While the government had introduced the Pradhan Mantri Awas Yojana (PMAY) with much fanfare, it seems the scheme is now unaffordable for the poor and low-income group.
Builders are re-labelling their projects as affordable housing under PMAY with the earlier price tag, although these projects are also available outside the umbrella of the scheme. In some cases, they are charging high rates even for 30-square-metre and 60-square-metre units. The scheme has ended up providing only interest subsidy to buyers. Builders are asking for five per cent to 10 per cent down payment and no EMI until possession. These are the same terms and conditions under which flats are available outside PMAY.
This means builders will make hefty profits under PMAY. There is no price cap or checkmate, builders are not passing the zero-tax exemption on profits earned under the scheme to buyers. Likewise, associated benefits under infrastructure status for PMAY are also not being passed to customers.
The government should immediately plug loopholes in the scheme by imposing a price cap and also define the facilities that are supposed to be available in affordable housing units. It should set the conditions for construction, materials to be used and amenities to be provided in each unit and ensure compliance with the strictest building standards.
The government should ask builders to consider the possibility of converting unsold inventory into affordable 30-square-metre or 60-square-metre units and make them ready-to-move-in flats. Effort should be made to reduce cost and introduce deadlines for completion of these units.
If prices are high, how can the scheme be successful only with a small subsidy by way of an interest cut against a loan granted?
A Sathyanarayana New Delhi
Letters can be mailed, faxed or e-mailed to:
The Editor, Business Standard
Nehru House, 4 Bahadur Shah Zafar Marg
New Delhi 110 002
Fax: (011) 23720201 · E-mail: letters@bsmail.in
All letters must have a postal address and telephone number
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%