FM Sitharaman Announces New Housing Scheme for Middle Class

Finance Minister Nirmala Sitharaman announced a new housing scheme for the middle class in the Interim Budget 2024. The scheme will offer affordable rental houses to urban poor and migrant workers under the Pradhan Mantri Awas Yojana (PMAY) scheme. The announcement comes ahead of the General Elections 2024, which are expected to be held in April-May.

Affordable Rental Housing Scheme

The affordable rental housing scheme will provide rental houses to migrant workers and urban poor who face difficulties in finding accommodation in cities. The scheme will be implemented through a public-private partnership model, where existing government-funded housing complexes will be converted into affordable rental housing complexes (ARHCs). The government will also incentivize private and public entities to develop, operate and maintain ARHCs on their own vacant land.

The scheme aims to address the housing needs of the urban poor and migrant workers, who have been severely affected by the COVID-19 pandemic and the subsequent lockdowns. The scheme will also boost the demand for construction materials and create employment opportunities in the sector.

Credit Linked Subsidy Scheme Extension

The finance minister also announced the extension of the Credit Linked Subsidy Scheme (CLSS) for the middle income group (MIG) till March 2021. The CLSS provides an interest subsidy of up to 2.67 lakh rupees on home loans taken by eligible beneficiaries under PMAY. The scheme covers annual income groups of 6 lakh to 18 lakh rupees.

The extension of the CLSS will benefit 2.5 lakh middle income families during 2020-21 and will lead to an investment of over 70,000 crore rupees in the housing sector. The scheme will also stimulate the demand for affordable housing and support the recovery of the real estate sector, which has been hit hard by the pandemic.

Impact on Middle Class

The new housing scheme and the CLSS extension are expected to have a positive impact on the middle class, who have been facing challenges due to inflation, low income growth and high tax burden. The schemes will provide relief to the salaried class by increasing their disposable income and enhancing their quality of life. The schemes will also encourage home ownership and promote social inclusion among the urban poor and migrant workers.

The finance minister said that the government is committed to providing “Housing for All” by 2022, which is one of the key goals of PMAY. She said that the government has already sanctioned over 1.1 crore houses under PMAY, out of which more than 70 lakh houses have been grounded and more than 41 lakh houses have been completed.