Highlighting urban development as one of the nine priorities of Budget 2024-2025, Finance Minister Nirmala Sitharaman on Tuesday announced the Pradhan Mantri Awas Yojana-Urban 2.0, with Rs 2.2 lakh crore central assistance over five years, to construct one crore additional houses.
“Under the PM Awas Yojana Urban 2.0, housing needs of one crore urban poor and middle-class families will be addressed with an investment of Rs 10 lakh crore. This will include the central assistance of Rs 2.2 lakh crore in the next five years. A provision of interest subsidy to facilitate loans at affordable rates is also envisaged. In addition, enabling policies and regulations for efficient and transparent rental housing markets with enhanced availability will also be put in place,” the minister said.
The cabinet last month approved three crore additional houses—two crore in rural areas and one crore in urban areas—in its first meeting in the third term of Prime Minister Narendra Modi’s Government.
With the PMAY-U coming to an end on December 31, the Budget made a provision of Rs 30,170.61 crore for it. This would include funding for PMAY-U 2.0, sources said. The amount included Rs 3,000 crore for the credit-linked subsidy scheme (CLSS) for the economically weaker sections (EWS) or Lower Income Group, Rs 1,000 crore for CLSS for Middle Income Group and Rs 500 crore for the Credit Risk Guarantee Fund Trust, which is a restructuring of an earlier scheme that will help informal sector workers who apply for home loans to get a credit guarantee.
The details of the scheme, including the income criteria for applicants of different categories, were still being finalised, sources said. Launching the scheme is on the ministry’s agenda for the first 100 days of the Modi government’s third term, it is learnt.
In her speech, the finance minister said the government would work with states to turn cities into “growth hubs” through transit planning and orderly planning of peri-urban areas.
“For creative brownfield redevelopment of existing cities with a transformative impact, our government will formulate a framework for enabling policies, market-based mechanisms and regulation. Transit-oriented development plans for 14 large cities with a population above 30 lakh will be formulated, along with an implementation and financing strategy,” Sitharaman said.
Sitharaman also announced water supply, sewage treatment and solid waste management projects for 100 large cities in partnership with state governments and multilateral development banks. Building on the success of the PM Svanidhi scheme, the government will come up with a scheme for development of 100 weekly haats or street food hubs in select cities in five years, she said. The allocation for the PM Svanidhi scheme, which gives street vendors working capital loans, was reduced from Rs 468 crore in Budget 2023-2024 to Rs 326.32 crore.
Overall, the Ministry of Housing and Urban Affairs’ budget was increased by 8 per cent from Rs 76,431.60 crore in Budget 2023-2024 to Rs 82,576.57 crore in 2024-2025. In the last financial year, the ministry’s revised estimate was reduced to Rs 69,270.72 crore.
The Budget also allocated Rs 1,000 for setting up centres of excellence in urban planning or design, which was announced in Budget 2022-2023, and Rs 1,300 for the PM e-Bus Sewa, which was launched in 2023 to help cities procure electric buses.
The finance minister also announced that land records in urban areas would be digitised using GIS mapping, which was a manifesto promise of the BJP for the 2024 Lok Sabha elections.
“An IT-based system for property record administration, updating, and tax administration will be established. These will also facilitate improving the financial position of urban local bodies,” she said.
For metro projects across the country, the Budget allocated Rs 24,931.98 crore, a slight increase from Rs 23,175.01 crore in 2023-2024. The ministry also got Rs 2,600 crore for non-residential general pool accommodation, which covers construction of the Central Vista project.
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