Budget 2019: Will PM Modi buck the trend and allot more funds to the scheme that helped him win Lok Sabha polls

Union Budget 2019-20: Prime Minister Modi’s flagship scheme housing-for-all has seen budget cuts during the last two years. Will he reverse the trend this time?

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Here are some of the initiatives that could be considered by the new Finance Minister for the the real estate sector in Budget 2019.

India Budget 2019: Prime Minister Narendra Modi’s flagship housing scheme that helped him win the election with a thumping majority had seen budget cuts in last two years. Despite the budget cuts in recent times, this scheme, along with other flagship schemes like Ujjwala scheme, was highly popular and played a crucial role in Prime Minister Narendra Modi’s resounding victory in the recently concluded Lok Sabha elections.

In June 2015, Prime Minister Narendra Modi had launched his ambitious housing scheme for all – Pradhan Mantri Awas Yojana (PMAY) – with the aim to construct more than 2 crore houses by 2022 to provide housing to all.

Unlike, his predecessor, Prime Minister Modi allocated significantly higher budget to construct crores of houses in rural and urban areas. He also joined his other flagship schemes like Ujjwala Yojana, Swachch Bharat Mission, and Saubhagya Yojana with PMAY to also provide electricity connection, water, toilet and domestic gas connection in the house as a complete package for poor people.

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While presenting the interim budget in February this year, former finance minister Piyush Goyal informed the Lok Sabha that more than 1.53 crore houses have been built under the Pradhan Mantri Awas Yojana.

This scheme, along with Ujjwala scheme to provide free gas connection and PM Kisan Samman Nidhi that was launched just ahead of election, was crucial in creating a massive pro-incumbency in favour of Modi government.

Under the scheme, in urban areas, the government offers a credit linked subsidy at the rate of 6.5% for a tenure of 15 years on interest payments on home loans . The government also gives an assistance of Rs 1.5 lakh for construction of houses in EWS category.

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Realising the importance of PM Kisan Samman Nidhi scheme in his massive election victory, immediately after winning the second term Prime Minister Narendra Modi scaled up the PM Kisan Samman Nidhi to cover all the farmers in the country, irrespective of the size of land holding.

Now all eyes are on the future of Pradhan Mantri Awas Yojana. Experts believe that Prime Minister Narendra Modi will reverse the trend this year and may allocate more funds to the scheme.

According to information given in interim budget this year, Modi government had spent Rs 31,163 crore on PMAY in FY 2017-18. However, the next year, Union government cut the funding of PMAY by 12% to Rs 27,505 crore, a reduction of Rs 3658 crore .

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According to the revised estimates for 2018-19, the total expenditure on the scheme was less than the budget allocation as overall spending was Rs 26,405 crore, a decline of Rs 1100 crore from the budget estimates.

In comparison with the actual spending on PMAY in 2017-18, the revised estimates for PMAY for FY 2018-19 reveal that the spending on scheme declined by over 15% or Rs 4,758 crore between FY 2017-18 and 2018-19.

Despite praising the scheme in his maiden budget speech, then finance minister Piyush Goyal had allocated even lower funds for the scheme. In the interim budget for 2019-20, Piyush Goyal allocated Rs 25,853 crore on Pradhan Mantri Awas Yojana, a reduction of Rs 552 crore in comparison with the revised estimates of Rs 26,405 crore for FY 2018-19.

READ ALSO: Union Budget 2019-20: Modi government to present maiden budget of its second term on July 5

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