In a major decision to provide relief to home buyers and the real estate sector, the union cabinet on Wednesday approved establishment of 'special window' to provide priority debt financing for completion of stalled housing projects in the affordable and middle-Income Housing sector with the government acting as the sponsor of the fund and infusing funds up to Rs 10,000 crore.
Addressing a press conference after the cabinet meeting, Finance Minister Nirmala Sitharaman said the fund will provide relief to developers with unfinished projects and ensure delivery of homes to buyers.
She said State Bank of India, Life Insurance Corporation and other institutions will make further contributions and the corpus of the fund will go beyond Rs 25,000 crore.
"There are also sovereign funds which are interested. The funds received from the corpus cannot be used to repay prior dues to banks," she said.
The Special Window will provide last-mile funding to projects whose net-worth is positive, affordable and middle-income housing project and ongoing projects registered with RERA (Real Estate Regulation and Development Act).
It will also include stressed projects classified as NPA (non-performing asset) and pending in NCLT (National Company Law Tribunal).
She said over 1600 projects were stalled and 4.58 lakh housing units were stuck.
The minister said the move will help relieve financial stress faced by a large number of middle-class homebuyers who have invested their hard-earned money in housing projects.
"The main intention is to complete the stalled projects in the affordable and middle-income housing category," she said.
( With inputs from ANI )