Rahul Nahar Chairman XRBIA Developers Ltd on FM’s Stimulus Boost
It is noticeable that all is not well with the Indian economy as it seems to be in trouble with the lowest GDP growth of 5 per cent in the last six years. India has the world’s one of the highest young working population and hence it is crucial to boost the slowing economic growth of the country in order to improve the confidence of consumers. Real Estate among others is a major sector that is facing the impacts of the slowdown, however, with the recent announcements by our Finance Minister, the sector is expected to gradually get back on track with positive sentiments.
Finance Minister Nirmala Sitharaman announces a range of initiatives in a hope to revive the slowing economic growth of India. The announcement of infusion of Rs70,000 crore along with additional liquidity of Rs 5 lakh crore being made available to the banking sector is a welcome move for the real estate sector; which has been witnessing a stagnant growth since quite some time now. Increase in the liquidity support to housing finance company from Rs. 20,000 crore to Rs. 30,000 crore will help in stimulating the housing finance sector. It is also observed that banks have not passed the benefits of repo rate cut by Reserve Bank of India to the customers, but now with FM’s announcement, banks will have to immediately pass on the benefits to home buyers which will, in turn, improve the house buying trends and the overall sentiments of the consumers.
It is a big relief for developers who are into affordable housing and middle-income housing projects as the government has announced Rs 10,000 crore special window to provide last mile funding for the completion of ongoing projects in the category of affordable and middle-income projects. This amount is expected from outside investors such as LIC and other financial institutions. Another important move is a relaxation of External commercial borrowing (ECB) guidelines that will help developers obtain overseas funds for completion of their projects on time.
Lack of funds has been one of the major hurdle faced by the developers over the last few years. The announcements made by the Finance Minister will help the real estate players get easy access to liquidity and to complete their projects on time. This will in turn help boost the confidence of home buyers; therefore, improving the demand-supply dynamics. It will also lead to timely repayment to lenders, ensuring a smooth restoration of the sector.
The inclusive approach by the government will certainly help the economy which is currently facing a deep crisis. In another 4-6 months, w can expect the economy to start showing signs of recovery and we have our trust in the same. These steps will give the much-needed impetus to the sluggish Indian economy. Also, we hope that the real estate sector will once again witness a boon by being strengthened with the recent reforms of the government. All these efforts in various sectors will cumulatively help drive growth and uplift and achieve the objectives of the country.
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