Even as the Modi governments financial inclusion plan got off to a flying start recently through the Pradhan Mantri Jan Dhan Yojana (PMJDY), another budgetary announcement for a mission-mode programme for affordable housing is hanging fire for lack of clarity on many key concepts.
The Department of Financial Services (DFS), the nodal body on banks and financial institutions, in the finance ministry coordinating and implementing the financial policies on housing, has sought clarifications from the Prime Ministers Office on many aspects, including selection of beneficiaries so that the objective of Housing for All by 2022 can be achieved.
The lack of clarity, official sources told FE, is mainly due to the multiple definitions of the target group economically weaker segment (EWS) and low income group (LIG) under different laws and existing schemes in terms of income and area of the houses meant for them as well as the definitions on low-cost and affordable housing.
Lack of uniformity in definitions and inadequate clarity regarding fiscal and non-fiscal incentives under different Acts and schemes are also posing trouble.
Finance minister Arun Jaitley in his Budget speech merely said that he proposes to allocate this year R4,000 crore to the National Housing Bank (NHB) to increase the flow of cheaper credit for affordable housing to the urban poor/EWS/LIG segment. It is not clear yet whether this will be in the form of only budgetary allocation or whether it would also include the priority-sector lending shortfall amount that banks provide to the NHB and other institutions as directed by the Reserve Bank of India (RBI).
The shortage of housing in the country is now estimated at is around 19 million, of which LIG/EWS category shortage is around 96%. By 2022, the overall housing shortage is likely to be at least 30 million, as per the governments estimate.
The relevant laws and schemes include the Income Tax Act, the ministry of housing and urban poverty alleviation (JNNURM Mission Directorate) scheme of affordable housing in partnership, National Urban Housing and Habitat Policy, different state housing and habitat policies, Real Estate (Regulation and Development) Bill, 2013, Rajiv Rinn Yojana (for interest subvention) and the Reserve Bank of Indias guidelines.
Another complication is that many previous affordable housing-related schemes had the middle income group (MIG) also as one of the beneficiary categories along with EWS and LIG. However, the budgetary