India’s plan to set up a Rs 25,000-crore ($3.5 billion) fund to salvage stalled residential projects will only be sufficient to complete about 6% of constructions that are running behind schedule in Asia’s third-largest economy.
The new program announced by Finance Minister Nirmala Sitharaman on Wednesday is an improvement on a $1.4 billion real-estate corpus announced in September and, unlike the previous plan, it will also support projects written off by lenders as bad loans. With $63 billion of housing projects stuck for lack of funds, the latest measure will help unclog the financing pipes, said Anuj Puri, chairman of Anarock Property Consultants.
The fund size isn’t enough to cover the entire problem but will act as a “lubricant to start the wheel that had been jammed,” Puri said in an interview to BloombergQuint. Once projects are revived and completed, money will start circulating in the system, which will h
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