Lok Sabha Question No. 1364 (UNSTARRED), answered on 2020-09-19
Subject: Affordable Rental Housing Complexes
Ministry: FINANCE
Asked by: Arjunlal Meena, P.P. Chaudhary, Kaushal Kishore, Devji Mansingram Patel

## GOVERNMENT  OF INDIA MINISTRY OF FINANCE DEPARTMENT  OF ECONOMIC  AFFAIRS

LOK SABHA ro B E AN SW E RE D o N,,#Ht$:[:B."offi  :ll?) it"r r]ifll d ra pa  d

## Affordable  Rental Housing Complexes

## QUESTToN

## 3ii1 JJttrfi:AHJiT LAr MEENA:  sHRr p.p.cHAUDHARy:  sHRr KAUSHAL  KrsHoRE:

Will the Minister  of FINANCE  be pleased  to state:

- .  stePs which the Government ke land avairabte  for Affordabre  Rentat Housing comprexes; (a) the details going  to take in order to ma is
- (b) the manner in which the Governmen-t  is planning  to sotve liquidity issues  for the cash strapped housing finance  market  in wake or covio-rg;
- (c) the details  of incentives  which the Government  is planning  to provide  to the  ppp  scheme paftners  under Affordable  Rental Housing  Corpi"*"r;
- (d) whether it is a fact that the Government  has set a very ambitious  target of catering  to a range interests,  from  students  to tabourers  and  even tourists and the Government  will categorize  these complexes  and the renis accirdingly;  and
- (e) if so, the details  thereof?

## ANSWER MINISTER OF STATE IN THE MINISTRY OF FINANCE (Shri Anurag  Singh Thakur)

- (a) The Affordable  Rental Housing.  comptexes  (ARHCs)  scheme -is  .b"!ng  implemented  by adopting  two models' Under ttloa6l-r,  tri"-"*irting  cove.nmeni funaea vacant houses are proposed  to be converted  into ARHCT uv .rgugi;'g con.essionaire  on Repair/Retrofit,  Develop, operate and Transfer (RDor)\_-Model'  ;d;;fi;g ,transparent  procedures.  Under Moder-2, Private/Public  Entities would construct,  operaie a-nd uainlain nhrics on their own vacant land. Therefore'  under  both models, Governmlnt  aoes require  to make land accessible.  However, various incentives/benefits  will be provided  by the Government  oi inaia as welt as States/Union Territory (ur) Governments  to make the ,.t'l"r" attractive  for  public/private agencies  to pafticipate.
- (b) The following  measures  have been undertaken inter-alia  to cater to the liquidity issue of the Housing Finance  companies/Housing  s".to.rcormercial  Real Estate  Sector in the wake of COVID.19:
- (i) Partial  credit.Guarantee  Scheme 2.0 ' Government  issued partial  credit Guarantee scheme (PGGS)  on 11th December 2oLg onering  to"t"hiri'ro* covernmeni'or  India guarantee  to  public sector Banks (PS-B:)  for purch"ting  pooled  assets  rroT,.1'1q"J"ilv  ,ornd Non-Banking  Financiar companies (NBFCs)-and  iJousing  rinancta";;;;ies (HFCsi.  i, dn" wake of covrD-19,  as paft

a 28,  Ls 42( sa ka  )

of Atmanirbhar  Bharat  Abhiyan, the said Scheme has been extended on 20th May 2020 to cover poftfolio guarantee  of up to 2Oo/o  of first loss for purchase  by  pSBs  of Bonds or Commercial Papers (cPs)  with a rating of AA and below (including  ,nrit"d paper with original/ initial maturity  of up to one year) issued by NBFCs/ HFCs/M-icro  Finance Institutions (MFIs). The amount of overall guarantee provided under the extended Scheme shall be limited to 100/o of fair value of assets  or 2oo/o of the face value at crystalized  Portfolio  Level of the Bonds/Cps  being purchased  by the Purchasing Banks under this Scheme, or an overal amount of Rs. 10,000 crore taking into account alt the guarantees provided under the Scheme  to all  purchasing  Banks, whichever  is lower.

(ii). .Special  Liquidity Scheme (sLS) for NBFCs/HFCs  - As part of the Aatmanirbhar  Bharat Abhiyan,  the Government  has approved  the special Liquidity scheme for NBFCs and HFCs to improve their liquidity position.  Under the Scheme, a bpecial  purpose  Vehicle (SpV) viz SLS Trust has been set which would issue interest bearing 'rp"ii"i iecurities guaranteed  by the Government  of India, t9 be purchased  by Reserve Bank of India (RBI) only. The proceeds thereof are being used by the SPV to acquire the debt of at least investment grade of short duration (residua.l  maturity of upto 3 months, and can be extended  for the same or for a reduced period  upto the d.ate of maturity)  of eligible Nercs  /  HFCs. The spV would issue securities  as per requirement subject to the total amount  of securities  outstanding  not exceeding  Rs. 30,000 crore to be extended by the amount required as per the need.

(iii) Special  Refinance  Facility Scheme  - Reserve Bank of India has provided  a Special Liquidity Facility (SLF)  of Rs.10,oo0 crore to National Housing  Bank (NHB)  io enable it to infuse liquidity i1!o tftg.housing  sector through Housing  Finance  companiei  (nFcs) as also other  pLIs  at more affordable rates and to meet the credit needs of the sector. Aicordingty,  National Housing Bank h.as launched Special Refinance Facility (SRF)  scheme to provide short term refinance  support to HFCs and other eligible PLIs. In August-2o2o,  RBI has provided  an additional  standing liquidity facility (ASLF)  of Rs. 5,000 crore to NHB - over and above ns.rb,o00 crore alrealv  provided for suppofting HFCs.

(iv)-Housing Finance Companies are atso among the beneficiaries  of Reserve Bank of India (RBI)'s attempt to -injelt liquidity  in the financial  iystem through the Targeted Long-Term  Repo Operations (TLTRO)  1.0 and TLTRO 2.0.

(v) Classification.into Priority Sector.Lending  (PSL)  - Bank credit to registered NBFCs (other than MFIs) for on-lending  to\_ housing  has been mlA'e eligible  for classification  as priority sector up to a limit of five percent  of individual bank's total priority sector lending and up to Rs. 20 lakh per borrower for housing.

(vi) Projects under implementation  in Commercial  Real Estate Sector (CRE) - For projects in CRE sectors, RBI has permitted  revision of the Date of Commencement of Commerciai operations (DCCO)  and consequential  shift in repayment schedule for equal or shorter duration without treating  it as restructuring  if the revised DCCO falls within the period  of one year from the original  DcCo stipulated  at the time of financiat closure  for CRE project and all other terms and conditions  of the loan remain unchanged.

(vii) Resolution Framework  for COVID-l9 related stress - RBI has also provided a window under the "Prudential Framework  on Resolution  of Stressed Assets dated iune 7, 2019" to enable lenders  to implement  a resolution  plgn  in respect of eligible .orforut" exposures  exceeding  Rs. 25 crore, which were not more than 30 days past due al on 0f.0g.2020 and where the stress is on account of Covid-l9 pandemic,  to be invoked not later than gf"  Dece;;;r, 2O2O and implemented  within 180 days thereafter.

(viii) other reliefs/incentives  have been provided  for the Real Estate Sector such as infusion of Rs' 75,000 crore- for NBFCs, HFCs and Micro Finance Institutions,  extension of Credit Link Subsidy Scheme (CLSS)  under Pradhan  Mantri Awas  yojana -  Urban (pMAy-u)  tilr sriiM.;;h;

202L' Affordable Rental Housinq complexes  (ARHCs)  scheme for migrant labours and urban poor' All these measures  takei by G'overnr"nt wili certainiy  ioarels the issue of liquidity disruptions  and augment the frow of finance  to the rear estate sector.

(c)  In order to provide impetus to ARHCs scheme, a combination  of incentives/benefits  to be provided  by Government of India and state/ur Governments  have been proposed  as mentioned below:

- ' concessional  Project Finance under Affordable  Housing Fund (AHF) and  priority Sector Lending (pSL).
- ' ExerTlption in Income Tax $  GST on any profit and gains  from ARHCs.
- . 50o/o additional  FAR/FSI, free of cost.
- . Use Permission changes, if needed.
- ' single window approva! of ARHC projects,  within 30 days.
- ' Municipal charges  at par with residentiar  property.
- . Trunk infrastructure  upto the project  site.

Additional  fund in the form of Technological  Innovation Grant (TIG) is provisioned  for projects using Innovative, s-ustainable, green  ana disaster-resilient  technologies  as *"lr ., building materials  for cost effective,  fastei and quarity  construction of ARHCs.

(d) & (e) Scheme for Affordable  R"l!g! Houging comptexes (ARHCs),  a sub-scheme  under Pradhan  Mantri lyut  Yojana-Urba.n  (PMAY-U),  f,u, been launthed  on 3L.07.2020  with the objective of providing  accbmmodation-at  affordable  rent to urban migrants/  poor belonging to Economically  weaker Section (EWS)/  Low Income Group (LIG).  irr"y may include labour, urban poor (street vendors, rickshaw puliers,  other service providers  etc.), industrial  workers, and migrants  working  with market  /  trade associations,  educational  /  health institutions,  hospitality sector, long term tourists  /  visitors, students o. uny other p.rroni oi such category.

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