The real estate sector may soon get a boost as the Centre readies a package to help renew growth, as per a Business Standard report.
The package, aimed primarily at home buyers and real estate developers, is expected this week, the paper quoted government officials as saying.
“There have been discussions on a task force for real estate similar to the one for infrastructure projects announced last week. The finance minister spoke about promoting rental housing sector. A new policy is in the works,” one of the officials told BS.
Measures being considered include the creation of a task force, easing of interest subvention norms, new rental housing policy, lifting the affordable housing category cap, cutting processing time for housing applications under partial guarantee scheme, and expanding credit reach to small exporters, they added.
The task force will identify and revive stalled projects while the recent circular by the National Housing Board (NHB), prohibiting interest subvention for housing loans, would be under review.
Finance Minister Nirmala Sitharaman might also lift the affordable housing category cap in metro cities from the present Rs 45 lakh to Rs 1 crore.
The development follows long-standing demands for regulatory and tax changes as the sector suffered a steady decline in demand and a sharp liquidity crunch over the past four years.
Sitharaman, in her budget, proposed “several reforms to promote rental housing … a model tenancy law to be finalised and circulated to the states.”
While announcing the first set of economic measures on August 23, Sitharaman also promised two more packages. The expectations are stronger after the finance minister and Urban Development Minister Hardeep Puri met with industry representatives.
Apart from real estate, the other anticipated announcement is goods and service tax (GST) e-wallet provision for exporters, the report added.
In June, Commerce and Industry Minister Piyush Goyal said that exporters should be able to take more and more export credit in foreign currency. The ministry is now looking at raising the share of foreign currency in total export credit much beyond the present level of about 50 per cent.
“The same has been forwarded to the RBI for consideration as its foreign exchange reserves can be used for providing a line of credit for swap to good banks for this purpose. This will result in cheaper foreign currency loans,” a senior official said.
The ministry has also discussed in detail the possibility of easing norms for banks when it comes to lending export credit by extending the cap on banks from the present two percent, the official pointed out.