Pradhan Mantri Awas Yojana suffers major setback as nine states hold back funding

NEW DELHI: The Narendra Modi government’s flagship rural housing programme is suffering a serious financial setback as cash-strapped state governments have refused to release their share of funds.

At least nine states have not released their requisite share to the tune of Rs. 2,915.21 cr for the Pradhan Mantri Awas Yojana (Gramin), which aims to replace all ‘kutcha’ or makeshift houses with permanent ones in rural India. The target is to build 24.7 m houses by March 2022.

As of June 30, about Rs. 2,492.61 crore or 85% of the states’ share has been held back by the Opposition-ruled states of Rajasthan, Chhattisgarh and Jharkhand. Rajasthan has not released Rs. 1,498.41 crore, Chhattisgarh Rs. 762.81 crore and Jharkhand Rs. 231.39 crore for 2019-20.

Construction work under the programme has suffered with lockdowns drying up all sources of revenue and states holding back their share. Against a target of 6.15 million houses, only 755,000 have been sanctioned  this financial year and just 559 completed.

Besides the opposition-ruled states, MP, Gujarat, Haryana, Tripura, UP and Manipur have also not contributed their share of funds. “We have written to state governments to release their share,” a senior rural development ministry official told ET. “We have pointed out to states like Chhattisgarh that they have been giving stipends to farmers but have not released the state share for a scheme that directly benefits the rural poor.

Besides their share, some states have also not released central government funds for the programme. The rural development ministry releases funds to a state nodal account (SNA) from where they are transferred to beneficiaries. There is a gap of Rs 198.65 crore of central funds that have not been released to beneficiaries. The ministry is now mulling direct benefit transfer to beneficiaries, a model similar to that adopted for the Mahatma Gandhi National Rural Employment Guarantee scheme (MNREGA) ..