In the first of the series of announcements by Finance Minister Nirmala Sitharaman to spur economic growth and build a ‘self-reliant’ India, the government has offered a “major” boost to the real estate sector, NBFCS/HFCs, and MSMEs, Anuj Puri, chairman, Anarock Property Consultants said.
“Providing major 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 de-stress developers significantly since construction activity had been halted across the country. Homebuyers’ wait for their homes will get extended by this move, but this was, in any case, inevitable,” Puri added.
Further, he notes that 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.”
In another major move to revive the MSMEs, the FM tweaked the definition of such companies to provide benefits to many more units. The collateral-free automatic loan for MSMEs worth Rs 3 lakh crores will give a lifeline to nearly 45 lakh units for 4 years. “With this, the government aims to curtail job losses, and this could indirectly benefit affordable housing. Fear of job losses may have caused many potential affordable home buyers to defer their purchase decisions,” Puri observed.