Housing policy

Housing Policy:
Initiative of the Government of India.
Objectives:
1. To provide shelter for the homeless.
2. To Improve the housing conditions for the inadequately housed.
3. To provide a minimum level of basic services and amenities to all.
The role of Government:
4. As a provider for the poorest and vulnerable sections
5. As a facilitator for other income groups and private sector by the removal of constraints and the increased
supply of land and services.
• First National Housing Policy in India formulated in 1988.
• With a change of Government in 1990, a new National Housing Policy was announced in August, 1994.
• Further, The National Housing & Habitat Policy was announced in July, 1998
• Initiated policies with the involvement of multi-stakeholders, permitting Foreign Direct Investment in housing and real
estate sector, etc.
• Most of the policies initiated were generic and applicable to both rural and urban areas.
• Taking into account emerging challenges of required shelter and growth of slums, the first ever urban areas specific
National Urban Housing and Habitat Policy, 2007 was announced in December 2007
History of Five Year Plans :

• The Idea of Planning as a process of rebuilding the economy gained prominence in the 1940s-50s.
• Various Industrialists came together in 1944 and drafted a joint proposal for setting up a planned economy in India.
It is famously known as the Bombay Plan.
• Planning for development was seen as a crucial choice for the country, following Independence.
• Joseph Stalin was the first person to implement the Five-Year Plan in the Soviet Union, in the year 1928.
• India launched a series of Five-Year Plans after independence to build its economy and attain development.

Concept of FYPs :

• The idea of five-year plans is simple- The Government of India prepares a document with all its income and
expenditure for five years.
• The budget of the central government and all the state governments is divided into two parts:
non-plan budget and plan budget.
• The non-plan budget is spent on routine items yearly. The planned budget is spent on a five-year basis as per the
priorities fixed by the plan.
• The model of the Indian Economy was premised on the concept of planning based on five-year plans from 1951-
2017.
• The Five Year Plans were formulated, implemented and regulated by a body known as the Planning Commission.
• The Planning Commission was replaced by a think tank called NITI AAYOG in 2015.
• The Niti Aayog has come out with three documents — 3-year action agenda, 7-year medium-term strategy
paper and 15-year vision document.
  The First Five Year Plan laid the thrust of economic development in India.
 It was presented by the first Indian Prime Minister, Jawaharlal Nehru to the Parliament of India.
 K.N Raj, a young economist, argued that India should "hasten slowly" for the first two decades.
First Five-Year Plan  It mainly addressed the agrarian sector, including investment in dams and irrigation. Ex- Huge allocations
(1951-56) were made for Bhakhra Nangal Dam.
 It was based on the Harrod Domar Model and emphasised increasing savings.
 By the end of 1956, five Indian Institutes of Technology were established.
 The target growth rate was 2.1% and the achieved growth rate was 3.6%.

 The Second Five year Plan stressed rapid industrialisation and the public sector.
 It was drafted and planned under the leadership of P.C Mahalanobis.
Second Five Year Plan
 It emphasised quick structural transformation.
(1956-61)
 The government imposed tariffs on imports to protect domestic industries under this plan.
 The target growth rate was 4.5% and the actual growth rate was slightly less than expected, 4.27%.

 The focus was on agriculture and improvement in the production of wheat.

 States were entrusted with additional development responsibilities. Ex- States were made responsible for
secondary and higher education.
Third Five Year Plan  Panchayat elections were introduced to bring democracy to the grassroots level.
(1961-66)
 The target growth rate was 5.6% and the actual growth rate only achieved 2.4%
 This indicated a miserable failure of the Third Plan, and the government had to declare "Plan
Holidays" (1966-67, 1967-68, and 1968-69). The Sino-Indian War and the Indo-Pak War, which caused the
Third Five Year Plan to fail, were the primary causes of the plan holidays.
  It was introduced under the Prime Ministership of Indira Gandhi and attempted to correct the previous
failures.
 Based on Gadgil Formula, a great deal of emphasis was laid on growth with stability and progress towards
Fourth Five-Year Plan: self-reliance.
(1969-74)
 The government nationalised 14 major Indian Banks and the Green Revolution boosted agriculture.
 The Drought Prone Area Programme was also launched.
 The target growth rate was 5.6%, but the actual growth rate was 3.3%.

 It laid stress on increasing employment and poverty alleviation (garibi hatao).

 In 1975, the Electricity Supply Act was amended, enabling the central government to enter into power
generation and transmission.

Fifth Five-Year Plan  The Indian National Highway System was introduced.
(1974-78)  The Minimum Needs Programme introduced in the first year of this plan, aimed to provide basic minimum
needs. MNP was prepared by D.P. Dhar.
 The target growth rate was 4.4% and the actual growth rate turned out to be 4.8%
 In 1978, the newly elected Morarji Desai government rejected this plan.

Rolling Plan (1978-80)

This was a period of instability. The Janata Party government rejected the fifth five-year Plan and introduced a new
Sixth Five-Year Plan. This, in turn, was rejected by the Indian National Congress in 1980 upon Indira Gandhi's re-
election.
A rolling plan is one in which the effectiveness of the plan is evaluated annually and a new plan is created the
following year based on this evaluation. As a result, throughout this plan, both the allocation and the targets are
updated.
  It underlined the beginning of economic liberation by eliminating price controls.
 It was seen as the end of Nehruvian Socialism.
Sixth Five Year Plan  To prevent overpopulation, family planning was introduced.
(1980-85)
 On the recommendation of the Shivaraman Committee,
the National Bank for Agriculture and Rural Development was established.
 The target growth rate was 5.2% and the actual growth rate was 5.7%, implying that it was a success.

 This plan was led by the Prime Ministership of Rajiv Gandhi.

 It laid stress on improving Industrial productivity levels through the use of technology.
 Other objectives included increasing economic productivity, increasing the production of food grains and
generating employment by providing Social Justice.
Seventh Five Year Plan  The outcome of the Sixth Five-Year Plan provided a robust base for the success of the seventh five-year
(1985-90) plan.
 It emphasised anti-poverty programmes, the use of modern technology, and the need to make India an
independent economy.
 It focused on attaining prerequisites for self-sustained growth by 2000.
 The target growth rate was 5.0%. However, the actual growth rate grew to reach 6.01%

Annual Plans (1990-92)

The Eight Five Year Plan was not introduced in 1990 and the following years 1990-91 and 1991-92 were treated as
Annual Plans. This was largely because of the economic instability. India faced a crisis of foreign exchange reserves
during this time. Liberalisation, Privatisation, Globalisation (LPG) was introduced in India to grapple with the
problem of the economy under prime minister P.V Narasimha Rao.
  The Eighth Plan promoted the modernisation of Industries.
 India became a member of the World Trade Organisation on 1 January 1995.
Eighth Five Year Plan  The goals were to control population growth, reduce poverty, generate employment, strengthen the
(1992-97) development of infrastructure, manage tourism, focus on human resource development etc.
 It also laid emphasis on involving the Panchayats and Nagar Palikas through decentralisation.
 The target growth rate was 5.6% but the actual growth rate was an incredible 6.8%.

 It marked India's fifty years since Independence and Atal Bihari Vajpayee led the prime ministership.
 It offered support for social spheres to achieve complete elimination of poverty and witnessed the joint
efforts of public and private sectors in guaranteeing economic development.
 The focus was also to balance the relationship between rapid growth and the quality of life for the
Ninth Five Year Plan people.
(1997-2002)  The objectives, further included, empowering socially disadvantaged classes, developing self-reliance and
primary education for all children in the country.
 Strategies included enhancing the high rate of export to gain self-reliance, efficient use of scarce resources
for rapid growth etc.
 The target growth rate was estimated at 7.1% but its actual growth rate fell shorter to 6.8%

 The features of this plan were to promote inclusive growth and equitable development.
 It intended for an 8% GDP growth per year.
Tenth Five Year Plan  It aimed at reducing the poverty by half and creating employment for 80million people. Further, it aimed
(2002-07) to reduce regional inequalities.
 It also emphasised reducing the gender gaps in the field of education and wage rates by 2007.
 The target growth rate was 8.1% while the actual growth was 7.6%.
  The Eleventh Plan was significant in its aim to increase enrolment in higher education and focused on
distant education as well as IT institutes. Ex: The Right to Education Act was introduced in 2009, and came
into effect in 2010, making education free and compulsory for children aged between 6-14 years.
 Its main theme was rapid and more inclusive growth.
Eleventh Five Year Plan
(2007-2012)  It is aimed at environmental sustainability and reduction in gender inequality.
 C.Rangarajan prepared the Eleventh Five Year Plan.
 The focus was also laid on providing clean drinking water for all by 2009.
 The target rate was 9% and the actual growth rate was 8%.

 The last Five Year Plan had "Faster, More Inclusive and Sustainable Growth" as its theme.
 The plan aimed at strengthening infrastructure projects, and providing electricity supply in all villages.
 It also aimed at removing the gender and social gap in admissions at school and improved access to higher
Twelfth Five Year Plan education.
(2012-17)
 Further, it aspired to enhance the green cover by 1 million hectares each year and to create new
opportunities in the non-farming sector.
 The target growth rate was 9% but in 2012, National Development Council approved a growth rate of 8%
for this twelfth plan.
URBANIZATION :

• The process of urbanization is marked by a concentrated increase in the population

of larger cities.
• The provision of urban infrastructure in Indian cities is lagging far behind the pace
of urbanization.
• The growth of the Indian workforce is also characterized by an increasing level of
urbanization.
• There is a huge gap in the availability and requirements of funds for urban
infrastructure development
• The pressure of urban population and lack of housing and basic services were very
much evident in the early 1950s.
• The positive aspects of cities as engines of economic growth in the context of national
economic policies were not much appreciated.
• Thus, the problems of urban areas were treated more as welfare problems and
sectors of residual investment than as issues of national economic importance.

GROWTH OF SLUMS
URBANIZATION POLICY:
This policy intends to promote sustainable development of habitat in the city with a view to ensuring equitable
supply of land, shelter and services at affordable prices to all sections of society. The policy places special emphasis
on urban poor namely EWS and slum dwellers.
Sustainable Development:
The policy emphasizes the importance of developing urban areas in a way that is
environmentally, socially, and economically sustainable.
Equitable Access:
It strives to provide equal opportunities for all citizens to access land, housing, and
essential services like water, sanitation, and transportation.
Affordable Housing:
A key focus is on making housing affordable for all income groups, especially the
urban poor and those living in informal settlements.
Urban Poor Focus:
The policy specifically highlights the need to address the housing and living
conditions of the urban poor, including those in Economically Weaker Sections (EWS)
and slums.
Land, Shelter, and Services:
The policy covers the entire spectrum of urban needs, from land acquisition and
development to the provision of shelter (housing) and essential services.
The policies of urban development and housing in India have come a long way since 1950s.

 Formulation of National Urban Housing & Habitat Policy 2007.

 Jawaharlal Nehru National Urban Renewal Mission.
 Interest Subsidy Scheme for Housing the Urban Poor.
 Affordable Housing in Partnership : Modification in JNNURM
 Setting up of a High Power Task Force on Affordable Housing.
 Launch of the Rajiv Awas Yojana.
National Urban Housing and Habitat Policy 2007 (NUHHP) :

It was formulated keeping in view the changing socio-economic parameters of the urban
areas and growing requirement of shelter and related infrastructure.
• The Policy promotes various types of public-private partnerships for realizing the goal of
“Affordable Housing for All” with special emphasis on the urban poor.
• The NUHHP-2007 focuses the spotlight on multiple stakeholders namely,
• The Private Sector,
• The Cooperative Sector,
• The Industrial Sector for labor housing
• The Services/ Institutional Sector for employee housing.

Housing scenario of India

Salient features of NUHHP:

 Goal of the Policy is Affordable Housing for All with special emphasis on the urban poor.
 Strategy framework is multiple partnership of States with various stakeholders, cooperatives, employee welfare
housing organizations, private sector, state parastals.
 Special emphasis has been laid on SC/ST/BC/Minorities, empowerment of women within the ambit of the urban
poor with emphasis on security of tenure.
Jawaharlal Nehru National Urban Mission (JNNURM) :

JNNURM was launched in December 2005 with aim to cover construction of 1.5 m houses for urban poor during the
Mission period (2005- 2012).
It has two Sub-Missions :
 Basic Services for the Urban Poor (BSUP) seeks to provide seven entitlements/services – in low income segments in
the 65 Mission Cities.
 The Integrated Housing and Slum Development Programme (IHSDP) seeks to provide the above mentioned 7
entitlements, services in towns/cities other than the Mission Cities.
Under JNNURM, more than 1.5 million houses have been sanctioned for the poor About 1300 projects have been
sanctioned covering urban India These projects involve an outlay of more than Rs.33,860 crore and Central Govt.
subsidy of Rs.18,500 crore.
• Health
• Education
• Water
• Sanitation
• Social security
• Security of tenure
• Affordable housing
Interest Subsidy Scheme for Urban Poor :
• A new Pilot Scheme for providing interest subsidy on housing loans availed by EWS/LIG for
acquisition/construction of houses
• Encourages poor sections to avail of loan facilities through Banks.
• Subsidy will be 5% on the interest charge for EWS/LIG upto Rs.1 lakh for the full period of the loan
• Loan repayment period permissible from 15 to 20 years.
• Levy of pre-payment charges would not be permitted.
• Targets to cover 0.31 million households under EWS/LIG segments
• Total subsidy during 11th Five Year Plan Rs.1100 crore.
Affordable Housing in Partnership : Modification in JNNURM

• Modification in the guidelines of JNNURM (BSUP) to facilitate and incentivize land assembly for affordable
housing.
• Provision of central assistance of 25% for the cost of the provision of civic services for projects for affordable
housing at an approximate cost of Rs.5000 crore.
• The objective of the scheme would be to support the construction of 1 million affordable dwelling units in the first
phase, with a minimum of 0.25 million EWS dwelling units.
• Disbursement of funds linked to the actual provision of amenities. A normative cap per EWS/LIG dwelling unit to
be fixed in consultation with the States for the purpose
Affordable Housing in Partnership :
Modification in JNNURM Contd.