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This is an archive article published on November 29, 2004

Govt prods states on low-cost housing

Worried that the urban poor — standing at 46.78 million — would emerge as a more vulnerable group than those in villages, the Cent...

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Worried that the urban poor — standing at 46.78 million — would emerge as a more vulnerable group than those in villages, the Centre is planning to do its bit to help states run their lower-end housing schemes. This apart, the schemes are set for an overhaul, in terms of design and funding method, to ensure they are feasible.

The government is planning to provide ‘Additional Central Assistance’ to states for which the Ministry of Urban Employment and Poverty Alleviation will be the nodal agency. The ministry will disburse and monitor the housing-for-all schemes targeted at the Economically Weaker Section (EWS) and the Lower Income Group (LIG).

The ministry estimates that around 22.4 million houses will be needed to keep up with the Prime Minister’s ‘‘Shanghai vision’’ for the 35 metros. Though poverty alleviation is a crucial element of the UPA’s National Common Minimum Programme, the Ministry is yet to formulate the housing bill in the past six months. The present scheme of providing free land and 50 per cent of the project cost to the states has not worked as the states have not been able to carry it through. Besides, wooing private players to build houses has been a tough ask.

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However, the Centre has made it clear that ‘‘the government is only going to be the facilitator’’ for the low-cost housing schemes. It is now toying with the idea of adopting the Holland model — make provisions for EWS/LIG houses on rent so that builders can reap long-term benefits by building the low-cost houses.

Besides the problem of finding free land, the government has to also solve the issue of loans. Going by terse guidelines prepared for the two-day conference of ministers of housing of states and UTs, the lower-end schemes, such as VAMBAY, NRY, UBSP and UPEP, have not yielded results. State governments have already, in preliminary meetings, sought enhancement in pre-unit cost of VAMBAY from Rs 50,000 to Rs 1 lakh.

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