The union cabinet has given approval to the Housing for All by 2022. With an objective of providing accommodation to the Economically Weaker Section (EWS) and Low Income Group (LIG), Housing for All envisions building 2 crore new houses by 2022. Set to become one of the landmark initiative undertaken by the government in the recent time- It will not only solve the housing crisis of an emerging economy such as India but can also spearhead a new wave of urban development.
The Housing for All primarily involves slum re-habitation, offering subsidized credit to the EWS and LIG segment and provision of assistance in house renovation. It also includes investment towards developing the infrastructure and civic amenities in the under developed and rural areas. It will be phased out in 3 stages comprising of over 4000 towns and locations in pan India.
Slum Re-Habitation
Slum Re-Habitation is an important constituent of the overall policy with an objective of achieving a slum free India in next seven years. Based on the Gujarat model, it will involve private developers, developing vertical buildings as affordable housing offerings for the slum inhabitants. In return, the private developers can utilize the rest of the land and hence derive commercial benefits out of it.
Subsidized Credit
Under the Subsidized Credit policy, the EWS and LIG section can afford subsidized credit with a modest interest of 6.5%. This can be a great money saver for the under privileged sections of the society. Earlier an INR 6 Lacs housing loan for 15 years with an interest rate of 10.5% will tantamount to an EMI of 6,632. In contrast under the new policy the EMI will come down to INR 4,050, reflecting a considerable savings.
Multidimensional Benefits
The policy has all the required ingredient that can ensure multidimensional benefits by positively influencing various stakeholder involved. The biggest beneficiary would of course include the under privileged section of the society in the form of availing decent housing alternatives. Likewise, the money saved from the help of financial assistance could be diverted into education and other spending thereby further helping the EWS and LIG segments.
The introduced policy will stimulate more activities in the realty sector, thereby helping the realty sector player. It is also expected that in order to streamline the overall process, the government will introduce processes to incentivize the participation of private developers in affordable housing in the form of easier land acquisition policy and better credit etc.
Similarly it can also beckon a new wave of urban development in the form of satellite cities, new communities focused on affordable housing and development of peripheral parts of the cities. In order to facilitate the overall process, the central government in conjunction with state government will invest in infrastructure development as well in the chosen areas. This will in turn attract business and entrepreneurial investment in such places, consequently resulting into better employment opportunities and economic advancement. Additionally, the overall holistic development carried out can be a check on migration towards bigger cities.
Challenges
The ambitious plan envisions housing for everyone by 2022, thereby heralding a new era of growth and development for the nation. However, the overall plan is not insulated with challenges. The central government has to ensure that central and state government along with urban development agencies and municipalities work in tandem with each other for smoother execution. A possible disagreement between different authorities can decelerate the growth momentum.
Likewise, the government needs to undertake prudential steps towards curbing down any possible scope of corruption. The overall process needs to be transparently designed and should be monitored properly by the government agencies to ensure equitable distribution.
Similarly the overall process will be ineffective unless not backed up with a robust infrastructure development framework in the background. It is essential that government should take strong measures to ensure a powerful infrastructure equipped with better connectivity, sanitation, water supply and electricity etc.
