New home loan interest subvention plan to be announced in Sept

A new loan interest subvention scheme for homebuyers in cities would be finalised and announced in September, Union Housing and Urban Affairs (MoHUA) Minister Hardeep Singh Puri said on Thursday.

Asked about the details of the scheme mentioned by Prime Minister Narendra Modi in his Independence Day address, Puri said at a press conference: “The scheme will be announced in full detail in September. It’s going to be supplementing what we have already.”

Speaking from the ramparts of the Red Fort on August 15, the Prime Minister had said: “The weaker sections living in the cities face a lot of problems. Middle-class families are dreaming of buying their own houses. We are coming up with a new scheme in the coming years that will benefit those families that live in cities but are living in rented houses, slums, chawls, and unauthorised colonies. If they want to build their own houses, we will assist them with relief in interest rates and loans from banks that will help them save lakhs of rupees.”

The scheme would be over and above the existing Pradhan Mantri Awas Yojana-Urban, under which 1.18 crore houses have been sanctioned. Puri said when PMAY-U was started, the demand assessment was done by states and verified by the MoHUA before setting the target of 1 crore houses. Since then, the demand has been increased on the request of the states.

Puri said there were “gaps” as some people wanted assistance under one of the components of PMAY-U, the Affordable Housing in Partnership (AHP), but could not fulfil the requirements and asked for it to be converted into another component, the Beneficiary-Led Construction (BLC). He said the ministers of the states that were performing well under PMAY-U had asked him to allocate the additional units to their states as they had the demand. The new scheme was in the “final stages” of being worked out, he said.

As of Thursday, 76.45 lakh houses have been completed. Three components of the scheme — AHP, BLC and In-situ Slum Redevelopment — were extended till December 31, 2024, but one of the components, Credit-Linked Subsidy Scheme, which gave beneficiaries interest subsidy on home loans was not extended beyond the deadline of March 2022.

Meanwhile, Housing and Urban Affairs Secretary Manoj Joshi said at the press conference that 10,000 electric buses would start to be deployed in cities in around five months’ time. Under the PM e-Bus Seva scheme, that was approved by the Cabinet in August, the Ministry would give bus operators Rs 20 to Rs 24 per km as support, he said.

Puri said the ministry had adopted a model of boosting last-mile connectivity involving the bus operators, the state government and the Union government, but “those [state governments] in the game of distributing revadis, they would not be able to do it”.