LEVERAGING HOUSING FOR THE URBAN POOR THROUGH INNOVATIVE

LEVERAGING HOUSING FOR THE URBAN POOR THROUGH INNOVATIVE

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????????????????????????????????????????????*** Jit Kumar Gupta; [email protected]

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1. INTRODUCTION

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1.1????????????India occupies a unique position globally which is distinctly marked by dualities and contradictions. It has merely 2.4 percent of the world’s land share but houses more than 17 percent of the world’s population. India falls in the category of nations where land-man ratio is very low and land resource is under enormous stress. Looking at the current and future growth of population, sharp decline in land-man ratio will be the obvious result. Nation’s population that was placed at 1022 million in 2001 is estimated to become 1164.3 million in 2011 and 1400 million in 2026. The urban settlements as a class apart are likely to witness massive addition to their population due to the factors of natural increase, rural-urban migration and reclassification of settlements. As per the summary of findings of the committee constituted for the population projection by the Planning Commission of India, it has been estimated that urban population which stood at 285 million in 2001, will become 534 million in 2026 with level of urbanization going up from 27.8% to 38%. This is despite the fact that India as a nation falls in the category of low-income economies, because of low level of urbanization. Looking closely at the population distribution in urban centers, it can be clearly seen that Indian urbanization is heading towards metroplitisation. 35 metropolitan centers jointly provided home to one-third urban population in 2001. The number of metro-cities almost doubled during eighties and projected to grow to 45 by 2011 and 70 by 2021. Obviously their share is likely to increase in years to come due to high degree of concentration of population in those centers. With policies of globalization and economic liberation gaining currency, large urban centers are likely to be the area witnessing massive growth.

1.2????????????Massive growth of population of few urban centers has wide ranging implications in social, economic, physical, infrastructure and environmental terms. Requirement of providing appropriate shelter, amenities and facilities to growing numbers has increased manifolds. In view of the large contribution made by the urban centers to the nation’s economy, which was placed at 29 percent in 1950-51, 47 percent in 1980-81, 60% in 2001 and estimated to go up to 70 percent by 2021, it becomes important that productivity & operational efficiency of urban centers is given high priority. Efficiency and productivity of urban centers closely hinges upon how safe, livable and healthier these settlements are and what kind of quality of life and opportunities of gainful employment they offer to their inhabitants.

1.3????????????With more than 1/3 population (37.3%) living below the poverty line, shelter related policies and programmes in general and shelter for the poor in particular assume importance. Housing has been recognized as one of the most critical elements contributing substantially to the livability and productivity of urban centers. Housing as an activity not only fulfills the basic need of the shelter, which ensures quality of life to the people, but also contributes substantially to the economic growth and development of the people and the state due to its multiplier effect on employment and economy. Adequate housing has been recognized as an important indicator of the growth and development of a nation and quality of life it bestows on its citizens. It is in this context providing adequate shelter assumes priority in the agenda evolved by any welfare state. Even World Assembly of Nations (Habitat – II) took the opportunity of endorsing universal goals of “Ensuring adequate shelter to all and making human settlements safer, healthier, more livable, equitable, sustainable and more productive”.

1.4????????????Considering the importance of housing,” Housing for All” has been identified as a priority area in the National Agenda for the Governance laid down by the ?government. In order to meet the shortfall in housing, National Agenda had set the target for the construction of 20 lakh additional houses every year with emphasis on the poor and the deprived. Out of 20 lakh units, 7 lakhs were to be constructed in urban areas whereas remaining 13 lakhs were to from part of the rural sector. In the urban sector, 4.56 lakh units were to be dedicated to EWS category and remaining 2.44 lakh units for the low income group. Based on average cost of construction of Rs. 35000 for EWS house and Rs. 1 lakh for the LIG house, total financial outlay was estimated to be Rs. 4000 crores on annual basis. Besides arranging land, raising resources for construction of houses was also critical. In fact capacity of the State to generate sufficient financial resources and ?land for these houses was critical to achieve the target. Considering the inadequacy of resources, inefficiency of prevailing land market, high land prices and scarcity of developed land, task became all the more difficult. Appropriate and innovative strategies will have to be evolved in order to ensure availability of adequate resources besides making land available at most affordable price in urban centers for meeting the target of housing the poor.

2. INDIAN HOUSING SCENARIO

2.1??????Despite the fact that 5 decades of post independence era has witnessed distinct improvement in urban housing stock in terms of dwelling units and number of pucca houses but still the situation remains grim. As per the Report of the Technical Group on Estimation of Urban Housing Shortage for the 11th Five Year Plan (2007-2012) set up by the Government of India, Ministry of Urban Poverty Alleviation, out of the total available housing stock of 509.5 lakhs units in 2001 in urban?sector, pucca houses numbered 411.7 lakhs (80.8%) katcha houses numbered 17 lakh units (3.3%) whereas 80.8 lakh units (15.9%) were semi-pucca. Technical Group further placed the urban housing shortage at the end of 10th Five Year Plan at 247.1 lakh units with additional housing requirement of 18.2 lakh units for the 11th Five Year Plan period (2007-2012). Thus, the total housing shortage for the period ending on 2012 was placed at 265.3 lakhs. The housing shortage at the end of 10th Five Year Plan (2007) included 217.8 lakh units in the EWS category, 28.9 lakh units in LIG category and merely 0.4 lakh units for the MIG and HIG. Urban poor have been found to be the worst sufferers in the context of inadequacy in housing because 98.4% of the total shortfall belongs to this category of urban dwellers. Situation would worsen in years to come when future housing requirements due to?population growth, migration and nuclearisation of families in urban centers will to up and will be of the order of 265.3 lakh and 458 lakh units during the period 2007-12 and 2012-21. To meet the shortfall of urban housing for EWS and LIG categories at the end of 11th Plan period, an investment in terms of financial outlay has been placed at Rs. 5,10,000 crores which is evidently beyond the capacity of public agencies to directly meet the requirements and mobilize the funds out of their budgetary resources and the market. This calls for evolving innovative strategies and solutions if the issue of urban housing for the poor has to be clinched effectively.

2.2??????Close scrutiny of the housing stock reveals that supply of shelter specifically for the poor, has not kept pace with the demand in urban areas. The situation shows worsening trends due to ever increasing number of migrants from rural areas. Migrants put pressure on land, urban services and infrastructures, which inevitably lead to congestion, increase in number of pavement dwellers and growth of slums and squatter settlements. Among the poor, women and children have been found to be a class apart, majority of whom are left out of the mainstream of development and shelter related programmes. The growth of slums is a sign of inability of people to afford land and shelter through the normal market mechanism and failure on the part of public sector to ensure equitable access of the same to the poor. As per census 2001, 64.4 million people were living in slums and squatter settlements constituting 22.6% of the total urban population. Nearby 30 percent population in metro cities was found to be in declared slums with Kolkata, Mumbai and Delhi recording higher proportions. Slums and size of cities have been found to have positive co-relation with large centers recording higher number of slums. In these slums absence of adequate water supply, disposal of human waste and garbage collection is predominant with only 37 percent of the households in the bottom half of the urban population having access to all three basic facilities including water supply, sanitation and electricity. Further, 69% of the poor households use community water supply, whereas only 22% of such households have access to the individual connections. 44% of the poor households have their own or shared latrines as against 83% for the top half. 29% of the bottom half of the urban households do not have any drainage connection and 46% are connected to open drains. In the National Seminar on future cities-urban vision: 2021, it was recognized that in years to come, slums would constitute a major chunk of urban population- a fact that needs to be taken note of while evolving urban shelter related strategies for the poor.

2.3 ?????Critically looking at the available housing stock, it will be observed that urban housing does not merely suffer from the malice of quantitative shortage but has distinct qualitative dimensions also. Metropolitan centers like Kolkata and Mumbai have more than 40% households living in single room and another 30% in two rooms. It indicates that majority of urban households live in inadequate housing and inadequate spaces. Large number of household still live in katcha houses, majority of which are non-serviceable and require replacement. Most of the houses do not have access to basic amenities and services. Density of population in lower end housing has increased substantially whereas per capita availability of housing space has declined considerably.

2.4??????Urban centers have witnessed the growth of two distinct types of development, Formal and Informal settlements, having their own characters, norms and standards. These sectors represent the dualities and contradictions emerging in the urban areas with significant variations in availability of floor space, level of services, amenities and quality of life and infrastructures prevailing therein. While floor area availability per capita is 2-3 sq. meters in informal settlement, it is in the range of 6-14 sq. meters in the formal settlements. The parallel existence and development of formal and informal housing stock and settlements in urban India is a phenomenon seen all over the developing world i.e. City within a City- a multiple city syndrome. Distinct settlements of the poor and the rich are a classic testimony to the process of urbanization, which has thrown up “Islands of Affluence in a Sea of Poverty”. In order to clinch the objective of housing for all in urban India, potential of both formal and informal sectors will have to be fully exploited. Ignoring informal sector, which provides only hope and alternative for shelter to urban poor, will bring in distortions in the urban housing market. However, efforts will have to be made to treat the informal sector as an integral part of city growth and development process so that it can contribute substantially to the efficiency and productivity of the city.

2.5??????From the foregoing paras, it can be concluded that Indian housing market is beset with problems like ever growing shortage of housing stock for urban poor, lack of basic infrastructure in terms?of water supply, sewerage, drainage, sanitation, roads, electricity, inadequate housing in terms of available per capita space, overcrowdings of buildings on land and people in the building, poor quality of housing, multiplicity of squatter colonies, haphazard and unplanned growth, mushrooming of slums, encroachment on public spaces, high land cost, scarcity of serviced land and most important, large inadequacy of financial resources with parastatal agencies for funding the housing related activities and programs.

3. STRATEGIES FOR EFFECTIVE RESOURCE MOBILISATION

3.1??????Housing strategies for the urban poor need a holistic and multi-pronged approach covering many aspects, foremost among them would be ensuring adequate availability of financial resources besides supply of serviced land. For effectively addressing the issue, increased flow of money and supply of developed land, its availability in equitable and???????sustainable manner would be vital. The existing acute shortage of financial resources coupled with inequity in access to land by the urban poor has to be mitigated, minimized and eliminated. Shelter related policies and programmes must ensure larger unhindered flow of resources on equitable basis, particularly focusing on the urban poor besides minimizing the restrictions on land supply in order to make the housing market efficient and sensitive to their demand. The priority concern is to make the housing market operationally efficient and socially just

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3.2??????In order to leverage the adequate resources for housing the poor and to achieve the objective of providing affordable shelter to all. National Urban Housing & Habitat Policy was reframed by the Government of India in the year 2007 which aimed at promoting sustainable development of habitat in the country besides promoting various types of public-private partnerships for realizing the goal of affordable housing for all. National Urban Housing & Habitat Policy defines the following agenda to ensure mobilization of adequate funds for housing the urban poor in terms of:

i)???????????????Promoting larger flow of funds from governmental and private sources by designing innovative financial instruments.

ii)?????????????Designing suitable fiscal concessions to ensure that concession are correctly targeted and utilized.

iii)????????????Removing legal barriers to facilitate larger access to finance.

iv)????????????Shifting from demand driven approach and subsidy based housing schemes to cost recovery-cum-subsidy schemes to recycle the available resources.

v)??????????????Encouraging Foreign Direct Investment.

vi)????????????Developing Convergence between urban sector initiative and financial sector reforms.

vii)??????????Reassessing the strength of the Banks and Housing Finance Institutions (HFI) to make them more inclusive to EWS & LIG beneficiaries and intensity their coverage in low income neighborhoods.

viii)????????Setting up of National Shelter Fund under the control of National Housing Bank to provide larger allocations to EWS/LIG categories.

ix)????????????Making larger allocations by HUDCO for encouraging EWS/LIG housing.

3.3??????Based on different options, the strategies for effective resource generation for

housing the poor in the Indian context can be summarized in terms of:

i) Jawaharlal Nehru National Urban Renewal Mission (JNNURM)

Launching of JNNURM has ushered a new era of resource generation for the urban poor in the selected 63 premier mission cities and 65 BSUP cities of the country. Guidelines have been issued by Government of India, Ministry of Housing and Urban Poverty Alleviation, which focus on affordable shelter and slum development. Guidelines for affordable housing in partnership lay down aims and objectives in terms of providing stimulus to economic activities through affordable housing programs in partnership, employment generation, ensuring equitable supply of land, shelter and services at affordable price to prevent growth of slums in urban areas.

JNNURM modified guidelines has defined innovative mechanism for mobilizing resources for providing shelter for the urban poor. The mechanism includes achieving parternership between the beneficiaries, local bodies and the government. In the said scheme, the contribution of the beneficiary has been limited to 10-12% of the cost of house, whereas quantum of funds for housing of the poor to be earmarked has been left to the local body which has been recorded as high as 25% in case of Hyderabad, Vijaywada, Vishakhapatnam and Delhi whereas rest of the housing cost is to be the share of the government. Funds to be tune of Rs. 5,000 crores have been earmarked for 65 cities. Rs.700 Crores have been allocated for 7 mega cities, 1960 crores for 28 million plus cities and 1500 crores for 30 cities identified under BSUP. In addition, Rs. 840 crores have been earmarked for high performing cities/other cities with population more than 5 lakhs. With this, large amount of funds have already been made available and more funds are likely to flow towards the housing for the poor because of the involvement of the beneficiaries and the local bodies. In the given scenario, JNNURM would be leveraging large funds for providing shelter to the poor. Already allocations to the tune of Rs. 6828.31 crores out of approved project cost of 8517.45 Crores have been earmarked under JNNURM up to September, 2009 involving 842 projects. Further funds to be tune of Rs.352.13 crores have already been released by the urban local bodies against their share of Rs. 474.91 crores. Out of 4,64,089 houses sanctioned, 1,30,805 houses have already been constricted for the urban poor. Schemes on the pattern of JNNURM need to be formulated and extended to all other urban centers of the country in order to leverage large investment/ flow of funds for housing the urban poor by the involvement of public sector.

ii) Cross - subsidization

Cross-subsidization can be used effectively for making affordable housing accessible to the urban poor. The option can be exercised for both land and raising resources for housing in the public and private sectors. This mechanism has been used successfully in Hong Kong where problem of low affordability of the poor to land and finances for housing has been resolved by leveraging the public and private sector resources. Cross-subsidization to the extent of 45% of the market value of housing for urban poor has been made possible through the mechanism of comprehensive urban development and re-development programme which capitalizes on increase in land values due to continued re-development of the city of Hong Kong.

iii) Private Sector Involvement

Private sector holds the key in improving the housing and land scenario in the country. Keeping in view the limitations of the public sector, it has now been realized that it is necessary to encourage the private sector in large-scale pooling of resources, assembly, development and disposal of land to supplement the efforts of public agencies. National Urban Housing and Habitat Policy, 2007 has also focused on implementation of the policy through public-private partnership for realizing the goal of affordable housing for all. In the strategies and sources for financing housing development and home ownership in Africa, it has been suggested by the “Shelter Afriquie” that, public-private partnership is a viable vehicle for mobilizing the housing finance as has been done in the case of Algeria, Mali, Senegal, etc. Haryana State has taken a lead in this regards by evolving a comprehensive and effective framework for sanctioning of colonies, which has brought in lot of reputed builders in urban centers of Gurgaon, Faridabad and Panchkula. The Haryana model needs replication by carrying out certain modifications in order to attract these developers to small and medium towns. These developers have not only contributed substantially to the orderly growth and development of urban centers but have also made available large number of plots for the urban poor at an affordable price. In order to attract more resources from the private sector, state must ensure the creation of an enabling environment and remove all road blocks which restrict the operation of private sector in making effective contribution to the housing for poor. State must also provide sufficient fiscal incentives and provision of infrastructure, which can induce private sector to the housing including housing for the poor.

iv) Public-Private Partnership

The combined strength of both public and private sectors can be effectively used on the basis of public-private partnership in providing shelter to the urban poor. State of West Bengal has taken a lead by floating number of joint venture companies between West Bengal Housing Board and reputed private sector companies like Peerless Group, Ambuja Cement etc. Under these JV’s, land is provided by the parastatal agencies whereas resources for construction of housing is provided by the private sector including the beneficiaries. Under this scheme, large proportion of houses have been provided under LIG and EWS categories which are highly subsidized and made available to the urban poor on a predetermined price through a system of prior identification and registration. The subsidy is made good through HIG housing and Commercial sites. Lucknow Development Authority also allotted land to the private developers who were required to provide 40 percent of the plots for EWS category to be handed over to the Development Authority at a predetermined price for disposal to urban poor at a heavily subsidized price by using the mechanism of cross-subsidization

v) Regeneration of Urban Land

Lot of public land is locked in inefficient uses in the urban areas in the shape of closed industrial units, central jails, public offices, institutions, derelict buildings etc. In order to make optimum use of this land, it is essential that?it is brought into urban market and used for meeting the land requirements of housing for both general public and urban poor. In addition, it can help in generating large revenue to the state which can be effectively used for leveraging resources for funding the housing program of the poor. State of Punjab has already launched a scheme called, ‘Optimum Utilization of Vacant Government Lands (OUVGL)’, under which all unused and under used potential public lands are being identified, planned, developed and disposed of for housing and commercial purposes. This has not only generated resources for the state for infrastructure development but has also brought in considerable amount of land into the urban market. Resources generated should be used for creating ?housing for ?the poor in the State.

vi) Taxing Vacant Urban Land

Speculation in land as a phenomenon has gained enormous currency due to substantial gains occuring to the plot holders on account of ever-rising land prices in the urban areas. This process has withheld large quantity of serviced urban land from the land market. In order to bring this land into the market and to minimize land speculation, it would be desirable to tax the owners of such land. The tax liability should be heavy so as to act as deterrent for keeping the land vacant. This would serve dual purpose of land being brought into urban market and also generate resource, which can be utilized for funding the housing for the poor. Punjab Urban Development Authority has imposed extension fee on the vacant plots in the urban estates after three years of allotment @ 2% of the current allotment price. This has resulted in rapid construction on plots lying vacant for number of years besides generating lot of resources.

vii) Adopting Project Based Approach

Creating appropriate level of housing stock for EWS/LIG has suffered in the past due to the passing on / provision of majority of cost of the shelter as subsidy, creating enormous liability for the housing agencies. In order to minimize the component of subsidy, adoption of project based approach would be vital and critical where a product mix of HIG, MIG & LIG/EWS housing can be provided within the same project. Surpluses generated by HIG/MIG categories can be effectively leveraged to create affordable shelter for the poor, meeting the extent of subsidy required for the EWS/LIG categories. In addition, sufficient amount of commercial spaces needs to be provided in the project area which can also be used as generator of resources for the housing of the poor without causing any burden on the parastatal agencies. Further, mechanism of providing subsidy to EWS/LIG housing as an integral part of “Reserve Price” formula can help in making available sufficient resources for the urban poor without impacting the sustainability of housing agencies.

viii) Using land as a Resource

Available land with the parastatal agencies can be leveraged effectively for mobilization of resources for shelter related programs of the poor. In this strategy, land with high degree of developmental potential available with the public agencies can be innovatively used and offered for development to the highest private bidders through a well defined and transparent bidding process and the funds thus generated can be earmarked for construction of housing the poor. In case of Chandigarh, administration has already effectively used this strategy for funding the shelter related program of the poor in order to make Chandigarh a slum free city. Funds to the tune of Rs. 800 crores raised through this mechanism are being utilized for large scale construction of housing for the poor.

ix) Earmarking dedicated funds by all Development Authorities & Housing Boards.

Majority of development and shelter related programs of development agencies focus on higher/middle income groups because these categories generate surpluses for the agencies. Housing for poor remains a losing proposition and a liability and accordingly, such programs are invariably avoided. In order to ensure that such agencies fulfill their basic obligations for catering to the poor, it would be critical that appropriate policy framework is put in place in all states which mandate these agencies to provide and use minimum 20% of their funds for creating shelter for the poor. Such an approach would help in creating enough corpuses for this sector which can be effectively used for creating shelter for the poor. Similarly all financial institutions like Banks, HUDCO, LIC etc. should also be mandated to earmark part of their funds for housing the poor which would ensure larger flow of funds for this sector.

x) Encouraging Housing Co-operatives

Co-operative is one of the most powerful tools for mobilizing and pooling resources for housing development. With appropriate legal framework and skills, many families could be mobilized to invest in their housing. Unfortunately most of the ongoing housing projects and programs focus on individuals, which make it difficult for the agencies to ensure their active participation in the shape of financial contributions. Mechanism of focusing on individual beneficiary needs to be replaced by focus on co-operatives which provide better option/mechanism of involving individual resources for shelter related program on a community basis. Accordingly, state must put in place an appropriate policy options and policy framework which makes it mandatory for all beneficiaries to form housing co-operatives before they are considered eligible for allotment of shelter. In addition, it should also be made mandatory that all beneficiaries would contribute minimum of 25% of the cost of the shelter at the first instance, which can be collected spread over a period of time on daily/monthly basis for avoiding undue hardship. The shelter thus crated should remain in the ownership of co-operatives and not passed on to individuals till the entire cost of the shelter is paid. Housing Co-operatives can also be used for leveraging more contributions from the beneficiaries later on.

xi) Full Cost Recovery

In order to generate sufficient resources for low cost housing, it would be essential to change our mind set and entire approach to this sector. New approach should focus on full cost recovery of the shelter spread over a larger period rather than focusing on provision of huge amount of subsidy, creating enormous liabilities for the state & parastatal agencies. This suggestion is based on the premise that each individual/ family should have the right to shelter which should be appropriately segregated from right to own a shelter. Subsidies should continue to play major role in creating shelter to the poor but right to ownership of the shelter should only be passed to those allottees that pay the entire cost of the dwelling unit. Till the full cost is paid, the allottees should continue to enjoy the right to live in the shelter. This strategy would help in larger cost recovery spread over a period of time. However, the approach would require incentives to be built in for beneficiaries to make full payment of the cost of shelter at the earliest. Revolving fund for the housing of the poor where portion of subsidy recovered can be credited/posted to the account and used further for creating additional shelter for the poor. Such an approach would help in providing much larger resources for EWS housing.

xii) Floating innovative shelter linked schemes

Personal savings either directly through deposits or indirectly through deposits in banks can be most extensively used by the housing finance agencies to fund their mortgages and housing investments. Considering the role and importance of individual resources for creating affordable shelter, this resource needs to be effectively leveraged. At the existing level even in the present scenario more than 70% of the resources for construction of houses still come from the kitty of the individual savings/resources. In order to leverage and tap this valuable resource, effective and attractive schemes for providing shelter can be framed. Accordingly, on the pattern of post office saving schemes, shelter linked saving schemes for the urban poor can be floated by the financial institutions/development authorities/state government which gives priority for such scheme holder in allotment of shelter. This would encourage the active participation of urban poor in their shelter related programs besides generating adequate resources for the housing agencies to fund the construction of the shelter. The scheme should provide enough flexibility to the contributors to design their share in a manner which is based on their capacity to pay. Further the savings should continue to attract higher than normal interest rates in order to attract more savings. Further scheme should envision that larger contributors would to given priority in allocation of shelters making it attractive for the beneficiaries to make higher contributions

xiii) Constitution of shelter related funds

n order to ensure larger flow of funds for housing related programs on sustainable basis, inclusive shelter related fund needs to be constituted at the state and local level. Contribution from select taxes including property tax, transfer of property tax, land use conversion charges, betterment levy, tax increment financing, stamp fee, cess imposed on housing schemes./colonizers, incentive TDR, incentive FAR, contribution by developers in lieu of EWS/LIG houses etc can be used as sources for augmenting the fund.

xiv) Tapping financial markets

Creating a sustainable housing finance system would require wide availability of products and services, easy accessibility and general affordability. In the past, housing was seen as a social undertaking with government as the sole provider. Due to paradigm shift, housing and urban development must operate within national and maybe in the global macro-economic environment. Accordingly, housing must compete for resources with other priority sectors. Accordingly, it will be essential that housing investment ?must provide appropriate benefits and returns to investors like any other investment. Considering that housing by its nature, location is a long term investment, therefore structuring housing markets maybe necessary to improve its liquidity. Since the sources of funds for investment in housing are same as the sources for other investments, therefore, housing investment must be made more competitive in order to attract larger funds. Using the capital market as the mechanism for raising long term resources, countries like Nigeria have already raised over $ 3 billion over 2 years. Similar approach can be adopted in India considering the enormous potential and level of growth of the stock market for generating enormous resources

xv) Leveraging SEZ

India has launched a scheme of special economic zones/mega projects to usher a new era of prosperity and economic development in the country. SEZ involve lot of area, investment, employment and development. Part of the investment in SEZ can be leveraged to provide shelter for the industrial housing catering to the demand of EWS/LIG housing making available large resources for funding the housing of the poor

4. CONCLUSION

4.1??????The way housing and urban infrastructure are financed in developing countries is a topic of renewed debate and a source of creative innovations. It has led to creating mismatch between demand and supply for shelter and basic services where demand for shelter and basic services far outstrip supply making most urban population as slum dwellers. In this era of new liberal economics based on market led growth, interest in financing reflects recognition of the limits of public expenditure. It also reflects the failure of public planning and delivery systems to keep pace with rapid urbanization. It further reflects the initiatives of non-state action to increase supply of housing and infrastructure in the absence of adequate public intervention. The shift in emphasis from public to private sources of finance raises question about the role of state in housing and urban development and by extension, about the future policy of international development co-operation agencies and financial institutes.

4.2??????UN Habitat in its 21st session of the Governing Council meeting held at Nairobi asked the member states to make use of structural adjustments, rapid urbanization; distinct slum economy, accumulated savings, purchasing power of the urban poor, capital housed in provision funds, as well as dedicated public investment to leverage the resource mobilization for the housing of the poor. Program 48 defines agenda for the action to be taken for mobilizing larger resources for the urban poor in terms of:

(a)????????????Stimulating national and local economies that will attract domestic and international financial resources and private investment, generate employment and increase revenues, providing a stronger financial base to support adequate shelter and sustainable human settlement development.

(b)????????????Strengthening fiscal and financial management capacity at all levels, so as to fully develop the available sources of revenue.

(c)????????????Enhancing public revenue through the use of fiscal instruments that are conducive to environmentally sound practices in order to promote direct support for sustainable human settlement development.

(d)????????????Strengthening regulatory and legal frameworks to enable markets to work, overcome market failure and facilitate independent initiative and creativity, as well as to promote socially and environmentally responsible corporate investment and reinvestment in partnership with, local communities and to encourage a wide range of other partnerships to?finance shelter and human settlement development.

(e)????????????Promoting equal access to credit for all people.

(f)?????????????Adopting transparent, timely, predictable and performance based mechanisms for the allocation of resources among different levels of government and various actors.

(g)????????????Fostering the accessibility of the market for less organized or otherwise excluded communities from participation by providing subsidies and promoting appropriate credit mechanisms and other instruments to address their needs.

4.3?????Considering the way, housing and urban infrastructure are financed and the way poverty is getting concentrated in urban centers, making available and ensuring larger flow of funds for the shelter related programs and policies would be critical in order to make urban centers sustainable, productive, humane and livable. Strengthening the existing financial mechanisms, developing innovative approaches for financing,?resources mobilization from various sources including - public, private, multilateral and bilateral - at the international, regional, national and local levels which will promote efficiency, effectiveness and accountable allocation and management of resources, will hold the key to the success for empowering the poor and creating affordable shelter for all.

5.????????BIBLOGRAPHY

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·??????National Urban Housing and Habitat Policy, 2007

·??????Modified Guidelines for Integrated Housing and Slum Development Program – Government of India

·??????Report of the Technical Group on Estimation of Urban Housing Shortage (11th Five Year Plan – 2007-2012), Government of India.

·??????Financing Housing Development and Home Ownership in Africa – Shelter Afrque

·??????Report on UN_HABITAT – 21st Session of the Governing Council

·??????Report of the committee on Population Projection (2001-2006) set up ?by Planning Commission of India.

·??????Suresh V, Gupta TN, Singh Kulwant- Housing Scenario: Policies and Perspectives, National Seminar on Future Cities, October 1997;

·??????Ministry of?Urban Development & Poverty Alleviation, Govt. of India- Recommendations of the Housing Ministers Conference, June, 1998:?

·??????Gupta JK – Managing Urban Planning through Town Planning Schemes in Punjab, ITPI Journal, December 1993, Vol. 12 No. 2 (156);

·??????Gupta JK – National Housing and Habitat Policy 1998- Step in the Right Direction, Shelter, HUDCO, 1999.

Author:

Ar. Jit Kumar Gupta ????????????????????????????

Former; Director??College of Architecture, I.E.T, Bhaddal???????

#344, Sector 40-A??????Chandigarh- 160036?????????????????????????????????????

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