The government has allocated Rs10,000 crore to set up an alternative investment funds (AIFs) for revival of stalled housing projects. Besides funds from government, Life Insurance Company (LIC) and State Bank of India (SBI) will also contribute money towards the AIF, put together fund is expected to reach Rs25,000 crore. Government is also in talks with sovereign bonds and pension funds to put in money in AIF further.
According to government, there are about 1,600 stalled housing projects, consisting of about 4.58 lakh units across the country.
Only those projects will be considered for funding, where unit price is less than Rs2 crore in case of Mumbai, units price are less than Rs1.5 crore in case of cities like Delhi, Kolkata, Pune, Hyderabad and units price are less than Rs1 crore for all other cities.
Besides, that project has to be registered under Real estate (regulation and development) Act, and it should be net-worth positive, to get funding from the AIF.
Even those projects which had been declared non-performing assets (NPAs) or cases has been filed against the projects in National Company Law Tribunal (NCLT) will get funded, provided NCLT has not yet ordered for liquidation of the project.
Funds sanctioned for the stalled project will get transferred to an escrow account, money will be released as per the assessment and progress of construction.