Builders' lobby group Confederation of Real Estate Developers' Associations of India (Credai) has demanded an extension of the loan moratorium with interest waiver. They have also sought a sweetened loan-restructuring deal, arguing that 95% of the developers would default as the terms of the debt recast to tackle the pandemic impact on the sector were not “meaningful”.
The statement comes just ahead of the Supreme Court hearing on the issue of interest waiver during the moratorium period, a suggestion that has not found favour with either the government or the RBI. Credai-Maharashtra has filed a petition urging the apex court to direct the government to consider their demand of loan restructuring and interest waiver for the moratorium period. It has demanded the loan moratorium be extended up to March 2021.
Credai termed the present announced norms for loan restructuring as “illusory” and said that it would benefit at the most 5% developers. A large number of realtors, including some marquee names, were defaulters even before the pandemic and are ineligible for the special loan-restructuring scheme announced by the RBI to tackle the distress. Only entities that did not have loan overdues of over 30 days are eligible for the one-time benefit under the scheme.
With demand picking up and cash flow resuming, a fresh moratorium will help the real estate sector, Rustomjee Group CMD and Credai vice-president Boman Irani said.