FM Nirmala Sitharman on Wednesday announced a slew of measures to tackle the slowdown in the economy because of the Lockdown.
By Varun Singh
After PM on Tuesday announced a total of Rs 20 lakh crore worth package to boost the economy.
The FM on Wednesday drew out the roadmap of how the government plans to bail out the economy.
It looks like the FM managed to touch the right notes, making the real estate industry feel good.
The announcement was much in line with the government’s aim to spur economic growth and build a ‘self-reliant’ India.
In the first of the series of announcements the FM will make over the next few days, the real estate sector, NBFCS/HFCs and MSMEs got a major boost on day one.
In a major announcement providing relief to real estate developers, the government has extended the timeline for project completions and registration by 6 months.
This is a big move that will destress developers significantly, since construction activity had been halted all across the country.
“Homebuyers’ wait for their homes will get extended by this move, but this was in any case inevitable,” Anuj Puri, Chairman, Anarock Property Consultants.
Further, the announcement of Rs 30,000 crore special liquidity scheme for NBFCs/HFCs and MFIs will ease liquidity woes of stressed players.
This will benefit the real estate sector significantly, given that NBFCs and HFCs are major lenders to it.
As per ANAROCK research, NBFCs and HFCs together contribute almost 56% of total lending to real estate in India currently.
Alok Saraf, Associate Partner, Grant Thornton Advisory Pvt Ltd says that the provision of Suo Moto extension of due dates under RERA will definitely benefit developers whose projects were due for completion during the lockdown. The real estate sector continues to be hopeful for a credit guarantee scheme similar to the one being provided to the MSME sector announced by our honorable FM.
Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory says, “Invoking of force majeure clause for registered real estate projects will protect the interest of developers, by extending the completion timeline by a duration of 6 months under RERA automatically. The same was much required, as a lot many developers could face challenges of aligning construction workers and labourers for the next few months as a result of their migration.”
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