In the past nine years, the ministry of housing and urban affairs (MoHUA) has completed 8.5 million houses under the Pradhan Mantri Awas Yojana-Urban (PMAY-U), the minister of state at MoHUA Tokhan Sahu told the Rajya Sabha today. The minister also informed that out of the Rs 2 trillion financial assistance sanctioned by the centre under the PMAY-U scheme, Rs 1.64 trillion has already been disbursed.
“PMAY-U is a demand driven scheme and the government has not fixed any target for construction of houses. Based on the demand for housing in the urban areas, States and union territories prepare project proposals and after approval of state-level sanctioning & monitoring committee, these are submitted to this ministry for sanctioning of admissible central assistance,” the minister said.
Despite the significant progress made under the PMAY-U, experts said that there’s still an acute shortage of urban housing. In a recent report, Knight Frank and CII said that rapid urbanisation has exacerbated India’s housing deficit, particularly affecting affordable housing options for lower-income groups.
“While initiatives like the PMAY have been implemented to cater to this segment, a more comprehensive policy approach is warranted. The urban housing shortfall stems from a complex interplay of demand and supply side issues,” the report said while estimating that the additional requirement of 78 million urban housing units by 2034.
In the FY25 budget, the finance minister announced that the government will give central assistance of Rs 2.2 trillion for 10 million additional houses under PMAY-U over the next five years. This translates into 2 million houses per year, which is significantly short of the required housing needs in urban areas. Already, the exorbitant land prices has made it economically unfeasible for developers to embark on affordable housing ventures.
“Even if the government builds those houses, it is likely to be inadequate as housing for all. The housing issue is infrastructural. We have finally acknowledged that if industry has to flourish, rental housing needs to be provided for industrial workers. Housing must be planned along with access to work and mobility,” said Jagan Shah, CEO, Infravision Foundation.
The PMAY-U programme has four verticals, including beneficiary-led individual house construction (BLC), affordable housing in partnership (AHP), “In-Situ” slum redevelopment (ISSR) and credit-linked subsidy scheme (CLSS). Under AHP and BLC segments, the central assistance is fixed at Rs 0.15 million and in the case of ISSR, the assistance is Rs 0.1 million. For the CLSS vertical, there’s an interest subsidy of up to Rs 0.27 million per house for low-income, middle-income and economically-weaker sections.