PMAY- U 2.0 approved by Union Cabinet with 10 lakh crore investment

The Union Cabinet, chaired by Prime Minister Narendra Modi, approved the Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0 in a meeting on 9 August 2024, which envisages an investment of Rs 10 lakh crores.

The PMAY-U 2.0 will replace the Pradhan Mantri Awas Yojana-Urban (PMAY-U), which was launched on 25 June 2015 and ended on 31 December 2024.

PMAY-U is part of the central government's Housing for All policy, which provides all-weather pucca houses to all eligible beneficiaries in urban areas. 

Duration of the Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0

The duration of the  Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0  is five years.

It aims to facilitate the construction of one crore houses in urban areas for the urban poor and middle-class families.

Nodal Ministry for Implementation of the  Scheme 

The  Union Ministry of Housing and  Urban Affairs will be the nodal body for implementing the  Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0 scheme.

Coverage of the Scheme 

All areas declared as towns by law and mentioned in the 2011 census across the country will be covered.

Beneficiaries of the Scheme 

The Economically Weaker Section (EWS), Low Income Group (LIG) and the Middle Income Group(MIG) in the urban areas that do not have any pucca houses are eligible under the Pradhan Mantri Awas Yojana-Urban (PMAY-U) 2.0. Under the Scheme, the :

• Annual income of the EWS family shall not be more than Rs 3 lakh per year,
• Annual income of the LIG family shall not be more than Rs lakh per year
• Annual income of the MIG family shall be not more than Rs 9 lakh.

Component of the Scheme 

The components of the PMAY-U 2.0 are as follows.

• Beneficiary-Led Construction (BLC)- EWS families will be provided financial assistance to construct houses on their land or the land provided by the state government/Union Territories.
• Affordable Housing in Partnership (AHP)—Financial assistance will be provided to EWS families to own houses being built in different partnerships by States/Union Territories, urban local bodies, and public or Private agencies. 
• Affordable Rental Housing (ARH)- Houses will be constructed to rent to working women, industrial workers, urban migrants, homeless/destitute, students, and other eligible beneficiaries. Unlike the above two components, houses will not be built for beneficiaries' ownership but will be provided for rent. 

Funding of the Scheme 

The total investment required under the PMAY-U 2.0 scheme to build one core house is Rs 10 lakh crore over five years. 

The central government/state government/Union Territories will provide Rs 2.30 lakh crore assistance under the scheme.

The government will provide Rs 2.50 lakh of assistance per house constructed in the BLC and AHP component of the scheme.

As a Centrally Sponsored Scheme, the burden of financing it will be shared by both the central government and the state government in a fixed ratio, as follows;

• Centre and State 60: 40 ratio 
• For Union Territory having legislature (Delhi, Puducherry and Jammu And Kashmir)
• the funding pattern will be  Centre and UT  90:10 ratio 
• For Union Territory, without any legislature, it will be 100 per cent funded by the central government.

Subsidy Under the PMAY-U 2,0 Scheme 

Beneficiaries taking loans up to Rs 25 lakh with a house value up to Rs 35 lakh will be eligible for a 4 per cent interest subsidy on the first Rs 8 lakh loan for a duration of up to 12 years. 

A maximum of Rs 1.80 lakh subsidy will be given to eligible beneficiaries in 5-yearly instalments through the push button.

The entire cost of the subsidy will be borne by the government of India.

Conditions for the States/UT 

The PMAY-U 2.0 has laid certain preconditions for the states/UTs to be eligible to participate in the scheme. The state government/UT has to formulate an “Affordable Housing Policy" containing various reforms and incentives as specified by the central government.

Technology & Innovation Sub-Mission (TISM)

The Technology & Innovation Sub-Mission (TISM) is part of the PMAY-U 2.0 scheme. It will facilitate the state/UT and other stakeholders' adoption of modern, green technology for faster house construction and disaster-resistant, climate-smart buildings