Why private sector is vital in addressing the urban housing need in India?

Posted on: November 14th, 2016 by No Comments

Right of owning a house is not just limited to people who are part of the higher slab of Maslow’s Hierarchy theory. It is a basic and fundamental right of each and every human being. A decent house in a clean locality is as important as having four square meals and clothing.

For the fundamental right of owning a house to be fulfilled by the government of India it needs to make sure that a minimum of 15 million houses of various types and sizes are constructed. Urbanization of small cities have been picking up pace. The speed is in geometric proportions but providing housing facility for the EWS (Economically Weaker Section) and LIG (Lower Income Group) section of the population of these urban cities have not been able to keep up with the pace of urbanization. And the EWS and LIG section is a very important and major part of any urban society.

According to a survey, a larger portion of this group, unfortunately, is living in cramped, substandard houses which are situated in localities that have limited or no access to civic amenities. One more thing has been noticed that majority of this section are living in rented accommodation.

Many steps have been undertaken by the government to bridge this ever widening gap. Constant measures are being taken by both the central government and the respective state governments to construct cheap affordable house, upgrading slums and rehabilitating slums areas. One such step is to have a mandate for reserving housing projects for EWS/LIG groups for private sector builders. But these measures have not been able to provide the expected results and the numbers as far as the demand for such houses are concerned are growing rapidly.

There are a few developers who are into construction of LIH (Lower Income Housing) but the need of the hour is for the big players to join in. But the major players need to join in. They might have their own apprehensions regarding their profit margin as there are some challenges like increase in land prices and construction cost and long approval times. Their points are valid but that should not be the reason for them to not participate in government’s initiative of providing affordable houses to all sections of society.

There was a survey of LIH developers and around 85% of them were happy with the profit that they have been earning by building LIH or Low Income Housings. And the most encouraging part is that around 90% of the developers showed interest to continue building LIH.

If we need to bridge the gap between the demand and supply of houses for EWS and LIG section then government needs the help of the private players in a very big way. And that is the only solution to bridge this every widening gap.

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