TAG: GS 2: GOVERNANCE
THE CONTEXT: Recently, in a significant move, government has approved the construction of three crore additional houses under the Pradhan Mantri Awas Yojana (PMAY).
EXPLANATION:
Key Decision Overview
- The approved expansion includes:
- Two crore houses under PMAY-Gramin (PMAY-G)
- One crore houses under PMAY-Urban (PMAY-U)
- The expansion of PMAY aims to promote a dignified life and ease of living for millions.
- This decision reflects the commitment of the govt to make the living standards of the people easier.
- This will not only fulfill the need of people for houses, but will also provide them a quality life.
Financial Assistance and Implementation
- The Cabinet decision includes an increase in financial assistance to PMAY-G beneficiaries:
- Current assistance: Up to Rs 1.2 lakh in plains, Rs 1.3 lakh in hilly states, difficult areas, and tribal and backward districts.
- New assistance: Increased to Rs 1.8 lakh in plains and Rs 2 lakh in hilly areas.
- The funding model remains a cost-sharing arrangement between the Centre and the states:
- Plains: 60:40 ratio
- Northeastern states, two Himalayan states, and the UT of Jammu and Kashmir: 90:10 ratio
- Other Union Territories, including Ladakh: 100% funded by the Centre
Historical Context and Achievements
- Since its inception in 2016, PMAY-G has sanctioned 2.95 crore houses, with 2.61 crore already completed.
- The newly approved two crore houses will be in addition to these, ensuring continued progress towards the housing needs of the expanding rural population.
- The decision aligns with the Interim Budget for 2024-25, presented by Finance Minister.
- In the budget speech, Finance Minister announced the government’s plan to construct two crore additional houses under PMAY-G over the next five years, addressing the housing demands due to the growing number of families.
Immediate Actions and Impacts
- Following the Cabinet meeting, Prime Minister signed his first file authorizing the release of the 17th installment of the PM Kisan Nidhi, benefiting 9.3 crore farmers with a disbursement of around Rs 20,000 crore.
- The government’s dedication to farmer welfare, aligning the housing initiative with broader socio-economic development goals has been emphasized.
- In a strategic move, Union Minister Shivraj Singh was appointed to oversee the agriculture and rural development portfolios.
- This appointment underscores the government’s focus on integrated rural development and welfare.
Pradhan Mantri Awas Yojana (PMAY):
- The Pradhan Mantri Awas Yojana (PMAY) was launched in 2015 as a flagship program aimed at providing “Housing for All” by 2022.
- The two basic components of the scheme are Pradhan Mantri Awas Yojana (Urban) (PMAY-U) for the urban poor and Pradhan Mantri Awaas Yojana (Gramin) (PMAY-G or PMAY-R) for the rural poor.
- It encompasses both urban and rural areas, with a focus on addressing the housing needs of economically weaker sections and low-income groups.
- Under PMAY, various verticals are designed to cater to different segments of the population, including in-situ slum redevelopment, affordable housing partnerships, and beneficiary-led construction.
- Objectives of the PMAY Scheme are:
- Rehabilitation of Slum Dwellers: One of the primary objectives of PMAY is to rehabilitate slum dwellers by involving private developers in the process.
- Promotion of Affordable Housing: PMAY aims to promote affordable housing for weaker sections through Credit Linked Subsidy Schemes (CLSS) and partnerships with public and private sectors.
- In-Situ Slum Redevelopment (ISSR): The scheme targets the redevelopment of slums in their existing locations to provide better housing conditions for residents.
- Subsidy for Beneficiary-led Construction (BLC): PMAY provides subsidies to beneficiaries for constructing their own houses.
Performance of the PMAY Scheme
- Despite the initial target of achieving “Housing for All” by 2022, the scheme has faced challenges in implementation and has been extended until December 31, 2024.
- However, the progress has been inadequate, with significant shortfalls in the number of houses constructed compared to the actual demand.
- The scheme has fallen short of its objectives, with an estimated shortage of around 20 million houses in rural areas and three million in urban centers.
- The in-situ slum redevelopment (ISSR) vertical, which addresses a critical need in cities, has particularly underperformed, with only a fraction of the sanctioned houses completed.
- Several factors contribute to the challenges faced by PMAY, including land acquisition issues, inadequate community involvement in planning, and discrepancies between city master plans and PMAY objectives.
- Additionally, reliance on large capital-intensive solutions and limited government contribution to investment expenditure pose significant hurdles.