Subsidy enhanced under Indira Awas Yojana

New Delhi, Feb 29 (UNI) Keeping in view the higher cost of construction of houses, Finance Minister, P Chidambaram today proposed to enhance the subsidy per unit in respect of the new houses sanctioned after April 1, 2008 from Rs. 25,000 to Rs. 35,000 in plain areas and Rs 27,500 to Rs 38,500 in hilly / difficult areas for the construction of new houses for the poor through the Indira Awas Yojana (IAY) as a part of Bharat Nirman Programme.

Presenting the Budget proposals for the year 2008-09 in the Lok Sabha, the Finance Minister informed the House that the subsidy for upgradation of houses will be increased from Rs 12,500 per unit to Rs 15,000.

He further added that a beneficiary will still need own funds to complete the house. Accordingly the Public sector banks will be advised to include IAY houses under the differential rate of interest scheme and lend upto Rs 20,000 per unit at an interest rate of 4 percent. He further informed that the housing for the poor is one of six elements of Bharat Nirman and is implemented through IAY.

Against a target of 60 lakh houses, 41.13 houses have been constructed upto December 2007 and cumulative number will be 51.77 lakh houses by the end of March, this year.

UNI MSJ DS1440