Indian Finance Minister Likely to Approve $1.35 Bln for Stalled Residential Housing Projects

New Delhi (Sputnik): Finance Minister Nirmala Sitharaman has been holding meets with various sectors of the economy over the past few weeks, meeting jewellery and other exporters, and central public sector enterprises, among others. After these meetings, the government may announce an additional stimulus for the COVID-19-hit economy.

Indian Finance Minister Nirmala Sitharaman will hold a review this week of residential real estate projects in which construction activity has stopped due to lack of funds. Sources in the Finance Ministry have also indicated the minister is likely to announce support in the form of an additional $1.35 billion to the real estate fund meant for reviving such projects.

A source close to the development told Sputnik, "Finance Minister Sitharaman has been holding meetings with various sectors of the economy. She will probably hold a review on the funding needs of residential housing projects in which construction activity has stopped due to lack of funds. A further allocation of $1.35 billion to a fund dedicated to such projects is likely to be announced by the finance minister soon".

The real estate fund was announced by FM Nirmala Sitharaman in November of last year to revive stalled housing projects. In India, as per industry estimates, about half a million apartments in 1,509 residential projects are in this category.

"A large number of real estate projects have been stalled across the country for over a decade. The projects got stuck as the builders did not bother to begin construction even after raising the booking amounts from consumers. Instead of building the flats for which they have raised money from buyers, the builders would purchase land parcels. This happened for a long time without any government regulation leaving the buyers in the lurch", said Rajesh Kumar, a homebuyer, who has been waiting for his dream home for the past ten years.

The government’s real estate fund has come to the rescue for such buyers. As per data from the Indian Ministry of Finance, 140 residential projects across fifteen cities have benefited from the fund.