India approves $1.4bn to revive stalled housing projects |
In a long¬ awaited booster package for the realty sector, Indian government on Wednesday announced the setting up of a Rs 25,000 crore alternative investment fund (AIF), aimed at providing relief to developers with unfinished projects to ensure delivery of homes to buyers. Analysts believe the move will be strongly welcomed by the market. Announcing the package, Finance Minister Nirmala Sitharaman said while the government has earmarked Rs 10,000 crore towards the fund, Life Insurance Corporation and State Bank of India would also infuse money. The Finance Minister in a media briefing said that many sovereign funds have shown interest in the AIF, which will be managed by SBICAP Ventures. Dalal Street experts said the real estate sector, which has remained neglected for long, may finally come out of stress. According to experts, this is a positive move for the realty sector and will solve the problem of NPAs in finance companies on one end, and act as a catalyst for de¬-inventorisation on the other. As per government`s estimates around 4.58 lakh housing units are stuck in India with over 1,600 stalled realty projects. In a late evening decision on Wednesday, the Cabinet also approved the establishment of a `Special Window` to provide priority debt financing for completion of stalled housing projects in the affordable and middle ¬income housing sector.
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