Union Cabinet, Central government has decided to create National Urban Housing Fund of Rs. 60,000 crore under Pradhan Mantri Awas Yojana (Urban). Subsequently, govt. will utilize this financial assistance for “Housing for All” Programme – PMAY to build 1.2 crore affordable houses under Urban Housing Scheme by FY 2022.
Govt. will place these funds under the Building Materials and Technology Promotion Council (BMTCP). Subsequently, BMTCP is an autonomous body under the Ministry of Housing and Urban Affairs (MoHUA). Accordingly, the primary objective is to mainstream several new construction technologies.
Central govt. will raise funds from non-budgetary source and tap them into existing govt. entities like Housing and Urban Development Corp. (HUDCO).
Urban Housing Scheme – Extra Funds Under PMAY
Central govt. has proposed the creation of such funds in Union Budget 2018-19. Accordingly, govt. has to construct 37 lakh (3.7 million) houses in urban areas and 51 lakh (5.1 million) houses in rural areas. These houses are approved by the central govt. under PMAY (Urban) till Jan 2018.
To finance the housing projects under govt’s flagship scheme – Pradhan Mantri Awas Yojana (PMAY), govt. will provide Rs. 25000 as extra budgetary support in FY 2018. Moreover, PMAY Urban targets around 4,300 cities and towns.
Union govt. has allocated Rs. 6,505 crore for urban housing scheme in its budget which was insufficient for construction of proposed number of houses. As per the reports, Urban Affairs Ministry sanctions 2-3 lakh houses per month on the basis of proposals from states and UTs.
These new funds will increase the necessary funds as per the requirement for next 4 years and will also compensate any budgetary shortfalls. Central govt. will release a total amount of Rs. 1.7 lakh crore. Moreover out of the total 1.2 crore (12 million) houses, govt. has already completed 5 lakh houses and other 17 lakh houses have been approved.
Govt. is also offering interest subsidy for housing loans under Pradhan Mantri Home Loan Schemes. Accordingly, govt. has already sanctioned 87000 applications and is currently processing approx. 40,000 applications.
Under the Urban Housing Scheme, govt. provides Rs. 1.5 lakh financial assistance for construction of new house. Moreover for In-Situ development of houses replacing slums, every beneficiaries gets Rs. 1 lakh. Furthermore, Central govt. also launched another sub-component to target Middle income groups in which govt. provides Rs. 2.5 lakh – Rs. 2.7 lakh as Interest Subsidy.