Coimbatore, Jan 4 (KNN) The pump manufacturers, especially from the Micro, Small and Medium Enterprises (MSME) sector, are optimistic that PM’s announcement to give additional subsidy on rate of interest for home loans will trigger demand for pumps.

On December 31, PM Modi had announced additional subsidy on the rate of interest for home loans.

He said that the government will facilitate 4% and 3% interest rate rebate for housing loans up to Rs 9 lakh and Rs 12 lakh, respectively.

Additionally, loans of up to Rs 2 lakh for new housing or extension of housing in rural areas will receive an interest subvention of 3%.

“Now it can be seen that those who are planning to have a new house can get it. While earlier they would have had to pay a higher rate of interest (depending on loan from bank or NBFC). That will change with the government's new scheme of 3% subsidy on his loan amount,” said an industry expert.

Increase in the demand of new home will further increase the demand of necessary daily used equipment; one of such thing is pump.

According to the Southern India Engineering Manufacturers' Association (SIEMA), the announcement regarding extension of loans up to Rs 12 lakh with a 3 per cent rebate in interest for construction of new houses to the poor living in urban areas, “will trigger the demand for domestic pumps.”

Increasing the loan limit from rupees 1 crore to 2 crore to traders or industries without collateral will help the micro and small industries develop their units, the SIEMA President said, hailing the announcement.