Budget 2023: NAREDCO seeks Rs 25,000 cr real estate fund from FM

Industry body the National Real Estate Development Council (NAREDCO) has demanded reintroduction of the SWAMIH investment fund in the upcoming Union Budget, expected to be tabled on February 1, to help completely stuck projects on a priority basis.

In a letter to the Finance Minister (FM) Nirmala Sitharaman, the body also sought the extension of the scheme to new projects. Emphasising on the need to widen the ambit of the scheme, NAREDCO has recommended inclusion of stress-free projects and commercial projects to the list of beneficiaries.

To begin with, NAREDCO has recommended provisioning of at least Rs 25,000 crore for the proposed second phase of Special Window for Completion of Construction of Affordable and Mid-Income Housing Projects (SWAMIH) investment fund for FY2023-24. The first phase of the fund - SWAMIH-1 - was launched by the Finance Minister in November 2019. Sponsored by the Finance Ministry and managed by SBICap Ventures Ltd., a State Bank Group company, SWAMIH-1 had a total corpus of Rs 15,530 crore.

The apex industry body, which comes under the aegis of Union Ministry of Housing and Urban Affairs, has also recommended that the fund should support complete project funding without factoring the sales inflows. It also suggested that under the special purpose fund, funding should be provided to all projects irrespective of their risk rating, however, with close monitoring of projects and airtight processes.

“The SWAMIH Fund was one of the most innovative and effective tools which helped solve the problem of last mile funding of stalled housing projects to a great extent, bringing relief to several distressed home buyers. Extending the duration and expanding the scope of this fund would do wonders. Allocation of at least Rs 25,000 crore for next fiscal alone shall boost the economy, create more jobs and attract huge investments,” said Rajan Bandelkar, President, NAREDCO.

SWAMIH-1 Investment Fund was formed to complete construction of stalled, brownfield, RERA-registered residential developments that are in the affordable housing or mid-income category, and are net worth positive and are in need of last mile funding for completion of their construction.

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