Govt's real-estate push: Rs 25,000 cr alternate fund for 1600 stalled projects

In a big relief for home-buyers, the union cabinet Wednesday approved setting up of an Alternate Investment Fund (AIF) for stalled housing projects. The government, along with the largest money-lender State Bank of India (SBI), and LIC will infuse Rs 25,000 crore for funds to revive stalled housing projects, said union finance minister Nirmala Sitharaman after the cabinet meeting in the national capital.

The alternate funding mechanism termed the 'Special Window' will benefit 4.58 lakh home-owners of 1,600 stalled housing projects, the finance minister said.

Of the 25,000 crore funds, the government will invest Rs 10,000 crore to provide relief to developers with unfinished projects and ensure delivery of homes to buyers in the Affordable and Middle-Income Housing sector.

The funds will be released in phases, Sitharaman said, adding that housing projects that are NPA or in bankruptcy court NCLT can also be funded by the Rs 25,000 crore alternate real estate fund. Many housing projects, including the scam-hit realty developer HDIL are facing insolvency proceedings in the NCLT.

The alternate real-estate funding will also generate employment, revive demand of cement, iron and steel industries, and relieve stress in major sectors of the economy, Sitharaman said.

Earlier, on Tuesday, the finance minister said the government is working on some sops for the real estate sector, particularly for home buyers, and support to senior citizens in the wake of the decline in interest rates.

Speaking at the Express Adda, Sitharaman said "In real estate, we have started working on some proposals… we will have an offer for home buyers."

(Inputs from The Indian Express)