The Maharashtra government’s town planning and infrastructure development authority, the City and Industrial Development Corporation (CIDCO), has secured a fund-based Line of Credit (LOC) worth Rs 5,000 crore from the State Bank of India (SBI) for the Pradhan Mantri Awas Yojana (PMAY) mass housing project in Navi Mumbai.
This financing is expected to help in speeding up the ongoing project with more than 1.12 lakh houses. The rate of interest for this financing is 6%, which is the lowest for any public sector undertaking for a line of credit of this size. This funding has helped in financial closure of this mega housing scheme that has a total project cost of Rs 30,000 crore.
The entire project will be financed with Rs 4,000 crore infusion by CIDCO, Rs 5,000 crore through SBI’s Line of Credit and the remaining will be internal accruals of the project.
“The line of credit sanctioned by the State Bank of India will enable completion of the Mega Housing Scheme on time. Interest rate of 6% is probably the lowest rate for any PSU historically. This mega housing scheme is amongst the largest of this kind in India and globally. This line of Credit helps the project achieve the financial closure,” said Sanjay Mukherjee, vice chairman and managing director, CIDCO.
The town planning body is implementing this housing scheme based on the concept of ‘Transit Oriented Development’ (TOD) in various nodes of Navi Mumbai and the entire project will be developed in three phases. The first phase has 23,500 units, second phase will have 67,000 units and the third phase will have additional 22,000 units.
Around 35% of these houses are reserved for the economically weaker section (EWS) of the society, 15% for the lower income group (LIG), and the remaining houses will be for open market sale.
CIDCO has appointed a private agency for Marketing and Consumer Relationship Management of the scheme to ensure end to end services throughout and after sale process. Thus, CIDCO has become the first government authority to adopt this kind of professional approach for the housing scheme.
The town planning body has already worked on various fronts like site availability, financial planning, statutory clearances, project monitoring mechanism and started implementing the scheme. The first phase of the scheme has been completed and the work under the second phase is underway, while the work on the third phase will start soon.
Though CIDCO works on a self-sustainable financial development model to implement high-cost infrastructure development projects, the fund-based line of credit from SBI will take care of any unforeseen circumstances and ensure that nothing affects the speedy completion of the project.
The mega housing project is spread over 11 strategic locations in both Navi Mumbai and Panvel municipal areas. These housing complexes have good connectivity through the existing Harbour, Trans-Harbour Railway and the upcoming Nerul-Uran railway lines and state highways. This will significantly save travel time of residents of these housing complexes for travelling to the various business districts in the Mumbai Metropolitan Region
The projects are also close to various employment centers such as the upcoming Navi Mumbai International Airport, the International Corporate Park, Taloja MIDC, the JNPT and JNPT expansions.
