Deconstructing PMAY-U: What the Numbers Reveal
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Abstract
The Pradhan Mantri Awas Yojana Urban (PMAY-U), an ongoing programme since 2015, is India’s largest urban housing programme. An unprecedented 11.9 million houses, which is about 10 per cent of the Census 2011 urban housing stock, have been sanctioned across its five sub-schemes. The aggressive housing agendas of a few states and the popularity of the Beneficiary-Led Construction (BLC) sub-scheme (which provides subsidies for the construction of a house to land-owning Economically Weaker Section (EWS) households—i.e., households with an annual income of Rs 3 lakh or less) in small cities were key to PMAY-U’s scale. We find that PMAY-U better serves small cities compared to million-plus cities. Two aspects of PMAY-U warrant attention: its poor coverage of slum households and the significant number of delayed and yet-to-be-completed houses. Some of the issues affecting PMAY-U’s implementation are specific to PMAY-U and easier to resolve, while others are systemic in nature. Some of the systemic issues are complex property records and registration systems, slow dispute resolution, and EWS households’ poor access to institutional finance. Based on our findings, we propose improvements in programme design and monitoring, as well as broader systemic measures required to make the recently announced second phase of PMAY-U more impactful than the first.
Q&A with the authors
- What is the core message conveyed in your paper?
PMAY-U has been unprecedented in its scale and impact on low-income housing across India’s towns and cities. The Union government’s push supplemented by the efforts of state governments has been crucial in driving PMAY-U’s scale. Its impact has been more in small cities compared to bigger cities, due to BLC’s (subsidies to households for construction of independent houses on own land) success in the small cities. In addition to continue serving EWS households in small cities, PMAY-U’s next phase should focus on EWS households living in the million-plus cities, and on slum households living across all city classes. Some small adjustments in PMAY-U’s programme design, improved monitoring of its implementation along with broader reforms aimed at correcting the systemic challenges related to land and urban poor’s access to institutional home loans, will be critical in ensuring PMAY-U 2.0 is even more impactful than PMAY-U.
- What presents the biggest opportunity?
PMAY-U’s demand-side sub-schemes Beneficiary-Led Construction (BLC) and Credit-Linked Subsidy Scheme (CLSS) have been more successful than its supply-side sub-schemes Affordable Housing in Partnership (AHP) and In-Situ Slum Redevelopment (ISSR). PMAY-U 2.0 should focus on building up on BLC’s and CLSS’s success. Easing the land ownership documentation process is critical for building on BLC’s success, across states. In case of CLSS if the focus is on enhancing its reach among EWS households, CLSS can prove to be pivotal in ensuring the EWS households living in million-plus cities are also well covered.
- What is the biggest challenge?
Land continues to present the biggest challenge for development of low-income housing. Complex land ownership registration process makes it difficult for low-income households to garner the required land documentation for accessing government subsidies. Complex and inefficient land systems and a slow judicial resolution in case of disputes, adversely affects land acquisition for the development of low-income flats. Most importantly, land availability at suitable locations is a perennial challenge and slows down the entire process of development.
Thus, PMAY-U 2.0’s monitoring mechanism should extend to tracing the on-ground adoption, implementation, and impact of PMAY-U’s mandatory conditions (which states need to fulfil to be eligible for central assistance) such as – single window approval system, waiving off the requirement of permission for using agricultural land for development of EWS flats, and inclusion of affordable housing zones in master plans.
Debarpita Roy
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The Centre for Social and Economic Progress (CSEP) is an independent, public policy think tank with a mandate to conduct research and analysis on critical issues facing India and the world and help shape policies that advance sustainable growth and development.