State-owned Housing and Urban Development Corporation (Hudco) is banking on next-generation technology as it aims to triple its loan book to ₹3 lakh crore by 2030. The public sector company is adopting digital tools and advanced analytics to address the growing demand for infrastructure financing while aligning with priorities, including affordable housing and large-scale infrastructure projects.
“We have transitioned to a paperless environment and implemented ERP systems, providing a solid foundation for adopting advanced technologies like Artificial Intelligence (AI) and Machine Learning (ML),” said Hudco Chairman and Managing Director Sanjay Kulshrestha in an interview with TechObserver. Kulshrestha added that these technologies are being explored for critical operations such as compliance management, cost of borrowing, and project appraisals.
One of the proposed innovations is a real-time project appraisal system powered by AI. “Projects could be simultaneously evaluated by stakeholders using AI tools before being presented to the board for final approval. This would streamline workflows and improve efficiency,” he said.
Hudco’s focus on technology is part of a broader strategy to modernise its operations and address evolving financial challenges. By leveraging AI and ML, the company aims to better manage risks, ensure compliance, and optimise resources for impactful infrastructure development.
The adoption of technology comes as Hudco positions itself as a key player in India’s infrastructure financing landscape. Over the last year, Hudco has nearly doubled its disbursements and increased sanctions to ₹82,000 crore. Kulshrestha emphasised the alignment of this growth with the government’s broader goals for infrastructure development and housing for all.
As part of its modernisation drive, Hudco has also strengthened its digital infrastructure to handle the regulatory requirements that came with its reclassification as a non-banking financial company (NBFC) with Infrastructure Finance Company (IFC) status. The shift involved extensive engagement with the Reserve Bank of India (RBI) and compliance upgrades to meet stringent regulatory standards.
Technology and Financial Innovation
Hudco is also exploring innovative financial models to support its growth and align with India’s infrastructure needs. These include asset monetisation strategies, Hybrid Annuity Models (HAM), and Public-Private Partnerships (PPP). According to Kulshrestha, such models allow for better financial structuring and faster project execution while minimising risks.
In addition, Hudco has tapped international markets to secure funding at competitive rates. Recently, it raised $448 million from the Japanese market, benefiting from interest rates significantly lower than domestic borrowing costs. “This achievement reflects the confidence international investors have in Hudco and India’s economic trajectory,” Kulshrestha said.
Hudco’s focus on technology and innovation is closely tied to its role in implementing government initiatives. The company is a major partner in programs like Pradhan Mantri Awas Yojana (PMAY) 2.0, which aims to provide housing for all by 2025. To meet these objectives, Hudco is tailoring its financing models to address state-specific infrastructure priorities, ranging from housing and roads to water supply and metro projects.
“Our regional offices work closely with state governments to understand their development needs and create customised action plans,” Kulshrestha explained. By leveraging technology and aligning resources with state-specific goals, Hudco aims to maximise its impact.
Building Capacity for the Future
As Hudco prepares for its next phase of growth, the organisation is focusing on capacity building and workforce expansion. It is onboarding 766 new officers with expertise in areas such as technology and private sector financing. This move comes as Hudco explores re-entering private sector financing, which it had paused in 2013. “We are building systems and capabilities to ensure that when we do engage with private projects, we are fully prepared to manage them efficiently,” Kulshrestha noted.
