India builders face roadblock as banks tighten lending tap

Mumbai

INDIAN builders struggling to sell homes amid mounting debt face a new hurdle: reluctant bankers.

"There's a lot of demand from builders and commercial real estate developers for loans," Ranjan Dhawan, Bank of Baroda's Mumbai-based chief executive officer, said in a May 11 interview. "There's a limit to how many builders we can finance. The current economic scenario has made us very cautious."

Expansion in lending for commercial real estate slowed to 8.9 per cent in the 12 months through March 20, from 22.4 per cent a year earlier, central bank data show. Home sales in India's top six property markets fell 8 per cent last quarter from a year earlier, according to research firm Li…