Govt may extend priority sector lending benefit to all housing loans

By PTI
22 January, 2015

In order to boost real estate development, government is planning to extend priority sector lending benefits to the housing sector and work on bringing down the interest rates to 7-8 per cent.

“We are for the entire housing sector to come under priority sector lending and working towards it. I have met the Prime Minister on this and the PM is going to have a meeting of banking and housing secretaries to discuss the proposal,” Urban Development and Housing & Poverty Alleviation Minister M Venkaiah Naidu today said here while releasing a report on the Smart City project organised by PHDCCI.

NDA government is currently working on a mission to create 100 Smart Cities across the country which will be equipped with 24-hour water and power supply, quality education, clean air, efficient urban transport system among other services.

Naidu said the interest rates should also be brought down to 7-8 per cent to boost the housing sector. At present, the interest rates are generally in double digits.

Naidu will be holding a two-day meeting beginning from January 30 with all state governments to firm up the final concept of Smart Cities.

“I am calling all states to finalise the Smart City concept. It is broadly ready and we have discussed with various stakeholders. There are also discussions with foreign countries interested in the project. We held deliberations at various levels.

“The views of industry have also been taken into account. Now we will have a final view with states and then we will take it forward. There will be a meeting with state secretaries on January 30-31,” Naidu said.

Naidu stressed that housing is an essential part of Smart City project. 

“Smart City will be through PPP model. It requires huge amount of money– Rs 40 lakh crore initially and then Rs 20 lakh crores for its maintenance and then you require another Rs 1.6 lakh crore for housing as it is essential part of smart city. Affordable housing is priority of our PM. We have also allowed FDI in the sector,” Naidu said.

On the ordinance issue which has brought flak to the Modi government, Naidu said the government has “no fancy” for bringing Ordinances and asked the Opposition to come forward for “meaningful discussion” in the coming Budget session in Parliament.

“I hope that the Opposition will understand the necessity of bringing Ordinances. Government has no fancy for Ordinances. I can assure the country and the Opposition that we will not resort to Ordinance if you allow the Parliament to function…have a meaningful discussion.”

About President Pranab Mukherjee’s comments on the ordinances, Naidu said, “We fully agree with the advise given by the President. We have got a clear mandate after 30 years.

Investment will come only through removing hurdles and clearing bottlenecks. Let there be debate, discussion and then decision.” 


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Govt may extend priority sector lending benefit to all housing loans

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