HDFC Capital, the wholly-owned subsidiary of India's largest mortgage lender, HDFC, plans to spend roughly $2 billion on affordable housing through its third fund focused on this area. HDFC Capital Affordable Real Estate Fund-3 (H-CARE-3) is one of the world's largest funds for residential real estate investment. Investors have already committed approximately $1.22 billion to the fund's initial closing. The fund's principal investor is an Abu Dhabi Investment Authority wholly-owned company (ADIA). The H-CARE-3 fund's overall corpus, including future reinvestments, will be roughly $2 billion. "With the increased demand for affordable and mid-income housing in India, housing will play an even more important role as a catalyst for growth." When I consider India's growth prospects, I have never been more optimistic about the housing sector than I am today," said Deepak Parekh, Chairman of HDFC. According to him, while demand for affordable and mid-income housing remains strong, one of the major challenges confronting developers of affordable and mid-income housing in India is a lack of flexible, long-term capital. Over the last six years, HDFC Capital's funds have supported the development of over 78 residential projects and 180,000 houses across India, with a focus on providing developers with flexible financing.