On July 15, a team of developers led by RK Arora, chairman of Supertech Group and president of NAREDCO, met with Finance Minister Nirmala Sitharaman and presented a memorandum outlining their requests. The real estate developers have requested to order the Reserve Bank of India to adopt a one-time rollover of issued project loans by banks and financial institutions, finance to complete delayed projects and extension of some provisions of insolvency law by a year.
According to Arora, the team told the finance minister about the real estate sector's liquidity difficulties as a result of the COVID-19 epidemic and the extended lockdown. All real estate developments are on the verge of collapse, and unless the government supports the business, project implementation would come to a halt, he added.
The delegation also requested the finance minister to instruct current lending banks to offer last-mile funding in the SWAMIH AIF model.
Over 4,000 projects in the country require last-mile support. The developers are deprived of the benefits of the proposed SWAMIH Alternative Investment Fund since existing lenders are refusing to release their charge against existing loans and are refusing to give NOC, according to the statement.
The finance minister was told of the challenges that the real estate sector is facing as a result of the actions brought against them under Sections 7, 9, and 10 of the Insolvency and Bankruptcy Code of 2016 (IBC). The execution of these provisions was postponed for a year, from March 2020 to March 2021.
"As the second wave of COVID-19 has impacted all real estate developments on a far larger scale than the first wave, it is important to allow for a one-year extension in the implementation of IBC," Arora stated.
According to the organisation, the finance minister told the delegation that their concerns would be considered carefully.
Source: Money Control