Finance Minister Nirmala Sitharaman briefs media on housing issues (Photo Credit: PTI)
The government on Wednesday approved setting up of a Rs 25,000 crore bailout fund to finance 1,600 stalled housing projects as it looks to boost the economy by kickstarting incomplete projects.
The decision was approved by the Union Cabinet at a meeting held on Wednesday under the chairmanship of Prime Minister Narendra Modi. Announcing the decision, Finance Minister Nirmala Sitharaman said the government will put in Rs 10,000 crore in this alternative investment fund (AIF) while SBI and LIC would provide Rs 15,000 crore, taking the total size to Rs 25,000 crore.
This will finance 1,600 stalled housing projects comprising 4.58 lakh housing units across the country, she added. The move is aimed at generating employment as well as reviving demand of cement, iron and steel industries. It is also aimed at relieving stress in the major sectors of the economy.
The fund size would increase as sovereign and pension fund are expected to participate in this AIF. The AIF can be utilised even by the projects which have been declared non-performing assets or are facing insolvency proceedings, Sitharaman added.
Here are the highlights of the press conference:
8.10 pm: The Special Window would provide funds to stalled housing projects enabling them to complete unfinished projects and consequently ensure delivery of homes to a large number of home-buyers.
8.08 pm: The special window, in due course, help relieve the financial stress faced by a large number of middle class home buyers who have invested their hard earned money.
8.06 pm: Special Window will also restore trust between buyers and developers and boost the sentiments of the housing sector as a whole and release large amount of funds stuck in these projects for productive use in the economy.
8.04 pm: The creation of special window for affordable and middle income housing projects would revive the real estate sector and generate considerable employment.
8.02 pm: Besides, revival of the sector will also lead to demand of Cement, Iron & Steel Industries giving further impetus to generate more employment.
8.00 pm: This initiative will have a positive effect in releasing stress in other major sectors of the Indian economy as well.
7.59 pm: Finance Minister Nirmala Sitharaman said that 4.58 lakh housing units in 1,600 projects are stuck across the country.
7.57 pm: Real estate fund to take up projects if net worth positive, fund to also help projects that are NPAs: Finance Minister
7.53 pm: Government pledges about Rs 10,000 crore under a Alternative Investment Funds (AIF) scheme for rescuing at least 1600 stalled housing projects. This will benefit at least 4.8 Lakh housing units which have been stalled due to lack of funding: FM Nirmala Sitharaman.
7.52 pm: Cabinet approves establishment of 'Special Window' to provide priority debt financing for completion of stalled housing projects in the affordable and middle-income housing sector: Nirmala Sitharaman.
7.51 pm: Approx 4.58 lakh housing units stuck in India, says Finance Minister Nirmala Sitharaman.
7.50 pm: More than 1600 housing project are stuck, says Finance Minister Nirmala Sitharaman.