The government plans to give a boost to the housing market to revive over 1600 stalled housing projects covering 4.58 lakh units.
"A special window will be made, that will be an alternative investment fund (AIF). The government will first fund Rs 10,000 crore. There will be participation from SBI and LIC to place funds. The total funding from the government and SBI and LIC put together is expected to have a starting value at around Rs 25,000 crore," said Finance Minister.
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.
The minister said over 1,600 housing projects are stalled and about 4.58 lakh housing units are stuck in it. She said the fund will be set up as a Category-11 AIF (Alternate Investment Fund) debt fund registered with SEBI and would be professionally run.
"For these incomplete projects, we will put money into an escrow account. Those incomplete projects registered with RERA will get funded for the last finishing projects after assessing their net worth if it is positive. The money will be given in stages. So, people will not have to worry about projects getting completed or not," she said.
The cheer in the domestic stock market comes after Finance Minister Nirmala Sitharaman on Wednesday announced that the Union Cabinet had approved a Rs 25,000-crore fund for stalled middle and low-income housing projects.