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representative image BengaluruChief Minister’s burden of ‘unsold’ houses below Rs 1 lakh affordable housing Under the scheme, the government is exploring several options to reduce the burden on the government exchequer.
Recently in a meeting with the Chief Minister Siddaramaiah and his deputy DK Shivakumar, Boston Consulting Group (BCG), recommended that the government provide interest subsidy of up to 5% for beneficiaries and/or explore the possibility of allowing private developers to build houses at their own cost, with the government subsidizing 50%. Provide 70% land. ,
The data shows that the government is in the process of building 45,000 houses at a cost of Rs 11.2 lakh per house. Under the Pradhan Mantri Awaaz Yojana, a beneficiary will have to pay Rs 7.7 to 8.5 lakh, while the government bears the rest of the cost.PMAY) and other schemes. But the government is stuck with a burden of Rs 3,700 crore as it struggles to pay such huge amounts to beneficiaries.
Low CIBIL score is the biggest reason for beneficiaries to struggle to raise funds. As a result banks and financial institutions are providing loans at higher interest rates between 11% to 12% for a tenure of 10-15 years. To reduce this concern, a proposal has been made to provide interest subsidy between 3% to 5%.
This would mean that the government would incur a small loss of between Rs 60 crore and Rs 170 crore per year, but the beneficiaries are more likely to purchase these houses. Buyers will have to deposit Rs 50,000 in advance as an assurance to raise the loan and pay the balance amount.
The second proposal is to go back to the public-private partnership (PPP) model, which seeks to set aside 70% of government land, which will be allotted or acquired by private developers in exchange for building houses. Once completed, these units will be handed over to the government for distribution.
Private developers can monetize land by building residential or commercial properties.
It is said that such PPP model has already been implemented in Gujarat, Rajasthan and Odisha.
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