 "Oni village, Tehri, Uttarakhand")
One of the main promises of the Narendra Modi government in its third term is to construct 20 million new houses for the rural poor.
After taking charge earlier this month, the new government gave ‘in-principle’ approval for the proposal in its first Cabinet meeting.
The houses will be built over the next five years, averaging 4 million homes per year starting from FY25.
One of the main criteria that will separate the new homes in rural India from the ones that have been already constructed is the increased per-unit funding allocated for construction.
In the FY25 interim Budget, the Central government promised Rs 2,00,000 for each rural house built in the plains under the Pradhan Mantri Awas Yojana-Gramin (PMAY-G), up from the previous Rs 1,20,000, an increase of nearly 67 per cent.
The budget documents also showed that for houses that will be built in hilly and northeastern states, the per-unit allocation has been increased to Rs 2,20,000 from Rs 1,30,000, an increase of 69 per cent.
This increase in funding addresses the long-standing demand to accommodate the rising costs of materials like cement and bricks.
To build the additional 20 million houses, a tentative financial provision of around Rs 4,18,200 crore at the rate of Rs 205,000 per unit has been made over the next five years. Of this, the Central share will be 63 per cent, or around Rs 2,63,466 crore, with the rest covered by the states.
“The Central budget estimate for PMAY-G for FY-24-25 is Rs 54,500 crore,” the budget documents show.
The total budgetary provision for FY25, including the state’s share, is Rs 80,671 crore for rural houses.
The Centre’s budgetary share also includes subsidies on interest for loans taken from NABARD for rural housing.
According to the scheme’s guidelines, the financial burden of implementation is shared by the Centre and states in a ratio of 60:40 for plain areas and 90:10 for hilly and special category states.
Under the Pradhan Mantri Janjati Adivasi Nyaya Maha Abhiyan (PM-JANMAN), a scheme for the development and welfare of the most vulnerable tribal communities starting from 2023-24, a dedicated provision of Rs 630.05 crore in RE 2023-24 and Rs 3434.96 crore in BE 2024-25 has been made as the central share of funds for effective implementation of PM-JANMAN under the rural housing scheme.
Rural houses are also eligible for subsidised labour through convergence with MGNREGA, cheap gas connections under the Pradhan Mantri Ujjwala Yojana, toilets under the Swachh Bharat Mission, and water connections under the Nal Se Jal Scheme.
A 2018 analysis of the scheme by the National Institute of Rural Development and Panchayati Raj in Hyderabad, conducted in Madhya Pradesh, Odisha, and West Bengal, found that PMAY-G beneficiaries experienced significant improvements in subjective well-being (socio-psychological well-being), including social status, self-worth, confidence, sense of ownership, safety and security, perceived health improvements, overall quality of life, and satisfaction with their new homes, compared to a Comparison Group.
“It can be concluded that the new PMAY-G has made a significant impact on the lives of beneficiaries – both in terms of physical facilities provided and subject well-being. Policy issues about PMAY convergence with other programmes require major changes,” the study found.
However, the study also found that convergence with other programs, except for Swachh Bharat Mission-Gramin and MGNREGS, has not progressed much.
Since 2014-15, the Narendra Modi government has aimed to build around 29.5 million houses to provide ‘Housing for All.’
According to Budget papers, around 29.4 million houses have been allocated, and about 26.24 million rural houses have already been built.
“The program is the first of its kind where genuine beneficiaries are identified based on housing deprivation parameters as per SECC-2011, followed by verification at the Gram Sabha level and geo-tagging of the beneficiaries to confirm their authenticity,” the Budget documents showed.
Among the major states, Uttar Pradesh, Bihar, and Rajasthan have performed remarkably well, achieving nearly 99.03 per cent, 98.76 per cent, and 98.57 per cent of their targets, respectively.
Poor performers include Andhra Pradesh, with only 31.14 per cent of the target achieved, and Daman and Diu, with just 10.13 per cent of the target completed since 2016-17.
With rural India giving a thumbs down to the ruling BJP government in the just concluded General Elections, faster and smoother completion of the rural houses could be a big image booster.
An analysis by CSDS and Lokniti indicated that the BJP and its allies lost vote share in rural areas, while Congress and its allies gained, highlighting the importance of effectively addressing rural concerns.
