NATIONAL HOUSING POLICY (NHP)

Introduction

Formulating a housing policy formed a crucial part of planning process in India as early as 1948. When the
National Planning Commission was constituted, a subcommittee for housing was also appointed to examine
the various aspects of housing problems in India. But it was only in 1980s some serious thinking began on
the formulation of National policy in Housing.

Global Shelter Strategy adopted by the UN in November 1988 calls upon different governments to take
steps for the formulation of a National Housing Policy (NHP). The Ministry of Urban Development prepared
a draft NHP which was stabled in both houses of Parliament in 1988. This was subsequently revised in 1990.

Objectives

1. To assist all people particularly houseless to secure for themselves affordable shelter through access
to developed land, building materials, finance and technology.

2. To create an enabling environment for housing activity by eliminating constraints.

3. To expand infrastructure facilities in rural and urban area in order to improve the environment of
human settlement.

4. Increase the access of poorer households to basic services.

5. To increase the supply of developed land for housing.

6. To undertake within the overall context of policies for poverty alleviation and employment, steps for
elevating the housing situation of the poorest sections with the financial support of the state.

7. To help mobilise resources and facilitate expansion of investment in housing.

8. To promote a more equitable distribution of land and houses in urban and rural areas to curb
speculation and profiteer in land and housing.

Aims

1. Creation of surplus in housing either on rental or on ownership basis.

2. Providing quality and cost effective housing to poor and vulnerable sections.

3. Ensuring that housing with supporting services is treated as a priority.

4. Guiding urban and rural settlements so that there is planned and balanced growth.

5. Planning of urban transport is to be an integral part of urban master plan.

6. Development of cities with an increased use of renewable resources and pollution free
environment with a concern for solid waste disposal.

7. Using the housing sector to generated more employment and achieves skilled up gradation.

8. Ensuring that all dwelling units have easy accessibility to basic sanitation facilities and water.
 9. Removing legal, financial and administrative barriers for facilitating access to land, finance and
technology.

10. Progressive shift from a subsidy based housing to cost sharing housing.

11. Progressive shift of rural housing strategies for target orientation to a demand driven approach.

12. Giving powers to Panchayat Raj institutions and Village co-operatives to mobilize credit for adding
to housing stock, and basic amenities in rural area.

13. Building strong partnership between private, public and co-operative sectors to enhance the
capacity of construction industry.

14. Meeting the special needs of SC/ST/disable/slum dwellers.

15. Involving women at all levels of decision making and enabling them in the formulation and
implementation of housing policies and programmes.

16. Addressing the special needs of women headed households.

17. Protecting and promoting our cultural heritage, architecture and traditional schemes.

National Housing and Habitat Policy (1998)

A comprehensive housing and habitat policy had been formulated to address the issues of sustainable
development, infrastructure and for strong private-public partnership for shelter delivery. The objectives of
the policy are to create surplus in housing stock by creating an enabling environment and facilitate
construction of 20 lakh additional dwellings each year. It also seeks to ensure that housing along with
supporting services is treated as priority sector at par with infrastructure. The central theme of the policy is
strong public-private partnership for tackling housing and infrastructure problems. The document clearly
identifies the role of Central Government, State Government, Local Authorities, Financial Institutions,
Research Standardization and Technical Institutions.

o Public agencies would undertake land acquisition proceedings for housing and urban services.
Other feasible alternatives like land pooling would be encouraged with appropriate statutory
supports.
o Urban land use needs to be optimised.
o Town and country planning regulations is to be amended to provide for higher density needs.
o A portion of land should be provided at affordable rates for housing those who provide essential
services. This would help checking the growth of slums.
o Housing finance institute will take up the task of attractive resources from provident fund, insurance
fund etc.
o Incentives have to be provided for encouraging investments by financial institutions in rental
housing.
o A national shelter fund to be set up to meet the requirements of low cost funds for the housing
needs of the poor.
o Government would consider setting up a risk fund to under write or cover the risk in financing the
rural and urban poor. This would be built up by housing finance institutes by surrendering a part of
their profit.
o The private sector would be persuaded to invest a part of their profit for the housing needs of the
poor.
 o Investment from NRIs, overseas co-operate bodies would be encouraged in housing, real estate and
infrastructure sectors.

National Housing and Habitat Policy (2007)

Given the magnitude of the housing shortage and budgetary constraints of both the central and state
governments, the policy focuses on multiple stake-holders at the private sector, the cooperative sector, the
industrial sector for labour housing and the services and institutional sector for employee housing. Since
the policy was revised last time in 1998, there have been major changes in habitat and human settlement
issues. Particularly, the urban housing sector has been facing emerging challenges with regard to availability
of affordable shelter, growth of slums, and gaps in provision of basic services to the urban poor.

o The urban housing shortage has been estimated at about 24.7 million units at the end of the 10th
Five Year Plan (2006-07) of which 99 per cent of the shortage pertains to economically weaker
sections (EWS) and low income groups (LIG) categories.
o The role of housing and provision of basic services to the urban poor has been integrated into the
objectives of the Jawaharlal Nehru Urban Renewal Mission (JNNURM).

o It has laid special emphasis on Scheduled Castes, Scheduled Tribes, Backward Classes, Minorities
and empowerment of women within the ambit of the urban poor.

o The policy focuses on a symbiotic development of rural and urban areas in line with the objectives
of the 74th Constitution Amendment Act.

o Within the overreaching goal of Affordable Housing for All, emphasis has been laid on urban
planning, increase supply of land, use of spatial incentives like additional floor area ratio (FAR),
Transferable Development Rights, increased flow of funds, healthy environment, effective solid
waste management and use of renewal sources of energy.

o Encouraging integrated townships and special economic zones (SEZs), the policy called for
reservation of 10-15 per cent land in every new public and private housing project or 20-25 per cent
FAR whichever is greater to for EWS and LIG housing through appropriate spatial incentives.

o The policy sets action plans for urban slum dwellers and special package would be prepared for
cooperative housing, labour housing and employees housing.

o As per the policy, the states are also advised to develop 10 years perspective plan for housing of
EWS and LIG.

o The policy would give primacy to provision of shelter to urban poor at their present location or near
their work place. Approach will be in-situ slum rehabilitation and relocation will be considered only
in specific cases.

o The policy would promote micro finance institutions at state level to expedite flow of finances to
urban poor.

o It seeks the central government to prepare model municipal laws and to prepare detailed city maps
based on GIS, aerial survey and ground verification.

o The policy would encourage the use of proven cost effective technology and building materials. It
also envisaged the development of mass rapid transit system at sub-regional level.
 o To maintain the greener look of the cities, the national policy encouraged green cover by planting
trees and stop cutting it for balanced ecological development.

o As per the policy, all states would be encouraged to develop a Habitat Infrastructure Action Plan'
for all cities with a population of over one lakh.

o The action plan stated in the policy seeks the central government's encouragement and support in
preparing the State Urban Housing and Habitat Policy and Action Plan.

o The state and UT action plans would focus on accelerated flow of funds and provide road map for
institutional, legal and financial incentives.

o Periodic review of implementation of policy and action plan at state level to be carried out and
preparation of 15-20 years perspective plans in the form of city development plans (CDPs) based on
spatial planning at the city level.

o The action plan seeks for setting up of a High Level Monitoring Committee for periodic review and
implementation of the policy and for making amendments, modifications wherever considered
necessary.

HOUSING SCHEMES IN INDIA

State-wise Total Projects Sanctioned under Jawaharlal Nehru National Urban Renewal Mission (JNNURM) - Basic Services to Urban Poor
(Sub Mission II) in India (As on 09.02.2009)
Integrated Development of Small and Medium Towns (IDSMT) Scheme (1979-2008)

Two Million Housing Programme (1998-2008)

Category-wise Performance of Prime Lending Institutions under Golden Jubilee Rural Housing Finance Scheme in India (2003-2004 to 2006-
2007)
Integrated Low Cost Sanitation Scheme (ILCS) (2002-2007)
Loan/Dwelling Units Sanctioned for Economically Weaker Sanctions in India (1997-1998 to 2006-2007)

Refinance Disbursements of National Housing Bank (NHB) under Golden Jubilee Rural Housing Finance Scheme (GJRHFS) in India (1977-
1998 to 2005-2006)
Selected State-wise Housing Loans Disbursed and Units Constructed by Apex Cooperative Housing Federations (ACHFs) in India (2002-
2003 to 2005-2006)

Total Housing Finance Disbursement under Golden Jubilee Rural Housing Finance Scheme (GJRHFS) in India (2001-2002 to 2005-
2006)
State-wise Achievements by Banks under Golden Jubilee Rural Housing Scheme in India (2001-2002 to 2003-2004)
State-wise Financial Assistance for Construction of Individual Houses by Beedi Workers under Integrated Housing Scheme in India
(2002-2003 and 2003-2004)
Statewise Housing Loan and Dwelling Units Sanctioned under Economically weaker Section (Rural and
Urban) Category in India (2001-2002 to 2003-2004)
State-wise Status of Sanctions of Shelter and Sanitation Facilities for Footpath Dweller in Urban Areas of India (As on 13.10.2004)

Company-wise Interest Rates of Housing Finance Companies on Home Loan Schemes (As on 11.12.2003)
Selected State-wise Target and Achievement for Economically Weaker Section (EWS) Houses under 20 Point Programme in India
(September 2003)
Selected State-wise Target and Achievement for Low Income Group (LIG) Houses under 20 Point Programme in India (September 2003)

State/District-wise Status of Approved Rural Building Centres in India (1999-2000 to 2002-2003)

State-wise Status of Sanctions of Shelter and Sanitation Facilities for Footpath Dwellers in Urban Areas of India (2002-2003)
 Performance under Economically Weaker Sections Housing Scheme in India (1996-1997 to 2001-2002)

Performance under Low Income Group (LIG) Housing Scheme in India (1997-1998 to 2001-2002)

Social Housing Schemes in India (1952, 1954, 1956, 1957, 1959 and 1971)

VAMBAY

State-wise Housing and Urban Infrastructure Schemes Pending with HUDCO in India

o Housing and Urban Development Corporation Ltd. (HUDCO) (1971-2009)

o State-wise Total Projects Sanctioned under Jawaharlal Nehru National Urban

Renewal Mission (JNNURM) - Basic Services to Urban Poor (Sub Mission II) in
India (As on 09.02.2009)

o Integrated Development of Small and Medium Towns (IDSMT) Scheme (1979-

2008)

o Selected State-wise Number of Projects and Total Cost Approved for Urban
Poor (Sub Mission II) under Jawaharlal Nehru National Urban Renewal
Mission (JNNURM) in India (2005-2006 to 2007-2008)

o State-wise Number of Dwelling Units Approved for Basic Services to Urban

Poor (Sub Mission-II) under Jawaharlal Nehru National Urban Renewal
Mission (JNNURM) in India (2005-2006 to 2007-2008)
State-wise Total Projects Sanctioned under Jawaharlal Nehru National Urban Renewal Mission-Basic Services to Urban Poor (Sub-Mission-II)

in India (As on 02.04.2008) Two Million Housing Programme (1998-2008) Category-wise Performance of Prime Lending Institutions under

Golden Jubilee Rural Housing Finance Scheme in India (2003-2004 to 2006-2007) Integrated Low Cost Sanitation Scheme (ILCS) (2002-

2007) Loan/Dwelling Units Sanctioned for Economically Weaker Sanctions in India (1997-1998 to 2006-2007) Housing and Urban
Development Corporation (HUDCO)
The housing and urban development sector plays a significant role in the economic and social
development of a country. The access to and the quality of housing and urban basic services
directly influence the quality of life of people, their productivity levels and growth potential.

Before the establishment of HUDCO, the Government of India was operating a number of
subsidized housing schemes and loan schemes. The subsidized housing schemes were meant
for industrial workers, economically weaker section of the society and slum dwellers, while the
loan schemes were targeted for the people in the low-income and middle-income groups as
well as rental housing schemes for State Government employees. All these schemes were
under the direct control of the Ministry of Works and Housing. Such a system of housing
finance did not give the required thrust for promoting housing development activities, which in
many cases were considered of lower priority.

Towards the close of the 1960s, it was realized the need of a setting up a housing organization
in the country as the availability and cost of bank credit were the prime constraints in this
development. Since the banking industry, until then, was in the hands of a few industrial
houses, the first major step taken to initiate change in favour of the poor was the
nationalization of the banks in June 1969. However, when the then Honble prime Minister Smt
Indira Gandhi looked for ways to improve the living conditions of slum-dwellers and
economically less fortunate peoples, she found that while we had a host of All India Term
Lending Institution such as IDBI, IFCI, ICICI etc; catering to the diverse credit and related
needs of the Indian industry, there was no institution to provide housing finance to the rural
and urban poor or the even to meet the credit needs of housing boards, development
authorities and other urban bodies which were being setup by the State Government during
the fourth Plan period.

It was in this context that a decision was taken at the highest level to set a Housing and Urban
Development Corporation (HUDCO) which could take a comprehensive look at the need of the
sector and find workable and effective solutions. This experiment of establishing a unique
techno-financial institution and the fascinating journey it undertook during the last four
decades would certainly qualify as one of the key developments in this sector in the whole
world.

The establishment of HUDCO in 1970 as a sectoral institution for comprehensively dealing with
the problems of growing housing shortages, rising number of slums and for fulfilling the
pressing needs of the economically weaker section of the society was one of the significant
steps in the series of initiatives taken by Government. Thus the setting up of HUDCO was
aimed at accelerating the pace of construction and elimination of housing shortages and for
orderly development of urban centres.

The Housing and Urban Development Corporation Ltd. (HUDCO) was incorporated on April 25,
1970 under the Companies Act 1956, as a fully owned enterprise of the Government of India.

The Major Objectives of HUDCO:

1. To provide long term finance for construction of houses for residential purposes or
finance or undertake housing and urban development programmes in the country.
2. To finance or undertake, wholly or partly, the setting up of new or satellite town.

3. To subscribe to the debentures and bonds to be issued by the State Housing (and or
Urban Development) Boards, Improvement Trusts, Development Authorities etc.,
specifically for the purpose of financing housing and urban development programmes.
 4. To finance or undertake the setting up of industrial enterprises of building material.

5. To administer the moneys received, from time to time, from the Government of India
and other sources as grants or otherwise for the purposes of financing or undertaking
housing and urban development programmes in the country.

6. To promote, establish, assist, collaborate and provide consultancy services for the
projects of designing and planning of works relating to Housing and Urban Development
programmes in India and abroad.

Urban housing

Loans for urban housing schemes are provided to housing boards, development authorities,
city improvement trusts, municipal corporations, public sector undertakings, state
governments and other such organisations for the construction of houses/flats and
development serviced plots including site and services, skeletal housing and core housing
schemes.
HUDCO encourages the development of serviced plots and part of loan to be given to general
public for construction by them. These houses/flats/plots are made available to the general
public or on outright sale by the agencies concerned depending upon actual demand.

Under urban housing, HUDCO has so far extended assistance for supporting 56.77 lakh
residential units.
The various projects being funded by HUDCO under Housing include the following:-
Land Acquisition and Development
Urban/Rural Housing for EWS/ LIG/MIG/ HIG and Other Categories
Staff Rental Housing
Individual Home Loans under HUDCO Niwas
Slum rehabilitation/ in-situ development
Repairs and Renewal
Public sector /Private sector Housing Projects
Co-operative Housing Societies both Apex and Primary

Rural Housing

Financial assistance is available to any state govt.agency such as housing board, rural housing
board, district boards, panchayat, taluk development board etc. which is nominated by the
state govt. for undertaking such schemes with hudco's financial assistance.
The following three types of schemes are being financed by hudco in rural areas:

1. EWS rural housing schemes for the landless.

2. EWS rural housing schemes for the land owning category

Village abadi scheme including repairs.

Cooperative housing is one aspect of the housing sector which has claimed a fair share of
HUDCO assistance & support. HUDCO has earmarked certain percentage of its annual loan
sanction for cooperative, which it is expected to progressively increase in the coming year.

Under such schemes, HUDCO lends money to the state level housing finance societies & the
housing boards for undertaking housing projects for members of cooperative societies
according to norms available of Urban Housing Schemes.

VALMIKI AMBEDKAR AWAS YOJANA (VAMBAY)

The then Honble Prime Minister announced on Independence Day, 2001, from the ramparts of the Red
Fort, a new Centrally sponsored scheme called Valmiki Ambedkar Awas Yojana (VAMBAY) with a view to
ameliorating the conditions of the urban slum dwellers living below the poverty line who do not possess
adequate shelter. The scheme has the primary objective to facilitate the construction and up gradation of
the dwelling units for the slum dwellers and to provide health and enabling urban environment through
community toilets under Nirmal Bharat Abhiyan, a component of the scheme. This scheme was formally
launched by the then Honble Prime Minister himself on 2 nd December 2001, at Hyderabad. This is the first
scheme of its kind meant exclusively for slum dwellers with a Government of India subsidy of 50 per cent;
the balance 50 per cent to be arranged by the State Government with ceiling costs prescribed both for
dwelling units/community toilets. The States share may consist of funds from any source in the form of
subsidy or loan from Housing and Urban Development Corporation Limited (HUDCO) or any other agency.
The guideline of the scheme provides for submission of proposals by the nodal agencies of State
Governments to HUDCO who, in turn, process and forward them to this Ministry with their
recommendations. The funds are released by this Ministry only after a VAMBAY account is opened by the
State Nodal Agency and the share of the State/Union Territory Government is deposited in that account.

VAMBAY and the discontinued National Slum Development Programme (NSDP) have been subsumed in a
new scheme called Integrated Housing and Slum Development Programme (IHSDP). This scheme was
launched along with Jawaharlal Nehru National Urban Renewal Mission (JNNURM) by the Honble Prime
Minister on 3rd December 2005. IHSDP aims at having an integrated approach to ameliorate the conditions
of the urban slum dwellers that do not possess adequate shelter and reside in dilapidated conditions.

The scheme is applicable to all cities and towns as per 2001 Census except cities/towns covered under
JNNURM.

INDIRA AWAS YOJANAA

Person whose income is below Rs11800/- is entitled to be a beneficiary under these housing schemes. The
action plan will be prepared on the guidelines issued by government from time to time. The selection of
beneficiary for the above housing schemes will be through gram sabhas.

Two Million Housing Programme (2MHP)

In accordance with the National Housing & Habitat Policy 1998 which focuses on Housing for All as a priority
area, with particular stress on the needs of the Economically Weaker sections and Low Income Group
categories, the Two Million Housing Programme was launched during 1998-99. This is a loan based scheme,
which envisages facilitating construction of 20 lakh additional units every year (7lakh DUs-in urban areas; 13
lakh DUs in Rural areas). HUDCO is to meet the target of 4 lakh dwelling units in urban areas and 6 lakh
dwelling units in rural areas annually. The target of 2 lakh dwelling units in urban areas is to be met by
Housing Finance Institutions [HFIs] recognized by the National Housing Bank & Public Sector Banks and the
balance 1 lakh dwelling units in urban areas by the Co-operative Sector.

Housing Agencies

State Government Bodies

1. Housing Boards/Corporations.
2. Rural Housing Boards/Corporations.
3. Slum Clearance Boards.
4. Development Authorities.
5. Improvement Trusts.
6. Municipal Corporations/Councils.
7. Police Housing Corporations.
Co-operative Societies

Apex Housing Federations.

Co-operative Employers

1. Public Sector.
2. Private Sector.

Community Sector

1. NGOs (Non-Governmental Organisation).

2. CBOs (Community Based Organisations/Voluntary Bodies).
3. Private Builders.
4. Joint Sectors.
5. Individuals (Retail).