PIB Press = Release

Background

Government=20 of India has=20 recognized that housing is a very important source of employment; = has a=20 large multiplier effect on the economy and demand in about 20=20 manufacturing sectors; and there is a large unmet need for housing = in the=20 country, especially for middle and low income groups. Housing = finds a=20 prominent place in the sectors with potential for employment and=20 investment opportunities. The sector has therefore, figured = in the=20 various stimulus packages announced by the=20 Government.

In=20 the current financial year, the Government maintaining that lower = and=20 middle income housing deserves to be supported to stimulate this = segment=20 of house owners, has announced one per cent interest subsidy to=20 individuals for loans up to Rs 10 lakhs for houses that do not = cost more=20 than Rs 20 lakhs. The interest subsidy will be routed through the=20 scheduled commercial banks and the housing finance companies = registered=20 with the National Housing Bank. This interest subsidy will be = available=20 for a period of one year. = A=20 subsidy of Rs 1,000 crore will be provided this purpose. In order = to=20 provide a further stimulus to the housing sector by providing tax = relief,=20 it has been decided to amend Section 80 IB (10) of the Income Tax = Act so=20 as to allow the tax holiday in respect of profits derived from = projects=20 approved between the 1st April 2007 to 31st March, 2008; if such = projects=20 are completed on or before 31st March, 2012.

=20 In follow-up of various packages and its own objectives of = tackling=20 the housing shortage, the Ministry has launched two new schemes = and is in=20 the process of launching another scheme by the name of Rajiv Avas = Yojana=20 (RAY).=20

Proposed=20 Rajiv Awas Yojana (RAY)

The=20 Jawaharlal Nehru National Urban Renewal Mission (JNNURM) in the = last four=20 years is reshaping our cities and has been widely welcomed. It = will=20 continue to focus on infrastructure, basic services and governance = reform=20 and increase support to cities to upgrade public transport. Over = 15 lakh=20 houses are under construction for the urban poor. There is a need = to focus=20 urban housing programmes on the poor living in slums.=20

The=20 UPA Government proposes to introduce a Rajiv Awas Yojana for the = slum=20 dwellers and the urban poor. The schemes for affordable housing = through=20 partnership and the scheme for interest subsidy for urban housing = would be=20 dovetailed into the Rajiv Awas Yojana which would extend support = under=20 JNNURM to States that are willing to assign property rights to = people=20 living in slum areas. The Government's effort would be to create a = slum=20 free India=20 through the Rajiv Awas Yojana.

Hon=92ble=20 MHUPA & T and Secretary (HUPA) had a series of meetings with = nodal=20 Secretaries of States/UTs, Vice-President/CEOs of Urban = Development=20 Authorities and Municipal Commissioners of select cities/towns, = Technical=20 Advisory Group (TAG)=20 members, Slum Federation of India and select experts/NGOs to = discuss and=20 finalize the possible elements of the proposed scheme.

The=20 Concept Note on RAY was=20 finalized and sent to Planning Commission for their =91in = principle=92=20 approval. The Planning Commission has accorded its =91in = principle=92 approval=20 for the proposed scheme recently. The draft guidelines of the = scheme has=20 been prepared and circulated to all States/UTs/Central Ministries = and=20 experts/NGOs for comments.

Developing a robust = database on=20 slums is critical for implementation of the proposed Rajiv Awas = Yojana=20 (RAY).=20 The Ministry of HUPA has released funds for = Slum/Household/Livelihoods=20 surveys in 394 class I cities having more than one lakh population = in the=20 country. The surveys are in progress. Funds will also be = released for=20 other towns/cities in a phased manner. An e-enabled MIS is being = developed=20 for processing of data and building a national=20 database.

Jawaharlal=20 Nehru Urban Renewal Mission=20 (JNNURM)

=B7 =20 More=20 than 14.5 lakh houses sanctioned all over the country=20 (14,59,272).

=B7 =20 1304=20 projects of affordable housing and basic amenities to the urban = poor with=20 outlay of more than Rs 33,860 crores approved. =

=B7 =20 Additional=20 Central Assistance (Grant) of Rs. 18,500 crores committed = (representing=20 more than 100% of the 7-year allocation initially provided for=20 2005-12)

=B7 =20 Additional=20 Central Assistance (ACA) of Rs 7192.02 crores released to =20 States/UTs.

=B7 =20 63=20 Mission=20 cities covered under BSUP & 761 cities/towns covered under=20 IHSDP.

=B7 =20 About=20 3.81 lakh houses in progress and 1.65 lakh dwelling units = completed as=20 against the mid-term target of 5 lakhs units in progress.

=B7 =20 Progress=20 of 3 key pro-poor reforms (Land reservation for urban poor, = earmarking=20 of municipal budget for the urban poor and implementation of = 7-Point=20 Charter for the urban poor and under JNNURM largely on=20 track.

=B7 =20 Financial=20 support for setting up of 23 Programme Management Unit (PMU) at = State=20 level in 23 States/UTs approved.

=B7 =20 Financial=20 Support for setting up of 101 Project Implementation Units (PIUs) = at Urban=20 Local Body (ULB) level approved.

=B7 =20 An=20 Online JNNURM tracking system as part of Integrated Poverty = Monitoring=20 System is developed and is under = implementation

=B7 =20 A=20 framework for Third Party Inspection and Monitoring established = and=20 agencies for Third Party Inspection and Monitoring empanelled by = Mission=20 Directorate. Detailed guidelines have been issued to States.=20

=B7 =20 States=20 have been exhorted to start preparations for social audit of = projects=20 under BSUP & IHSDP. All detailed project reports and minutes = of BSUP=20 & IHSDP have been put on the website to establish transparency = and=20 sharing of information.

=B7 =20 A=20 Toolkit on comprehensive capacity Building programme has been = developed=20 and circulated to all State/UT Governments. Financial assistance = is being=20 provided for skill training, capacity building, and City/State = urban=20 resource centres.

=B7 =20 More=20 than 90 capacity building/handholding programmes have been = conducted=20 across the country and more than 12,000 State/parastatals/local = body=20 officials trained in project formulation, design, implementation = and=20 monitoring.

Cumulative=20 Physical Progress (As on 31.10.2009)

BSUP

IHSDP

Total

No=20 of projects approved

462

842

1304

No=20 of States/UTs covered

No=20 of Cities/Towns covered

761

824

No=20 of DUs approved

995183

464089

1459272

No.=20 of DUs on which construction = started

293674

88235

381909

No.=20 of DUs completed

122981

42570

165551

Cumulative=20 Financial Progress (As on 31.10.2009)

Commitment=20 & Release (in Crores)

BSUP

IHSDP

Total

Revised=20 Allocation

16356.35

6828.31

23184.66

ACA=20 Commitment

12807.32

5692.08

18499.40

%=20 Commitment

78.30%

83.36%

79.80%

Release

4212.31

3000.87

7213.18

%=20 Release (Release vs Commitment)

32.72%

52.72%

39.00%

Total=20 project cost approved

25342.77

8517.45

33860.22

=B7 =20 Progress=20 on 3 Pro-Poor Key Reforms under JNNURM (BSUP &=20 IHSDP)

o =20 Progress=20 of 3 key reforms largely on track

o =20 Internal=20 earmarking within local body budgets for Basic Services to the = Urban=20 Poor: 48 cities = have=20 undertaken implementation of this reform

o =20 Earmarking=20 of at least 20-25% of developed land in all housing projects (both = public=20 and private agencies) for EWS/LIG category:

o =20 17=20 States (43 Cities) have issued the policy directives to reserve = developed=20 land in public and/or private housing = projects

o =20 Implementation=20 of 7- Point Charter: Provision of 7 Basic=20 Entitlements/Services:

o =20 This=20 reform is to be implemented in a staggered manner over the Mission = Period=20 in convergence with the programmes of other Ministries as this is = also an=20 outcome of the Mission.

Interest=20 Subsidy Scheme For Housing The Urban Poor = (ISHUP)

Interest=20 Subsidy Scheme for Housing the Urban Poor (ISHUP) has been = conceived for=20 providing interest subsidy on housing urban poor to make the = housing=20 affordable and within the repaying capacity of EWS/LIG. The scheme = encourages poor=20 sections to avail of loan facilities through Commercial = Banks/HUDCO for=20 the purposes of construction of houses and avail 5% subsidy in = interest=20 payment for loans upto Rs. 1 lakh. =20 The total interest subsidy requirements for the = construction of=20 3.10 lakhs houses for EWS/LIG segments financed during the next 4 = years=20 (2008-12) is projected at Rs. 1100 crores.

The=20 Scheme will leverage flow of institutional finance for the EWS and = LIG=20 segment households and result in creation of additional housing = stock of=20 3.10 lakh houses for EWS/LIG segments over the next 4 years = (2008-12) out=20 of which 2.13 lakh dwelling units are targeted for EWS housing and = 0.97=20 lakh for LIG housing. Households with monthly income of upto Rs = 3,300 are=20 classified as EWS while those with monthly income between Rs 3,300 = and Rs=20 7,300 are termed LIG.

Loan=20 will be available for construction of new houses. Loan repayment = periods=20 will be permissible generally ranging form 15-20 years. The = subsidy will=20 be 5% p.a. for EWS and LIG, admissible for a maximum loan amount = of Rs. 1=20 lakh over the full period of the loan. Beneficiary borrowers may = choose=20 fixed or floating rates (the consequences clearly explained to the = borrowers by PLIs). An additional 1% p.a. maximum will be = permitted to be=20 charged by banks/HFCs if fixed rate loans are extended which will = be=20 subject to reset after a minimum period of 5 years. Mortgage of = the=20 dwelling unit be accepted as primary security. However, there = would be no=20 collateral security/third party guarantee for loans upto and = inclusive of=20 Rs. 1 lakh excluding group guarantee. No levy of prepayment = charges would=20 be permitted.

Under=20 the scheme, preference (subject to beneficiaries being from = EWS/LIG=20 segments) will be given to Scheduled Caste, Schedule Tribe, = Minorities,=20 Person with disabilities and women beneficiaries in accordance = with their=20 proportion in the total population of city/urban agglomerate = during the=20 2001 census.

In=20 order to disseminate the details of Scheme and clarify doubts, = this=20 Ministry has held two consultations with Housing Secretaries of = States/UTs=20 and representatives of Public Sector Banks (PSBs) on 4th and 22nd = May=20 2009. Banks/HFIs which have to act as the Primary Lending = Institutions=20 (PLIs) have responded well to the scheme and so far the following=20 Banks/HFIs have signed Memorandum of Agreement (MOA) with the two = Central=20 Nodal Agencies (CNAs), namely National Housing Bank (NHB) & = Housing=20 & Urban Development Corporation Ltd. (HUDCO) who are to act as = financial intermediaries for release of subsidy to PLIs under the=20 Scheme.

Banks

1. =20 State Bank of=20 India

2. =20 Oriental Bank of=20 Commerce

3. =20 United Commercial = Bank=20 (UCO = Bank)

4. =20 Indian=20 Bank

5. =20 Corporation=20 Bank

6. =20 Punjab & Sind=20 Bank

7. =20 Syndicate=20 Bank

8. =20 Union Bank of India=20

9. =20 Punjab National=20 Bank

10. = Central Bank of=20 India

11. = Bank of=20 Baroda

12. = State Bank of=20 Mysore

13. = Allahabad=20 Bank

14. = Jammu & Kashmir=20 Bank

15. = Vijaya=20 Bank

16. = Dena=20 Bank

17. = Karnataka Bank=20 Ltd.

HFCs

1. =20 Housing Development = &=20 Finance Corporation (HDFC) Ltd.

2. =20 Housing & Urban=20 Development Corporation (HUDCO) Ltd. =20

3. =20 Dewan Housing = Finance Ltd.=20 (DHFL)

4. =20 LIC Housing Finance=20 Ltd.

5. =20 Manipal Housing = Finance=20 Ltd.

6. =20 Vishwakriya Housing = Finance=20 Ltd.

This=20 has further been followed up by visits to different states and = meetings=20 with the State Secretaries, Municipal Commissioners, Senior level = bank=20 officers etc. and during last three months Gujarat, Maharashtra, = Kerala,=20 Karnataka, Andhra Pradesh, Madhya Pradesh, Uttar Pradesh, = Rajasthan,=20 Orissa and Chhattisgarh have been covered. The response of the = States has=20 been encouraging and the scheme has been received well by the = State=20 Governments.

Affordable Housing = in=20 Partnership

The=20 Scheme of Affordable Housing in Partnership aims at = operationalising the=20 strategy envisaged in the National Urban Housing & Habitat = Policy=20 (NUHHP) 2007, of promoting various types of public-private = partnerships =96=20 of the government sector with the private sector, the cooperative = sector,=20 the financial services sector, the state parastatals, urban local = bodies,=20 etc. =96 for realizing the goal of affordable housing for all.=20

The=20 Scheme has been introduced as part of the Jawaharlal Nehru = National Urban=20 Renewal Mission (JNNURM) and developed after consultation with = States/UTs=20 who have agreed to make urban land available at affordable rates.=20

The=20 scheme is primarily applicable to the 65 cities covered under the = BSUP=20 programme. Other cities of population above 5 lakhs could be = considered=20 during implementation with approval of the National Steering Group = for=20 JNNURM, if adequate number of projects is not forthcoming from the = 65=20 cities. However, project proposals from non-BSUP towns could be = considered=20 for sanction based on a review of the implementation of the Scheme = by the=20 Ministry of Housing & Urban Poverty Alleviation after two=20 years.

The=20 basic aim of the Scheme is to provide stimulus to economic = activities=20 through affordable housing programmes in partnership including = with the=20 private sector. The Scheme will also strive to ensure equitable = supply of=20 land, shelter and services at affordable prices to all sections of = society, and thereby to prevent the growth of slums in urban = areas. The=20 projects which should be eligible under this scheme for assistance = would=20 need to meet the following two criteria:

1) =20 Dwelling=20 units should be a mix of EWS/LIG/MIG=20 categories with the maximum size of a dwelling unit being at 1200 = square=20 feet super area, with at least 25% of them for EWS of about 300 = square=20 feet. In terms of carpet area, the minimum carpet area for EWS = category=20 shall be 25 square metres and maximum carpet area for=20 MIG=20 category shall be 80 square metres.

2) =20 The=20 sale price of dwelling units should have an upper ceiling in terms = of=20 Rupees per square metre of carpet area. The price ceiling would be = settled=20 in consultation with the States/UTs for different classes of=20 cities.

Nine=20 project proposals have been received by the Ministry. The same are = being=20 appraised.

Draft Model Real = Estate=20 (Regulation of Development) Act 200_____

In=20 order to promote planned and healthy real estate development of = colonies=20 and=20 apartments with a view to protecting consumer interest on the one = hand and=20 to facilitate smooth and speedy urban construction on the other; = Ministry=20 of Housing & Urban Poverty Alleviation has drafted a draft = Model Real=20 Estate (Regulation of Development) Act 200_____. The draft bill can be = accessed on=20 the website of the Ministry (http://mhupa.gov.in)=20 under "What is = new"=20 ticker. =20

The=20 draft bill seeks to establish =20 a Regulatory Authority and an Appellate Tribunal to = regulate,=20 control and promote planned and healthy development and = construction,=20 sale, transfer and management of colonies, residential buildings,=20 apartments and other similar properties, and to host and maintain = a=20 website containing all project details, with a view to protecting, = on the=20 one hand the public interest in relation to the conduct and = integrity of=20 promoters and other persons engaged in the development of such = colonies=20 and to facilitating on the other the smooth and speedy = construction and=20 maintenance of such colonies, residential buildings, apartments = and=20 properties and for matters connected therewith or incidental = thereto.=20

The=20 bill provides for compulsory registration with the Regulatory = Authority=20 for development of land into a Colony of plots or construction of = a=20 building or conversion of any existing building or part thereof = into=20 apartments, for the purpose of marketing all or some of the = apartments,=20 except when the area of land proposed to be developed into a = colony does=20 not exceed one thousand square meters or the number of apartments = proposed=20 to be constructed does not exceed four.

The=20 bill also provides that no promoter shall issue or publish an=20 advertisement or prospectus, offering for sale any plot, building = or=20 apartment, or inviting persons who intend to take such plots, = buildings or=20 apartments to make advances or deposits without registering with = the=20 Regulatory Authority and without first filing a copy of the = advertisement=20 or prospectus in the office of the Regulatory Authority. The bill = also has=20 provisions for

a. =20 Responsibility=20 of the Promoter to enter all record or details on the website of = the=20 Regulator;

b. =20 Responsibility=20 of promoters regarding veracity of the advertisement or=20 prospectus;

c. =20 No=20 deposit or advance to be taken by promoter without first entering = into an=20 agreement of sale;

d. =20 Responsibility=20 of Promoter to take measure for protection and safety of=20 property;

e. =20 Responsibility=20 of the Promoter regarding the account of sums taken from or on = behalf of=20 the allottees;

f. =20 Responsibility=20 of the promoter to the allottees during project period=20 etc.

Comments/suggestions=20 on the draft bill have been invited from public and other = stakeholders by=20 06.11.2009 through issue of public notice, as also through = communications=20 to States/UTs, business chambers etc. So far comments from 77 = stakeholders=20 have been received. However, States/UTs have not responded in the = matter=20 and being reminded.

Integrated=20 Low Cost Sanitation (ILCS) Scheme

The=20 "Integrated Low Cost Sanitation" Scheme aims at conversion of = individual=20 dry latrine into pour flush latrine thereby liberating manual = scavengers=20 from the age old, obnoxious practice of manually carrying night = soil.=20

ILCS=20 scheme was initially started in 1980-81 through the Ministry of = Home=20 Affairs and later through Ministry of Social Justice & = Empowerment.=20 The scheme was transferred in 1989-90 to Ministry of Urban = Development=20 & Poverty Alleviation and from 2003-2004 onwards to Ministry = of=20 UEPA/HUPA. The scheme has helped in constructing/converting over = 28 lakh=20 latrines to liberate over 60000 scavengers so far. While = implementing the=20 ILCS scheme, it was observed that the scheme did not perform well = due to=20 various reasons. To make the scheme more attractive and = implementable the=20 Guidelines have been revised w.e.f. 17th January,=20 2008.

The=20 main objective of the Scheme is to convert low cost sanitation = units=20 through sanitary two pit pour flush latrines with superstructures = and=20 appropriate variations to suit local conditions (area specific = latrines),=20 but 25% of the funds of the scheme are also made available for=20 construction of new latrines where EWS households have no = latrines. Under=20 the Scheme, central subsidy is 75%, State Subsidy 15% and = beneficiary=20 share is 10%. The upper ceiling cost is Rs.10,000/- for the = complete unit.=20 For the States falling in the category of difficult and hilly = areas, 25%=20 extra cost is provided. 2009-10 is aimed to be the last year of = the=20 scheme. =20

Within=20 the last one year, States of Andhra Pradesh, West Bengal, Nagaland = and=20 Assam have stated that they have no dry latrines in their states.=20 Presently only four States remain in the country who need to = address this=20 issue namely, Bihar, Uttarakhand, J&K and UP. Under the = revised=20 guidelines of ILCS, a total of 2,49,534 units for conversion and = 36,396=20 units for construction have been sanctioned so = far.

Revised=20 Swarna Jayanti Shahari Rozgar Yojana

With=20 a view to provide gainful employment to the urban unemployed and=20 underemployed through encouraging the setting up of = self-employment=20 ventures or provision of wage employment and skill development, = Swarna=20 Jayanti Shahari Rozgar Yojana (SJSRY), in implementation from = 01.12.1997,=20 has been comprehensively revamped. The new scheme has commenced = from=20 2009-2010. SJSRY will have five major components, namely-=20

(i) =20 Urban Self Employment Programme = (USEP)

(ii) =20 Urban Women Self-help Programme = (UWSP)

(iii) =20 Skill Training for Employment Promotion amongst Urban Poor=20 (STEP-UP)

(iv) =20 Urban Wage Employment Programme = (UWEP)

(v) =20 Urban Community Development Network = (UCDN)

The=20 following major changes have been effected in the=20 scheme:

(i) =20 For the beneficiary under the Urban Self Employment = Programme=20 (USEP) component of the Scheme, the education limit criteria of = =93not=20 educated beyond 9th standard=94 has been removed and now no = minimum or=20 maximum educational qualification level has been prescribed for = the=20 purpose of eligibility of assistance.

(ii) =20 For the self-employment (individual category), the project = cost=20 ceiling has been enhanced to Rs. 2.00 Lakhs from the existing Rs. = 50000/-=20 and the subsidy has also been enhanced to 25% of the project cost = (subject=20 to a maximum of Rs. 50000/-), from the existing 15% of the project = cost=20 (subject to a maximum of Rs. 7500/-).

(iii) =20 For the group enterprises set up by urban poor women, the = subsidy=20 has been made as 35% of the project cost or Rs. 300,000/- or Rs. = 60,000/-=20 per member of the Group, whichever is less. The minimum number = required to=20 form a women group has been reduced from 10 to 5. The revolving = fund=20 entitlement per member has also been enhanced from the existing = Rs. 1000/-=20 to Rs. 2000/-.

(iv) = The=20 Skill Training of the urban poor component has been restructured = and=20 quality skill training will be provided to the urban poor linking = it with=20 certification, imparted preferably on Public-Private Partnership=20 (PPP)=20 mode, with the involvement of reputed institutions like IITs, = NITs,=20 Poly-techniques, ITIs, other reputed agencies etc. The average = expenditure=20 ceiling per trainee has been enhanced from the Rs. 2600/- to Rs.=20 10000/-.

Central Allocation under = SJSRY has=20 been enhanced to Rs 515 Crores in 2009-10.

National=20 Policy on Urban Street Vendors (2009) and Draft Model Bill = 'The=20 Street Vendors (Protection of Livelihood and Regulation of Street = Vending)=20 Bill, 2009

Street=20 vendors constitute an integral part of our urban economy. With a = view to=20 give recognition to urban street vendors for their contribution to = the=20 society and also to strengthen urban poverty alleviation = initiatives in=20 terms of creation of conditions for decent work, the Government of = India=20 has revised Street Vendors=92 Policy 2004 comprehensively and has = developed=20 a model law for street vendors to enable them carry out their = trade=20 without harassment from public officials. The new policy suggests = that the=20 City/Town Master Plans/Zonal Plans/Local Area Plans must reserve = adequate=20 space for the street vendors including vendors=92 markets. It also = calls for=20 registration and issue of identity cards to street vendors. = Further, Town=20 Vending Committee (TVC), with 40% of the members being street = vendors=20 themselves, is to be constituted in all cities/towns and wards (if = considered necessary) to discharge the following=20 functions:

o =20 undertaking=20 periodic surveys

o =20 registration=20 and issuance of Identity Cards

o =20 monitoring=20 vending activities

o =20 Assessing=20 and determining maximum holding capacity of each vending zone, = etc.=20

Cities/towns=20 are required to make demarcation of 'Restriction Free Vending = Zones',=20 'Restricted Vending Zones' and 'No-vending Zones' depending upon = the=20 ground realities. The new policy recommends the conduct of = comprehensive,=20 digitized photographic surveys of street vendors and their = locations by=20 competent professional institutions/agencies and maintenance of=20 computerized information systems. The new policy envisages the = enactment=20 of law to facilitate street vending and accordingly, a model law = has been=20 circulated to State Governments.

Background

AD/DB