NAREDCO, the Realtors' Association, has asked the government for one-time loan restructuring and last-mile finance for stalled projects to preserve the real estate sector from the liquidity crisis caused by the epidemic.
On 15th July, a team led by NAREDCO-Uttar Pradesh Chairman R. K. Arora met with Finance Minister Nirmala Sitharaman in this respect. It further asked that the suspension of some elements of insolvency legislation be extended for another year. NAREDCO stated in a statement that it sent a memorandum to the government outlining different real estate industry expectations to tackle the challenges posed by the pandemic and the protracted lockdown. According to Arora, the team notified the finance minister of the severe liquidity situation in the real estate industry as a result of the epidemic. "All real estate projects are on the verge of failure, and unless the government supports the industry, project implementation will come to a halt," according to the statement. NAREDCO requested that the minister order the RBI to conduct a one-time rollover/restructuring of project loans provided by banks and financial institutions. According to Arora, the group also highlighted the need for last-mile finance to complete delayed projects, who added that more than 4,000 projects require such money.
"Because current lenders are not waiving their charge against existing loans and are not providing NOC, developers are deprived of the advantage of the planned SWAMIH Alternative Investment Fund," according to the statement. NAREDCO proposed directing current lenders to offer last-mile finance along the lines of the SWAMIH fund.
SWAMIH, a Rs 25,000 crore stress fund, was established by the Centre in 2019 to finish delayed projects.
The association also informed the minister of the difficulties being experienced by the real estate sector as a result of proceedings initiated against them under Sections 7, 9, and 10 of the Act (IBC). When the pandemic struck in March 2020, the execution of these parts was delayed for a year, which expired in March 2021.
"Because the second Wave of COVID-19 has touched all real estate developments on a far larger scale than the first Wave, a one-year time extension for IBC implementation is required," Arora added. According to the organisation, the finance minister told the delegation that their concerns would be considered carefully.
Comments