Limited Period Offer:Be a PRO for 1 month @Rs49/-Multiple payment options available. Know More

UP govt permits Noida, Greater Noida and Yamuna Expressway authorities to slash interest rates on land dues

Developers say the move will help them deliver pending projects faster

Providing relief to real estate developers, the Uttar Pradesh government on June 9 permitted Noida, Greater Noida Industrial Development Authority and Yamuna Expressway Industrial Development Area Authorities to slash interest rates on land dues pending from builders.

It allowed authorities to charge interest on the balance outstanding at Marginal Cost of Funds based Lending Rate (MCLR) plus 1 percent. This is expected to help builders deliver pending projects faster, realtors told Moneycontrol.

“This comes in as a major relief. The high interest amount, which is to be paid to authorities by developers, can now be utilised to complete projects,” RK Arora, President of NAREDCO UP Chapter, said.

Realtors had been demanding that interest be charged at State Bank of India's (SBI) MCLR rate and an additional 1 percent.

Manoj Gaur, MD, Gaurs Group and Chairman, Affordable Housing Committee, CREDAI National, welcomed the move. “It is much needed and will reduce the burden on developers, the ultimate beneficiary will be homebuyers.”


COVID-19 Vaccine

Frequently Asked Questions

View more
How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

View more

Interest on land premium is usually charged at the rate of 12 percent plus 3 percent, which works out to be between 22 percent and 24 percent if compounded annually.

To tide over the COVID-19 crisis and the subsequent dip in sales, developers in Uttar Pradesh had asked Satish Mahana, Cabinet minister, Department of Infrastructure and Industrial Development, Government of Uttar Pradesh, and Alok Tandon, Infrastructure and Industrial Development Commissioner, Government of Uttar Pradesh, to reduce circle rates, waive stamp duties and also called for reduction in interest rates.

“The interest rate should be equal to MCLR plus 1 percent,” Arora had told Mahana on April 29 during a webinar organised by NAREDCO.

Moneycontrol News
first published: Jun 9, 2020 10:06 pm

stay updated

Get Daily News on your Browser