New Delhi: Finance Minister Pranab Mukherjee extended a low interest housing loan scheme and increased the outlay on homes for the urban poor in the 2010-11 budget he presented on Friday.
"I had announced a scheme of one percent interest subvention on housing loans up to Rs 10 lakh where the cost of the house does not exceed Rs 20 lakh. I propose to extend this scheme to March 31, 2011," said Mukherjee in his budget speech at the Lok Sabha.
The government has allocated Rs 700 crore towards this scheme.
In addition, the allocation for housing and urban poverty alleviation schemes has also been raise to Rs.1,000 crore in 2010-11 from Rs.850 crore earlier.
The Finance Minister's proposals were welcomed by the realty sector.
"We welcome the extension of interest subvention scheme. It recognises that cut in interest rates has an important role to play in reducing equated monthly instalment of borrowers and creating additional demand for low cost housing," said Pradeep Jain, chairman of Parsvnath Developers Ltd.
Another social welfare programme, Rajiv Awas Yojana (RAY), which seeks to provide property rights to slum dwellers, was given a huge boost by increasing the allocation to Rs 1,270 crore from Rs 150 crore earlier.
"This marks an increase of over 700 percent. The government's efforts in the implementation of RAY would be to encourage the states to create a slum-free India at the earliest," said Mukherjee.
The Indira Awas Yojana, a rural housing scheme for economically deprived sections, also saw a rise in allocation. The plan outlay for this programme is Rs 10,000 crore now.
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