Housing Deficit: of 18.78 million units and 95% of it is required for EWS population which live in and around the urban center’s (Poor living conditions & Slum proliferation)
Government takes 18 months to clear one affordable housing project.
MHUPA in talk with Ministry of Finance, Defence, Culture, Civil Aviation & Environment to set up a system for faster clearance. Centre is also talking with states to reduce stamp duties, registration and conversion fees.
Single window clearance mechanism setup.
MoU between NHB, HUDCO with 140 lending agencies -> for extending financial support to housing projects under Credit linked subsidy component of Urban Housing Mission.
Main Hurdles:
-
- Shortage of land in urban areas
- Stringent land use regulations
- Inadequate infrastructure to support more housing neighborhood
- Rising cost of construction
- Insufficient financing
- Restricted mortgage financing and rent control law
Ministry aims to build 2 crore houses in urban areas by 2022.
What do you understand by ‘affordable housing‘, especially in urban areas, which governments strive to provide to urban poor? Critically examine what constraints exist in providing affordable houses to urban poor and how they can be overcome. (200 Words)
Urbanization in India is on the rise and solutions are searched to solve the issue of slums. While China bulldozed over its slums in run to the Beijing Olympics, Indian government is much more sensitive.
Providing affordable housing to the urban poor refers to construction and shifting of urban poor into colonies according to their income profile. Issues which rise are:
-
- Selection of proper site. Since slums are mostly in the cities so should be the housings else people may refuse to move. Proper connectivity is a must to ensure economic survival.
- Provisioning of facilities and maintenance. If not authorised, these colonies may not have proper water, power, etc. All these require advance planning.
- Check on return. Many slum dwellers put allotted housings on rents and return to the slums. This encourages others also and distorts our data.
- Long term sustainability of the idea as income profile of these people keeps fluctuating. So transferring properties in their names is better option than rents. Subsidies and loans can be given.
- Keeping number of people living in housings in check as it may attract more people and will itself become a slum.
- Purchasing power of individuals should be matched to demanded prices or to a certain minimum price.
- Transparency in allotment and purchasing power of aspirants.
The government should ensure supply side interventions like envisaged under JnNURM and Rajiv Awaas Yojana. The beneficiaries must be identified before construction in a transparent manner and be allowed to avail loans. This will ensure smooth process. On the other hand, government should also undertake dismantling of vacated slums.
Critically examine why despite launching several housing schemes for both urban and rural poor, there remain numerous homeless people in India. (200 Words)
Homeless people constitute 0.19% of India’s population according to the 2011 Census. This number does not include the poor who have managed to build unstable tent like shelters.Thus, the actual proportion is likely to be higher. While successive governments have launched many different schemes to ensure housing for all, there are still numerous homeless people due to the following reasons:
-
- Improper Formulation of Scheme – The schemes do not reflect the ground conditions in India. Most of them like Rajeev Awaas Yojana (RAY) have been based on interest subvention and subsidy. However, the poor do not have the wherewithal to be able to raise their own mandatory contribution for these schemes and hence are excluded from them.
- Low allocations – The amount of money sanctioned by schemes such as Indira Awaas Yojana (IAY) does not reflect market conditions and is too low.
- No monitoring of the schemes – Post roll-out, there is no monitoring of the implementation. Whether people who claim the benefits of the schemes actually utilise the money for building houses or whether that money is siphoned off is not known.
- Demand-Supply Gap – There is no incentive for private vendors to cater to the low cost housing segment and the government cannot meet the demand in this segment on its own. Thus, even when the schemes work well, a large proportion of the population is excluded from the benefits.
- Problems with land acquisition – There are also problem related to land acquisition for housing purposes. Which delays the whole process.
- Stakeholders such as banks and local authorities are not taken into account while formulating the policies and schemes. Banks refuse to provide loans due to increase in bad loans due to interest subversion and subsidy given
- Municipal authorities are responsible for providing basic facilities to the houses built, lack of co-ordination with them under the schemes has resulted in weak habitations.
- Increasing migration ; budgetary constraints; non substantive use of technology and innovation and poor quality of building material used etc. are important reasons for failure of these programs
- Improper urban planning which restrict the vertical expansion by imposing FSI rules.
- Non completion of Priority sector lending targets by the banks in which loans were to be provided to the people of EWS.
- Corruption in allotment of houses.
- Rising cost of homes because of black money in real state.
Housing is a basic necessity and lack of housing has an impact on issues like access to education, sanitation, nutrition etc. Recent initiatives like Land Pooling Policy in Delhi and Gujarat should be scaled up and incentives in the form of Viability Gap Funding must be provided to private vendors to help them enter the low cost housing market. Such an approach would be better able to increase supply and ensure that the dream of Housing for All for 2022 is fulfilled.
A recent news reported that the ministry of urban development had found that the funds set aside for schemes such as the Rajiv Rinn Yojana, the National Urban Livelihood Mission and the Rajiv Awaas Yojana are not being utilized. Critically examine why. (200 Words)
Non utilization of the funds earmarked by the Urban Development Ministry has its roots in the lack of proper thought in design and implementation of the schemes. Whenever populism dominates substance, results are unsatisfactory.
Reasons for this situation –
-
- Top down policy formation- Most of the policies having been forced upon from top have resulted in schemes being launched without preparing any ground. Launch of Rajiv Rinn Yojana without carrying out necessary reforms and streamlining urban land management has not been successful.
- Intermediaries out of consultation process- Similarly, intermediaries (e.g. banks) have been left out of consultation, resulting in their reluctance to offer loans to EW and LIG groups due to non-viability of business ( more than 25% less RoI).
- Unsustainable and impracticable schemes- Schemes like Jan –Dhan (insurance and over draft), Jan Suraksha and Jivan Jyoti (very low premium compared to coverage) are unsustainable and are mostly populist measures. Of course, banks have few incentives to implement them.
- Lack of awareness and prevalence of illiteracy– Since most of the targeted beneficiaries are from disadvantaged sections, a sound and exhaustive awareness campaign should have helped.
In order to really tackle any problem, wide ranging consultations are required between all the stakeholders – the target population, the implementing agencies, the political class etc. Only when there is an appreciation of the requirements and on ground conditions along with acceptability to all the stake holders could any such scheme become successful in its objectives.