Affordable housing to get boost2 min read . Updated: 23 Jul 2013, 12:21 AM IST
Govt to allocate `35,000 crore to implement three programmes related to residences for low-income families
New Delhi: Affordable homes are set to get a boost as the housing and urban poverty alleviation ministry will soon be getting ₹ 35,000 crore to implement three programmes related to residences for low-income families.
These are the Rajiv Awas Yojana, a scheme for rehabilitation of slum dwellers; the Rajiv Rinn Yojana for providing interest subsidies on housing loans; and the Affordable Housing in Partnership scheme to attract private housing companies.
The funding will be over four years.
“All three have been cleared by EFC (expenditure finance committee) and we expect to get a cabinet clearance for the all three by 15 or 20 August," said Arun Kumar Misra, secretary, housing and urban poverty alleviation ministry. He was speaking at a symposium on affordable housing.
There is a shortage of 18.78 million housing units in the country, 96% of which is in the economically weaker section (EWS) and lower income group (LIG) category. The three schemes are targeted at these groups.
Girija Vyas, housing and urban poverty alleviation minister, said that her department had modified the schemes from their pilots to improve them.
While the Rajiv Awas Yojana used to cover all the slums in a particular city at once, it will now concentrate on one slum at a time.
“It was taking a lot of time to do the survey for the whole city so we’ll do one slum at a time which will bring down the paperwork substantially," Misra said.
A “task force on promoting affordable housing" set up by the ministry has recommended that incentives for affordable housing sector should include concessions to development-related charges and service tax exemptions, Misra said.
Other incentives recommended include direct tax rebates for affordable housing and labelling it an “infrastructure" sector, making it eligible for tax concessions.
The report recommended that the government should provide direct capital grant support for affordable housing projects through viability gap funding.
In order to attract foreign direct investment (FDI), “the minimum investment should be brought down from $5 million to $2 million", the report said. Non-financial incentives include fast-track approval for affordable housing projects. Financial incentives include interest subsidies for the urban poor and an appropriate reduction in stamp duty, among others.
The ministry will move a cabinet note on Tuesday for another scheme that will boost the employment potential of the urban poor. The National Urban Livelihoods Mission is set to get budgetary support of ₹ 7,000 for a period of four years.
“Fifty percent of the money will be used for employment of skilled labour and the rest of it for providing employment to the homeless, training programmes, benefit of street vendors and providing bank linkages for self employment," said an official who didn’t want to be named.