By Rohit Poddar, MD- Poddar Housing and Development Ltd
The Government of India announced “Pradhan Mantri Awas Yojna (PMAY)” in June 2015 with the aim to ensure that no one remains oblivious to privilege of having a home of their own by the year 2022. That was the first time in history that any government in the centre has made housing such an important issue. It has two constituents: Pradhan Mantri Awas Yojana (Urban) (PMAY-U) for the urban poor and Pradhan Mantri Awaas Yojana (Gramin) (PMAY-G and also PMAY-R) for the rural poor. This scheme was launched with the target of building 20 million affordable houses by 31 st March 2022 for the people coming under the economically weaker section and lower income groups in urban areas with the assistance of Rs 2 trillion (US$28 billion) from central government.
The PMAY scheme promises that the government will provide an interest subsidy of 6.5% on housing loans availed by the inheritor for a period of 20 years under credit link subsidy scheme from the start of a loan.
Target of the mission:
As of July 2018, the government has included4,320 cities and towns across the country in the PMAY scheme to begin construction of houses and 11,226 projects have been approved for urban LIG (Lower income group) and EWS (Economically weaker section). The government approved the construction of 1,86,777 additional houses for the benefit of urban poor with an investment of Rs.11,169 cr with central assistance of Rs. 2,797 cr was approved in February 2018, including subsumed Rajiv Awas Yojna scheme, of the targeted 20 million houses by March 2022.
Progress so far:
The data released by the Ministry of Housing and Urban Affairs shows that till the month of November, 62,91,256 houses were sanctioned under the scheme’s urban component, of which 11,55,807 have been built which is almost 18% of the number of sanctioned houses in last three years. The completion percentage was 15 in the month of July. The government has aided states with over Rs 78,000 crore to build urban homes and work for more than 30 lakh units is underway. The total investment done by the government in projects under this scheme is around 3.40L crore. The total sanctioned amount for central assistance was 96,125 crore and 32,300 crores have been released in the central assistance. Data shows that the scheme is in progress but it still has a long way to go. The rate at which houses have been built so far may not be enough to meet the housing needs of the country by 2022.
Hurdles across the way of mission:
Though the incentives from the government have made the developers enthusiastic about the PMAY scheme, there are still many hurdles across the way of implementation which is hindering the pace of the development in urban areas. One of the major problems in implementation is the time it takes to get a project approved by the authorities. It takes almost 4 to 6 months for the whole paperwork and to get the projects approved.
Another big problem for such a project is the availability of the location. There is no space to build affordable housing projects in the bigger metro cities. Such projects can only be built in suburbs or the outskirts of the city and a big workforce resides in urban areas of the city. This puts a big question mark in front of the people whether they should move to a remote location from their workplace.
Access to easy housing loans for LIG (Lower income group) is essential if we are to meet the housing needs of the country by 2022. To have access to home loans one needs to produce the documents required which is preventing urban poor to avail the benefits of the scheme and get the loan. This is hampering the redevelopment plans of the government in urban areas.
Push by the government:
In alignment to our Prime Minister Narendra Modi’s vision, there are more affordable houses to be built to accomplish the mission. The government of India has come up with many positive measures to push the PMAY. In the month of august, the ministry of housing approved construction of nearly 1.12 lakh more affordable houses for urban poor, taking the total number of a number of houses being funded under the PMAY(Urban) to 54,95,443. Total guesstimate of investment by the government under this scheme is around 2.97L crore and the funding of Rs. 82,040 crore have already been approved by the central government until the month of August in2018. State governments are also giving green signal to policies which will help in accomplishing the mission. Recently the government of Maharashtra led by Devendra Fadnavis has shown green signal to developers to use the grazing land for the construction of the affordable housing projects to give a bit of pace to the development of affordable housing projects. The government implemented many regulations to bring the prices of property down and make it affordable for LIG and EWS.
With the advent of RERA, it is paramount to complete projects on schedule, on cost and with the first time right quality. Hence automation as much as possible is the way to go, using aluminium foam work, tunnel foaming or other such technologies which enable fast repetitive construction.