Rapid urbanisation in India has given rise to a pressing housing crisis, significantly impacting low-income households. The Technical Group on Urban Housing Shortage, operating under the Ministry of Housing and Urban Affairs (MoHUA), has shed light on the severity of the situation. Between 2012 and 2017, the group estimated a staggering shortage of 18.78 million urban houses. This figure alone underscores the magnitude of the housing deficit, revealing the inadequacy of the existing infrastructure to meet the burgeoning urban population's accommodation needs.
Even more alarming is the subsequent revelation by the Indian Council for Research on International Economic Relations (ICRIER). Their report in 2018 disclosed a disturbing 54% surge in urban housing shortages, catapulting the deficit to a staggering 29 million. This sharp escalation within a relatively short timeframe underscores the urgency for comprehensive and immediate action to address the crisis.
The implications of such housing shortages extend beyond mere numbers; they encapsulate the struggles and challenges faced by millions of low-income families striving for basic shelter. The repercussions encompass the lack of physical dwelling spaces and the associated issues of inadequate sanitation, compromised health conditions, and limited access to education and employment opportunities.
The Interim Budget 2024-25 emphasizes the 'Housing for All' agenda by launching a scheme to assist deserving sections of the middle class living in rented houses, slums, chawls, and unauthorized colonies in acquiring their own homes. The flagship PMAY–Urban scheme has received a significant allocation of Rs 26,170 crore, marking an 18% increase over the previous fiscal year.
As of January 29, 2024, 118.63 lakh houses had been sanctioned under PMAY-U, with 80.02 lakh houses completed. The scheme comprises four verticals: In- situ slum redevelopment (ISSR), credit-linked subsidy for housing (CLSS), affordable housing in partnership (AHP), and enhancement and construction of beneficiary houses (BLC).
Despite progress, several factors limit the PMAY-U's potential to achieve its goals within the stipulated time frame. ISSR, crucial for addressing slum dwellers' housing needs, faces legislative difficulties, limited private sector participation, and inadequate civil society involvement. Furthermore, the interest rate subvention for housing loans for economically weaker sections (EWS) needs to be increased, leading to affordability concerns and exclusion from the housing market.
Complications in urban planning, outdated land development regulations, and opaque beneficiary selection processes contribute to inadequate land supply and high land prices. Private sector engagement remains lukewarm, hindering the effective implementation of PMAY-U. Moreover, the lack of local capacity and technical expertise results in the underutilization of funds.
Urgent steps are needed to unlock PMAY-U's full potential. Legislative hindrances and bureaucratic delays must be addressed, with a focus on slum redevelopment. Subsidy amounts, especially under ISSR, require upward revision. A participatory approach involving scheme beneficiaries is essential for meaningful implementation. Collaboration with financial sector regulators and planned private sector involvement are crucial. Reflecting on past lessons can guide the development of effective policies to house the growing urban population, particularly those with low incomes.
A multifaceted approach is imperative to mitigate the crisis. Policymakers must consider innovative solutions such as sustainable urban planning, affordable housing initiatives, and community-driven development projects. Collaboration between Government bodies, private enterprises, and non-profit organisations is crucial to ensure a holistic and effective strategy. By tackling the housing crisis head-on, India can pave the way for inclusive urban development, fostering a healthier, more resilient society for all its citizens.
(The writer, who is based at Brahmapur, is a former Professor of Economics, Gokhale Institute of Politics and Economics, Pune)
