Is PMAY A 'Roaring Success'? Data Suggest Otherwise

Is PMAY A 'Roaring Success'? Data Suggest Otherwise

Is PMAY A 'Roaring Success'? Data Suggest Otherwise

It was in June 2015 when Prime Minister Narendra Modi launched the rural and urban version of Indira Aawas Yojna and renamed it as Pradhan Mantri Awas Yojna (PMAY) for providing affordable housing options to rural and urban poor. The mission remained the talk of the town for a long time in the real estate sector as the target for building 2 crore homes seemed impossible without private sector participation.

While states were accorded with the responsibility to promote affordable housing for poor and provide shelter to each citizen by 2022, the ground reality remained very different due to various reasons. Shortage of land, funds, infrastructure were quoted as the deterrents by most of the states leaving PMAY scheme in dwindling position. However, the ministry is still seeking a defending stand for the scheme attributing its success to budgetary allocation.

Defending position

Housing Minister, Hardeep Singh Puri has said in the Lok Sabha that the Pradhan Mantri Awas Yojana is a "roaring success" and the government's aim of housing for all by 2022 will be achieved, rejecting another member's claim of the scheme being a failure. He cited budgetary allocation and financial outlay for building houses for the poor to assert that the scheme was a success.

The budget allocation for PMAY Urban has been increased to Rs 6500 crore from Rs 6,043 crore during 2017-19. Around Rs 33,000 crore has been allocated for PMAY-Rural. Apart from this, the creation of Affordable Housing Fund under National Housing Bank is another stance that Puri quoted while defending his stand.  However, the gross budgetary support to the Ministry of Housing has been reduced by the Centre, allocating Rs 21,424 in Union Budget 2018-19 as against Rs 23, 853 crore during 2017-18.

He further added, based on feedback from states, the figure for the shortfall of houses in the urban area has been revised down to 11 million by his ministry from earlier 18 million, he said, adding that over 37.45 lakh houses have been sanctioned. These dwelling units were part of 7,474 projects with an investment of Rs 2 lakh crore involving central assistance of Rs 57,000 crore have been accepted under PMAY in the last 31 months. Of this, 19.49 lakh houses have been grounded and around 3 lakh houses have already been completed. A total of 2,78,267 houses have been occupied.

Further, Puri also mentioned that in an effort to boost women empowerment, the title of houses built under the scheme will be in the name of a woman in the family.

Not a rosy picture

The rosy picture painted by the housing ministry is not that endearing. The data speaks otherwise as against 3.3 lakh houses being sanctioned, the marginal increase in budgetary allocation do little good for states as the project sanctioning process is slow. With little incentives for real estate builders, only few players have come out with their affordable housing projects despite huge consumer demand and allocated infrastructure status to the sector that facilitates easy funding.  

To woo the private players and chase the appalling target in urban areas, Centre recently amended the guidelines for PMAY. Areas falling within notified planning or development area under the jurisdiction of an industrial development authority or special area development authority or urban development authority or any such body under state legislation which is entrusted with the functions of urban planning and regulations shall also be included for coverage under PMAY, according to the amended guidelines.

In order to boost demand further, Centre has also cut down the GST on affordable housing to 8 per cent but its impact is yet to get visible as the main constraint lies in supply side rather than demand side.

In Karnataka only 38,000 are being built. In addition to this, the central government's share in the urban housing was meant to be Rs 4,357 crore, of which it released only Rs 345 crore, not even 10 percent.

Similarly, in the state of Haryana, the construction work for the affordable is moving at a snail’s pace in Haryana. While the Centre has been informed about the demand of about 2 lakh houses in 80 towns in the state, with an expected investment of Rs 1,743 crore, out of which Rs 375 crore has to be paid by the Centre, there are only 85 projects which have been sanctioned by the state and only 720 houses have been completed. Further, the state has submitted not a single proposal under the In-situ Slum Rehabilitation component despite a huge potential in view of around 3 lakh slum households.

While few states such as Gujarat, Karnataka, Tamil Nadu, Madhya Pradesh, Jharkhand and West Bengal are leading the numbers with maximum contribution in housing for all mission, creating at least 20,000 houses each, states such as Bihar, Chhattisgarh, Haryana, Kerala, Orissa, Punjab, Telangana and Uttarakhand have constructed between 1,000 and 5,000 houses. Other states and union territories that had constructed less than 100 houses include Arunanchal Pradesh, Chandigarh, Daman and Diu, Goa, Meghalaya and Puducherry. Sikkim had just one house constructed under the scheme so far. 

With inputs from Housing News

Last Updated: Thu Mar 01 2018

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