The Indian government has made an allocation of $6.43 billion in the national budget 2022-23 for the construction of 8 million affordable housing units in rural and urban areas, according to the government’s budget document on Thursday, February 3.
The move to allocate higher funding for affordable housing will boost the construction sector and the overall economy by spurring demand for raw materials like steel and cement, a government official said.
This will also catalyze the affordable housing construction business to evolve as a major sub-segment of the real estate development sector, the official said.
Reacting to the fund allocation and expected demand for steel products, traded prices of rebar in the local market surged INR 500-1,000/mt ($7-14/mt) across regional markets, leading to a further consolidation of long products at higher levels, a Mumbai-based steel distributor said.