India mulls loan sops for MSMEs Indian banks’ fundraising plans put off Credai red flags slump in sale of properties
New Delhi, March 18: India is considering offering easier loan repayment terms and tax breaks for smalland medium-sized companies to help Asia’s thirdlargest economy weather the onslaught of the coronavirus, a person with knowledge of the matter said.
The finance ministry is considering extending loan tenors and relaxing baddebt norms for small firms, the person said, asking not to be identified as the discussions were private.
A spokesman at the ministry of finance was not immediately available for a comment.
Prime Minister Narendra Modi’s administration is under pressure to shield the economy from the impact of the virus outbreak at a time when expansion is already poised for its weakest pace in more than a decade. Countries, including the US, China and Indonesia, have announced plans to spend billions of dollars to stem a slide in growth. — Bloomberg
Mumbai, March 18: Two state-owned Indian banks that were aiming to raise funds to meet growth targets and build up capital for regulatory requirements have shelved their plans due to the disruption to markets caused by the coronavirus pandemic, sources said.
Bank of India was planning to raise around `2,000 crore via a qualified institutional placement (QIP), a common capital-raising tool in India, by the end of March.
“These are not normal times and it makes sense to launch it when the right time comes,” said a senior banking source with direct knowledge of the matter.
Central Bank of India was aiming to raise `5,000 crore this quarter by issuing so-called Basel-III compliant bonds. “A board meeting will be held next week and we will announce the decision then but it makes no sense to enter such a disruptive market,” said a senior bank executive, which refused to be named.
New Delhi, March 18: Realtors’ apex body Credai on Wednesday said the construction work has come to a standstill while sales have been hit following the outbreak of coronavirus, and demanded the government to provide a threemonth moratorium on debt repayment, additional liquidity and more time to complete ongoing real estate projects.
The industry body has written a letter to Minister for Housing and Urban Affairs Hardeep Singh Puri seeking a bail out package.
Giving details about the impact of coronavirus scare on Indian real estate, Credai said sales velocity and the receivables have been hit drastically leading to default/delay in fulfilling financial commitments (interest & principal).
Property buyers are skipping instalments payable on their purchases of real estate, it said, adding that rental income of retail properties has been affected due to closure of malls and multiplexes.
“The construction work has come to a standstill and delays in procurement or delivery of construction material (imported and indigenous) as well as the labour disruptions are bound to cause delay in completion of ongoing projects,” Credai said.
The association said that the governments world over have stepped in to provide immediate relief to businesses and industry to enable them to deal with the severity of the Covid-19 shock and urged Indian government to announce measures to help real estate developers.
Credai recommended various steps that need to be taken immediately for cushioning the shock of Covid-19 to the Indian real estate sector.
The association said the government should provide relief in interest and principal repayments falling due over the next three months in case of real estate projects. It also requested that penal interest charged by banks should be suspended for a period of one year.