PRADHAN MANTRI AWAS YOJANA

Under the scheme, a central grant of Rs. 1 Lakh to 2.3 Lakh will be provided to the urban poor beneficiaries of the scheme. The grant will come as part of up to 4% interest rate subsidy scheme for the lower income groups. This means that the LIG applicants who wanted to buy a home under the scheme may apply for a housing loan with interest subsidy of up to 4% percent for a tenure or term of up to 15 years.
The total benefit received by this loan subsidy will add up to INR 1 to 2.3 lakh to each applicant. The subsidy will be a major relief for the home buyers as the currently housing loan interest rates are estimated at about 8.5 percent. The ‘Pradhan Mantri Awas Yojana (PMAY)’ scheme will replace all previous government housing schemes such as the Rajiv Awas Yojana.
The mission of providing 2 crore homes to urban poor is estimated to cost the central government about INR 3 lakh crore over the next 7 years, according to preliminary estimates. According to the news reports, the government took about one year to complete the operational guidelines of the scheme after rounds of negotiations with states and Union Territories.
PMAY is not the only scheme which will contribute to the development of housing in urban areas, there are other incentives and subsidies under which a grant of INR 1 lakh per beneficiary will be provided to the state governments for the development of housing projects in slum areas.
The government will also launch affordable rental housing scheme at a later stage. An INR 6,000 crore initiative, is meant to combat the proliferation of slums in urban regions. This was initially to be a part of the PMAY scheme but dropped for unknown reasons.

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