Wednesday 26 June 2013

India: can foreign loans lift housebuilding? | beyondbrics

"The Indian authorities, as part of its effort to ease a chronic shortage of affordable housing, this week boosted a scheme that allows developers and housing finance companies to use overseas commercial loans to fund low-cost homes.

The central bank changed its regulations to make it easier for borrowers to qualify for such lending. But does external finance policy actually work?

The RBI has made amendments that reduce the minimum experience developers require in residential work from five to three years. And it is eliminating a requirement that housing finance companies have minimum paid-up capital over Rs500m ($8.39m) to use the external loans. And the $1bn overall ceiling on borrowing under the scheme has been extended until April 2015."

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