Budget 2022: Rs 48,000 cr outlay for PMAY to boost housing sector

The government’s renewed push for greater infrastructure development and massive allocations for the subsidised housing scheme has brought cheers for the country’s real estate and construction companies. 

A Rs 48,000 crore budget allocation for the Pradhan Mantri Away Yojana (PMAY) has been announced by the Finance Minister Nirmala Sitaraman for the fiscal year 2022-23 in today’s union budget. This is 75 per cent higher than the Rs 27,500 crore budget allocation made in FY2021-22 and marginally higher than the Rs 47,390 crore in the revised estimate for the current fiscal. 

To ramp up the ‘housing for all’ initiative and boost the economic activities the government increased the allocation substantially in the current year. And to keep the momentum going has kept the funds at similar levels for the next year, with a target of handing over 80 lakh homes to urban and rural dwellers. This, according to industry experts, will be a big boost for the housing sector in the country.

“This, yet again, showcases the government’s commitment on building affordable housing stock”, said Ramesh Nair, CEO, India and Managing Director, Market Development, Asia at Colliers.

According to Anuj Puri, Chairman at Anarock Group, the Budget has promise of providing a broad-spectrum booster shot to the economy, especially with its emphasis on building the infrastructure of the country. 

“To facilitate digital inclusion and aid fund transfer, all of the 1.5 lakh post offices will come under the complete banking system. This will enable smooth and transparent real estate transactions in the rural areas and also encourage loan disbursal to the semi urban population,” he said.

Further, the FM’s announcement on emphasising on urban planning for smaller towns - especially in Tier II and III categories - will further help real estate player. According to the FM, a high-level panel comprising urban economists, planners and other experts, to be set up for urban planning in FY2022-23 under government support.

“Government has treaded a line of fine balance to lead the economy to high GDP growth rate by investing in infrastructure sector, yet keeping the fiscal deficit within manageable limits. In the backdrop of ambitious ‘housing for all’, PMAY has been given due importance, however largely through Government’s flagship programmes rather than the incentives real estate development companies were hoping for,” said R K Arora, Chairman, Supertech.

According to Suren Goyal, Partner at the professional services firm RPS Group, the “emphasis on the infrastructure sector will boost growth in the medium to long term and will help the country in maintaining its position as the fastest growing major economy in the world”.