NITI Aayog Favours ‘Generous’ FSI, Flexible Land Use Change Norms


Highlights
  1. Govt plans to build 2.95 crore houses in rural areas & six crore houses in urban areas for the poor
  2. Developers feel that building smaller sized apartments, as mandated by govt would mean that FSI is not most optimally used

The NITI Aayog, government's think tank, has suggested several key changes in government policies to address land availability issues and flexibility in norms to achieve the government's ambitious target of Housing for All by 2022.

In the just drafted 3-year Action Plan, the NITI Aayog has said that the government should work towards bringing down land prices so that more land can be made available for affordable housing projects at lower cost.

Land cost typically constitutes 70% of a project cost. In affordable housing, margins are far more compressed compared to luxury products. Therefore, for any private developer to take up affordable housing projects, as is envisaged by the government under its Affordable Housing in partnership component of Housing for All by 2022, land has to be made available at cheaper rates. 

Venkaiah Naidu, Minister for Urban Development and Housing, has been stressing the fact that the government alone will not be able to meet the Housing for All target. The private players will have to pitch in and the government has already announced several initiatives to entice private developers to take up affordable housing projects. 

Government plans to build 2.95 crore houses in rural areas and six crore houses in urban areas for the poor. 

Developers also feel that building smaller sized apartments, as mandated by the government would necessarily mean that FSI (floor space index) is not most optimally used. 

"We have also said that the government should be more generous with FSI and make land use change norms more flexible. There is a lot of land available with sick PSUs. These land parcels should be released and made available for affordable housing or other developmental purposes", Niti Aayog Vice Chairman Arvind Panagariya said. 

The Aayog that replaced the erstwhile Planning Commission, has also said that the Rent Control Act should be reformed along the lines of the Model Tenancy Act. 

To address the housing shortage problem, the Aayog has said that the government should promote dormitory housing where a large number of people can be provided facilitates for sleeping and some kind of residential accommodation. 

The draft 3-year Action Plan has been prepared after extensive consultations with the states, industry and other stakeholders. The Plan will cover a three year period starting this year till 2020.

"The draft Action Plan has been submitted to the Prime Minister. We have circulated it to all states and other stakeholders for their comments. I will be writing to the states too. The final Plan will be drafted once we receive the feedback," Panagariya added. 

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