constructed for desired comparison between present and past data.


Validation Technique

Data validation process is most important technique researcher’s adopt while analyzing the data and information. Systematic and tagging for validation of information into various stages and levels of data collections process are defined and validated.


Collection, analysis and presentation of data

Data collection is a term used to describe a process of preparing and collecting data – for example as part of a process improvement or similar project. The purpose of data collection is to obtain information to keep on record, to make decisions about important issues, to pass information on to others. Primarily, data is collected to provide information regarding a specific topic. Data collection usually takes place early on in an improvement project, and is often formalised through a data collection plan which often contains the following activity.


  • Pre collection activity – Agree goals, target data, definitions, methods
  • Collection – data collection
  • Present Findings – usually involves some form of sorting analysis and/or


Prior to any data collection, pre-collection activity is one of the most crucial steps in the process. It is often discovered too late that the value of their interview information is discounted as a consequence of poor sampling of both questions and informants and poor elicitation techniques. After pre- collection activity is fully completed, data collection in the field, whether by interviewing or other methods, can be carried out in a structured, systematic and scientific way.


A formal data collection process is necessary as it ensures that data gathered is both defined and accurate and that subsequent decisions based on arguments embodied in the findings are valid. The process provides both a baseline from which to measure from and in certain cases a target on what to improve.

Other main types of collection include census, sample survey, and administrative by-product and each with their respective advantages and disadvantages. A census refers to data collection about everyone or everything in a group or population and has advantages, such as accuracy and detail and disadvantages, such as cost and time. A sample survey is a data collection method that includes only part of the total population and has advantages, such as cost and time and disadvantages, such as accuracy and detail. Administrative by-product data is collected as a byproduct of an organization’s day-to-day operations and has advantages, such as accuracy, time simplicity and disadvantages, such as no flexibility and lack of control.2


A common goal for a statistical research project is to investigate causality, and in particular to draw a conclusion on the effect of changes in the values of predictors or independent variables on dependent variables or response. There are two major types of causal statistical studies: experimental studies and observational studies. In both types of studies, the effect of differences of an independent variable (or variables) on the behavior of the dependent variable are observed. The difference between the two types lies in how the study is actually conducted. Each can be very effective. An experimental study involves taking measurements of the system under study, manipulating the system, and then taking additional measurements using the same procedure to determine if the manipulation has modified the values of the measurements. In contrast, an observational study does not involve experimental manipulation. Instead, data are gathered and correlations between predictors and response are investigated.


There are four main levels of measurement used in statistics: nominal, ordinal, interval, and ratio. Each of these have different degrees of usefulness in statistical research. Ratio measurements have both a meaningful zero value and the distances between different measurements defined; they provide the greatest flexibility in statistical methods that can be used for analyzing the data. Interval measurements have meaningful distances between measurements defined, but the zero value is arbitrary (as in the case with longitude and temperature measurements in Celsius or Fahrenheit). Ordinal measurements have imprecise differences between consecutive values, but have a meaningful order to those values. Nominal measurements have no meaningful rank order among values.

Because variables conforming only to nominal or ordinal measurements cannot be reasonably measured numerically, sometimes they are grouped together as categorical variables, whereas ratio and interval measurements are grouped together as quantitative variables, which can be either discrete or continuous, due to their numerical nature.

Testing hypothesis Null hypothesis

Interpretation of statistical information can often involve the development of

a null hypothesis in that the assumption is that whatever is proposed as a cause has no effect on the variable being measured.

The best illustration for a novice is the predicament encountered by a jury trial. The null hypothesis, H0, asserts that the defendant is innocent, whereas the alternative hypothesis, H1, asserts that the defendant is guilty. The indictment comes because of suspicion of the guilt. The H0 (status quo) stands in opposition to H1 and is maintained unless H1 is supported by evidence”beyond a reasonable doubt”. However,”failure to reject H0″ in this case does not imply innocence, but merely that the evidence was insufficient to convict. So the jury does not necessarily accept H0 but fails to reject H0. While one can not “prove” a null hypothesis one can test how close it is to being true with a power test, which tests for type II errors.



Stating Result:

The results section is not for interpreting the results in any way; that belongs strictly in the discussion section. You should aim to narrate your findings without trying to interpret or evaluate them, other than to provide a link to the discussion section.

For example, you may have noticed an unusual correlation between two variables during the analysis of your results. It is correct to point this out in the results section.

Speculating why this correlation is happening, and postulating about what may be happening, belongs in the discussion section.

It is very easy to put too much information into the results section and obscure your findings underneath reams of irrelevance.

If you make a table of your findings, you do not need to insert a graph highlighting the same data. If you have a table of results, refer to it in the text, but do not repeat the figures – duplicate information will be penalized.

One common way of getting around this is to be less specific in the text. For example, if the result in table one shows 23.9%, you could write….

“Table One shows that almost a quarter of…..”

Perhaps the best way to use the results section is to show the most relevant information in the graphs, figures and tables.

The text, conversely, is used to direct the reader to those, also clarifying any unclear points. The text should also act as a link to the discussion section, highlighting any correlations and findings and leaving plenty of open questions.

For most research paper formats, there are two ways of presenting and organizing the results. The first method is to present the results and add a short discussion explaining them at the end, before leading into the discussion proper.

This is very common where the research paper is straightforward, and provides continuity. The other way is to present a section and then discuss it, before presenting the next section with a short discussion. This is common in longer papers, and your discussion part of the paper will generally follow the same structure.

Be sure to include negative results – writing a results section without them not only invalidate the paper, but it is extremely bad science. The negative results, and how you handle them, often gives you the makings of a great discussion section, so do not be afraid to highlight them.


If you condense your raw data down, there is no need to include the initial findings in the results, because this will simply confuse the reader.

If you are in doubt about how much to include, you can always insert your raw data into the appendix section, allowing others to follow your calculations from the start. This is especially useful if you have used many statistical manipulations, so that people can check your calculations and ensure that you have not made any mistakes.

In the age of spreadsheets, where the computer program prepares all of the calculations for you, this is becoming less common, although you should specify the program that you used and the version. On that note, it is unnecessary show your working – assume that the reader understands what a Chi Squared test, or a Students t-test is, and can perform it themselves.

Once you have a streamlined and informative results section, you can move onto the discussion section, where you begin to elaborate your findings.




  1. http://wiki.answers.com/Q/What_is_the_function_of_research
  2. http://en.wikipedia.org/wiki/Data_collection
  3. http://www.experiment-resources.com/writing-a-results-section.html

What is Research Methodology ?

By Dr Sanjay Chaturvedi

This paper content :


  1. Concept of Research:

Meaning of research Qualities of Worker-scientific method Definition-stage of scientific study Different step in scientific study logical method inductive and deductive method

– Nature of social phenomena and the use of scientific method.


  1. Meaning of Research

Research is compilation of data, statistics and facts on the subject to prove hypothesis created. It is a validated consolidation of data and information on a given subject to prove and correlate analogies in a scientific and systematic way.

Research is actually Re- search. It is not an invention or innovation. Searching for solutions, amongst the systematic data compilation, in a logical way. Depending on historical data and previous studies on the subject may not give a complete scenario hence primary data through interviews, direct surveys and actual counting is needed. Thus Active Research. Which keep up the pace with time is actual research.

Research is needed when a problem needs a solution. It is by and large for the society and for mass human activities and attitude. Human behavior includes economic activities, social activities and environmental activities. Finding a ways and means for better performance of such activities is Research.

Search conducted by individual or group of individuals in an set of environmental, logical and scientific method with proven or validated or authenticated data and information, is Research.

The research normally have self imposed discipline by creating methodology, hypothesis and research design. The outline, thus, work as boundary for the search work. The document becomes a research when the problem identified is proven on statement of hypothesis. Although, research conducted on a subject becomes factual documentary evidence, it can always be improved upon. Research never ends. It gives beginning and scope for further research.

A broad definition of research is given by Martin Shuttleworth – “In the broadest sense of the word, the definition of research includes any gathering of data, information and facts for the advancement of knowledge.”

Research can be defined as the search for knowledge, or as any systematic investigation, to establish novel facts, solve new or existing problems, prove new ideas, or develop new theories, usually using a scientific method. The primary purpose for basic research (as opposed to applied research) is discovering, interpreting, and the development of methods and systems for the advancement of human knowledge on a wide variety of scientific matters of our world and the universe.1

A researcher must have acumen and indepth knowledge of the subject and known source of information. Good quality research can be produced by only person who knows to apply theorum of Research Methodology to the research work to produce a logical and scientifically proven organised research volumes.

A good researcher must have qualities like

  1. Preservance,
  2. Enthusiasm
  3. Well Informed


The out come of research solely depend on the person’s skills and acumen to judge and analyse the given data and its presentation. A statistical skill also be needed for a good research. Now a days, researcher depend on statisticians for data mining and data ware housing for a desired subject or topic.

Authoritative and alertness on subject gives a razor sharp study a birth from the hands of a good researcher. A good researcher is never satisfied by one or two sources. They always dig a little deeper to find the answers. They also can take the research and convey it in terms that a common person can understand. If you can no longer ask the question “what if “then you have the answer and no longer need to do research.2

2.   Scientific Method :


2.1. Definition:

 Scientific research is an organised, objective, controlled, qualitative or quantitative empirical analysis of one or more variables.

Scientific research relies on the application of the scientific method, a harnessing of curiosity. This research provides scientific information and theories for the explanation of the nature and the properties of the world around us. It makes practical applications possible. Scientific research is funded by public authorities, by charitable organizations and by private groups, including many companies. Scientific research can be subdivided into different classifications according to their academic and application disciplines.

2.2   Stages of Scientific Method

Kerlinger (2000) using definitions provided nearly a century ago by C.S. Peirce, discusses four approaches to finding answers.

  1. Tenacity
  2. Intuition
  3. Authority and


In the method of tenacity follows the logic that something is true becuase it has always been true.


In the method of Intuition, a person assumes that something is true becuase it is “Self Evident”.


The method of authority promotes a belief in something becuase a trusted source, such as parents, news channel or a teacher say it is true.


The scientific method approaches learning as a series of small steps. The truth is found through a series of objective analysis.

Stages of scientific methods :

 First Stage : Defining research study and need for the study. The medium of research. The medium itself have an interest for research. What is it? How does it work? What technology does it involve? The historic data and information on the subject. Need for research and research conducted previously on the same subject.

Second Stage : Research begins once the medium is developed. In this stage specific information is accumulated about the uses and the users of the medium. The developed subject line enhances the chance for further studies and research. The advancement to the original research and continuation to the research in succession.

Third Stage : Includes investigations of the social, psychological and physical effects of the subject. Quantifying the behaviour and occurrence of event or defining probability of occurrence. The process of Research.

Forth Stage : In this stage, Research is conducted to determine how the subject can improved, either in its use or through technological developments.


The stages are not linear, these can be conducted jointly and severally also without any formal steps. Research is a never ending process. In most instances a research project designed to answer one series of questions produces a new set of questions no one thought of before.


2.3   Different step in scientific study:

 Select a Define a question

  • Review existing research and Gather information and resources.
  • Develop hypotheses or research
  • Determining an appropriate methodology / research
  • Collect relevant
  • Analyze and interpret the
  • Present the results in an appropriate
  • Replicate the

Tenets of Scientific Method :


  • Scientific research is public
  • Science is
  • Science is empirical
  • Science is systematic and cumulative
  • Science is predictive


3.   Logical Method :

 Logic is generally accepted to be formal, in that it aims to analyze and represent the form (or logical form) of any valid argument type. The form of an argument is displayed by representing its sentences in the formal grammar and symbolism of a logical language to make its content usable in formal inference. If one considers the notion of form to be too philosophically loaded, one could say that formalizing is nothing else than translating English sentences into the language of logic.


Logic models should assist projects in describing, planning, implementing, monitoring, and/or appraising a project in the most practical manner.

4.   Deductive and Inductive Methods :

 Deductive reasoning concerns what follows necessarily from given premises (if a, then b). However, inductive reasoning—the process of deriving a reliable generalization from observations—has sometimes been included in the study of logic. Correspondingly, we must distinguish between deductive validity and inductive validity (called “cogency”). An inference is deductively valid if and only if there is no possible situation in which all the premises are true but the conclusion false. An inductive argument can be neither valid nor invalid; its premises give only some degree of probability, but not certainty, to its conclusion.


Deductive reasoning, also called deductive logic, is reasoning which constructs or evaluates deductive arguments. Deductive arguments are attempts to show that a conclusion necessarily follows from a set of premises or hypotheses. A deductive argument is valid if the conclusion does follow necessarily from the premises, i.e., if the conclusion must be true provided that the premises are true. A deductive argument is sound if it is valid and its premises are true. Deductive arguments are valid or invalid, sound or unsound.


Deductive reasoning is a method of gaining knowledge. An example of a deductive argument:

  1. All men are mortal
  2. Socrates is a man
  3. Therefore, Socrates is mortal


The notion of deductive validity can be rigorously stated for systems of formal logic in terms of the well-understood notions of semantics. Inductive validity on the other hand requires us to define a reliable generalization of some set of observations. The task of providing this definition may be approached in various ways, some less formal than others; some of these definitions may use mathematical models of probability. For the most part this discussion of logic deals only with deductive logic.3



5.   Nature of social phenomena and the use of scientific method.

 The origin of the survey can be traced back at least early as the Domesday Book in 1086,[34][35] whilst some scholars pinpoint the origin of demography to 1663 with the publication of John Graunt’s Natural and Political Observations upon the Bills of Mortality.[36] Social research began most intentionally, however, with the positivist philosophy of science in the 19th century.

In contemporary usage, “social research” is a relatively autonomous term, encompassing the work of practitioners from various disciplines which share in its aims and methods. Social scientists employ a range of methods in order to analyse a vast breadth of social phenomena; from census survey data derived from millions of individuals, to the in-depth analysis of a single agents’ social experiences; from monitoring what is happening on contemporary streets, to the investigation of ancient historical documents. The methods originally rooted in classical sociology and statistical mathematics have formed the basis for research in other disciplines, such as political science, media studies, and market research.

Social research methods may be divided into two broad schools: Quantitative designs approach social phenomena through quantifiable evidence, and often rely on statistical analysis of many cases (or across intentionally designed treatments in an experiment) to create valid and reliable general claims.

Qualitative designs emphasize understanding of social phenomena through direct observation, communication with participants, or analysis of texts, and may stress contextual and subjective accuracy over generality


Social scientists will commonly combine quantitative and qualitative approaches as part of a multi-strategy design. Questionnaires, field-based data collection, archival database information and laboratory-based data collections are some of the measurement techniques used. It is noted the importance of measurement and analysis, focusing on the (difficult to achieve) goal of objective research or statistical hypothesis testing. A mathematical model uses mathematical language to describe a system. The process of developing a mathematical model is termed ‘mathematical modelling’ (also modeling). Eykhoff (1974) defined a mathematical model as ‘a representation of the essential aspects of an existing system (or a system to be constructed) which presents knowledge of that system in usable form’. Mathematical models can take many forms, including but not limited to dynamical systems, statistical models, differential equations, or game theoretic models.4




  1. http://en.wikipedia.org/wiki/Research
  2. Freshwater, , Sherwood, G. & Drury, V. (2006)
  3. http://en.wikipedia.org/wiki/Logic

4, http://en.wikipedia.org/wiki/Social_science

Editorial: But Pappu can’t Sell Sala

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By Dr. Sanjay Chaturvedi, LLB, PhD.

In boom time everything sells. But in recession and hard times only skills and brand make sale happen in real estate. Most unfortunate happening happened in real estate when an ordinary sales executive who knows how to talk big got annual package worth more than his seven lives would have earned. A package of Rs.1.5 crore per annum is what is got for just making just nothing but production of doing something. The develop thought, I am having 40 flats to be sold at Rs.25 crore each and if I pay commission of 2% on such inventory, I would still save lot of money even if its 1.5 crore package. Just for coordination of sale process and giving report of aggregated reports sent from site or arranging a cabrey dance or mushayra for brokers, the annual package was a lottery or a jack pot he successfully negotiated with the developer.

Now is the time of showing skills. When International economies are in doll drum and National exchequers are finding it difficult to cope up with rise dollar cost and cost of inflation, it is beyond his capacity to understand the situation. He was never trained for such situation. It was like a hindi saying, “Allah mehrban to Gadha pehlwan”. The global melt down and liquidating markets, observed as D-Coupling theory, have severely affected the real estate market too. Those who started their career after 2001, had never seen a slump in the market. Its pay back time for Rado watch and Gucchi perfumes.

The honeymoon is over. Its time to pay the bills. Many of them now thinking that they are really that much worth and wants to leave the job and start their own company for brokering business. Some of the fly-by-night operator who managed to take some slum projects, matured it till LOC and wants to sell the project along with LOC. They never sure to act like a middleman and margin hunters.

The most unprofessional and bad administrators got crown on their head since developers never had opportunities to hunt for a better talent. The conventional way of doing business will now cost them dearer. The Gadha Prasad, who is use to Rado watch and Gucchi Perfumes will be an liability on the organisation and will severely damage the brand he represents. Talking good English and having computer operational knowledge now needs some thing more and that is negotiation skills.

It comes only when you are well informed and know how to negotiate a better deal for the organisation. Pappus like these are there in every big builder’s organisation and looting them for crores of rupees by just doing eye wash. In return, builder’s are passing on these ransoms to poor flat purchasers. Pappu just can’t sell, it is the brand or product it self which is selling.