Urban housing: The Union Cabinet has recently approved the Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0 scheme, under which one crore homes in urban areas will be constructed between 2024-25 and 2028-29. The Pradhan Mantri Awas Yojana – Urban 2.0 (PMAY-U 2.0) is a government initiative aimed at providing financial assistance to middle-class and urban impoverished families. The primary objective of PMAY-U 2.0 is to enable eligible beneficiaries to either construct, purchase, or rent affordable housing units in urban areas. This initiative aligns with the Indian government’s overarching objective of enhancing the standard of living for all citizens by ensuring access to durable housing solutions.
Besides, the Cabinet has also granted permission for the implementation of the Pradhan Mantri Awaas Yojana-Gramin (PMAY-G) during the Financial Year 2024-25 to 2028-29. Union Information and Broadcasting Minister Ashwini Vaishnaw said the scheme aims to construct a total of three crore new houses under the Pradhan Mantri Awas Yojana. Out of these, two crore houses are designated to be built in rural areas while one crore will be constructed in urban areas. The budgetary provision for the scheme is set at Rs 3.61 lakh crore rupees.
Main beneficiaries
The PM India website stated: “Special attention will be given to marginalized groups, including slum dwellers, SC/STs, minorities, widows, persons with disabilities, and other underprivileged sections of society. Additionally, groups like Safai Karmi, street vendors, artisans, anganwadi workers, and residents of slums/chawls will receive focused support under this scheme.”
Eligibility or who all can apply
The PMAY-U 2.0 scheme is meant for families who belong to the Economically Weaker Section (EWS), Low Income Group (LIG), and Middle Income Group (MIG) segments and do not currently own a pucca house anywhere throughout the country.
The eligible income criteria for homeowners are as follows:
> EWS households with an annual income up to Rs 3 lakh.
> LIG households with an annual income between Rs 3-6 lakh.
> MIG households with an annual income between Rs 6-9 lakh.
Eligibility in urban areas
> Under the Beneficiary-Led Construction (BLC) vertical, financial assistance will allocated to qualified individual families in the economically weaker sections (EWS) to facilitate the construction of new houses on their own available vacant land. In scenarios involving beneficiaries without land, States/Union Territories (UTs) may grant land rights (pattas).
> In the Affordable Housing in Partnership (AHP) initiative, EWS beneficiaries receive financial aid for the acquisition of houses under construction through various partnerships established by States/UTs, cities, and public or private agencies.
> Affordable Rental Housing (ARH) is a designated segment dedicated to the development of rental properties aimed at catering to the housing needs of working women, industrial workers, urban migrants, and other qualified recipients. The ARH initiative will be executed through two primary approaches: repurposing currently unoccupied government-funded residences and constructing new rental accommodations. In support of projects incorporating innovative construction technologies, a Technology Innovation Grant (TIG) of Rs 3,000 per square meter will be allocated.
Financial assistance
Under the Pradhan Mantri Awas Yojana-Urban 2.0, financial assistance will be extended to one crore urban poor and middle-class families. This assistance will be channeled through States, Union Territories, and Primary Lending Institutions (PLIs) to facilitate the construction, purchase, or rental of houses at affordable rates in urban areas over a span of five years. The government has allocated a substantial sum of Rs 2.30 lakh crore rupees for this scheme.
Additionally, within urban regions, provisions have been made for the establishment of working women hostels.
Interest Subsidy Scheme (ISS)
Furthermore, an interest subsidy of 4% will be provided for home loans up to Rs 25 lakh for individuals falling under the categories of Economically Weaker Section (EWS), Low Income Group (LIG), and Middle Income Group (MIG).
Funding Mechanism
The cost of house construction under PMAY-U 2.0 will be shared among the Ministry, State/UT/ULBs, and beneficiaries, with varying cost-sharing patterns depending on the region.
Here’s the sharing pattern:
Additionally, the Credit Risk Guarantee Fund Trust (CRGFT) corpus has been increased from Rs 1,000 crore to Rs 3,000 crore to support affordable housing loans.
Technology & Innovation Sub-Mission (TISM)
Under the Pradhan Mantri Awas Yojana-Urban 2.0 (PMAY-U 2.0), a Technical Institution Support Mission (TISM) will be established to provide guidance and support in the adoption of modern, innovative, and environmentally friendly technologies for the construction of houses. The primary objective of this mission is to facilitate faster and superior-quality construction practices while promoting disaster-resistant and climate-conscious housing solutions nationwide.
It is mandatory for States and Union Territories (UTs) to develop an “Affordable Housing Policy” that encompasses essential reforms and incentives to stimulate the participation of both public and private sectors in the affordable housing domain. This policy is expected to play a pivotal role in enhancing housing affordability and attaining the overarching goals of the PMAY-U 2.0 initiative, a note issued by PIB said.