Making Housing Affordable for Urban Poor- Approaches Adopted in India

1.0 Backgraound

Housing is one of the basic necessity of an individual. However, the dream of having a house remains distinct for than one-third urban population. They remain marginalised in terms of civic services, housing and other socio-economic parameters. The cost of this marginalisation is often very high and many studies have shown that it may be upto 2-5 times of the formal system.

 By 2030, an estimated 5 billion of the world's 8.1 billion people will live in cities. About 2 billion of them will live in slums, primarily in Africa and Asia, lacking basic services, unsecured tenure, congestion and surrounded by desperation and crime. In India, the urban housing shortage has been estimated as 18.78 million, of which almost 96 per cent pertains to urban poor. Affordable housing has been considered as the only option to meet this challenge. A Task Force on "Affordable Housing for All", constitute by the Government of India, Ministry of Housing and Urban Poverty Alleviation, defined affordable housing in terms of (a) multiples of household income; (b) size of the tenement; and (c) percentage of household income, in case of rented accommodation.

 3.0 Approach of this Paper

This paper will address the following issues, in the perspective of earlier discussions:

1. The need for a multi-pronged strategy for housing delivery to all sections of the society. This includes housing delivery system, target group and housing typology.
2. Incentives and subsidies to make housing within the reach of target group and mechanisms to retain the ownership. Right policy instruments for subsidy transfer are needed to make people shop for their dream house, without any restraint on size or location.
3. The access of urban poor to sources of institutional lending.