SME Times News Bureau | 24 Aug, 2019
In a relief to home buyers, Finance
Minister Nirmala Sitharaman Friday said that the government is working
on a solution to get the stalled housing projects completed.
steps to boost the economy in a press meet, the minister said that
the measures for the distressed home buyers would be announced next
week along with other steps.
The announcement comes days after
the minister and Finance Ministry officials met stakeholders of the
country's real estate market, including developers, realty associations
and home buyers.
In the meeting on August 11, liquidity problems
and completion of stalled projects were discussed whereby the developers
suggested the creation a stress fund for completion of stalled
The home buyers' association, Forum For People's
Collective Efforts (FPCE), in its letter to Sitharaman had said that the
stalled projects can be solved with a stress fund of at least Rs 10,000
same time, the minister added that National Housing Bank (NHB) would
provide additional Rs 20,000 crore to HFCs, taking up the total liquidity
support to Rs 30,000 crore.
She also said that partial credit guarantee scheme announced in the budget for
purchase pooled assets of non-banking financial companies (NBFCs) and HFCs upto
Rs 1 lakh crore will be monitored at the highest level in each bank.
Further, in a move which would ease home loan interests, she said that banks
would come with repo rate linked loan products.
Commenting on the development, Shishir Baijal, Chairman and Managing Director,
Knight Frank India said: "The release of funds for the PSUs and the credit
support HFCs as well as the NBFCs will provide some relief to the financial
sector currently under pressure on account of NPAs. We expect these measures to
have impact on the stressed assets that are awaiting completion."
For the real estate sector specifically, the alignment of the bank lending
rates to the repo rate will have significant impact, he added.