Government announces INR 1.5 lakh cr interest-free loans for infra development in states

Central assistance of INR 2.2 lakh cr in next 5 yrs to provide homes for 1cr urban poor, middle-class

NEW DELHI — To help states in developing their infrastructure, the government will provide INR 1.5 lakh crore worth interest-free loans on a long-term basis.

Making the announcement in the Union Budget 2024-25, Finance Minister Nirmala Sitharaman on Tuesday also said private sector investment will be facilitated for the infrastructure sector through viability gap funding.

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The government’s endeavour is to maintain strong fiscal support for infrastructure over the next five years, she said, adding that road connectivity projects will be developed at a cost of INR 26,000 crore.

Among others, industrial node at Gaya on Amritsar-Kolkata Industrial Corridor will be developed.

The capital expenditure is pegged at INR 11,11,111 crore — 3.4 per cent of the GDP.

The Budget has also announced launching the fourth phase of the PM Gram Sadak Yojana in 25 rural habitations and providing assistance to Assam for flood management and related projects.

Meanwhile, the minister said street food hubs will be set up in select cities.

Central assistance of INR 2.2 lakh cr in next 5 yrs to provide homes for 1cr urban poor, middle-class

The government on Tuesday announced central assistance of INR 2.2 lakh crore over the next five years to meet housing requirement of 1 crore urban poor and middle class families under the Pradhan Mantri Awas Yojana-Urban and proposed interest subsidy to provide loans at affordable rates.

In her Budget speech, Finance Minister Nirmala Sitharaman said, “Under the PM Awas Yojana Urban 2.0, housing needs of 1 crore urban poor and middle-class families will be addressed with an investment of INR 10 lakh crore.”

“This will include the central assistance of INR 2.2 lakh crore in the next 5 years,” she added.

The government also plans to provide interest subsidy to facilitate loans at affordable rates, the minister said.

Sitharaman proposed that the government will put in place policies for promoting rental housing markets.

“…enabling policies and regulations for efficient and transparent rental housing markets with enhanced availability will also be put in place,” she said.

Further, the minister said the government will facilitate rental housing with dormitory-type accommodation for industrial workers.

This will be done in PPP (public-private partnership) mode with VGF support and commitment from anchor industries.

On tax proposals, Sitharaman proposed that income from letting out of a house or part of the house by the owner, would not be charged under the head ‘profits and gains of business or profession’ and rather it will be chargeable to tax under the head ‘income from house property’ only.

Regarding TDS (tax deducted at source) on sale of immovable property, she clarified that “where there is more than one transferor or transferee in respect of an immovable property, then such consideration for transfer of the immovable property shall be the aggregate of the amounts paid or payable by all the transferees to the transferor or all the transferors for transfer of such immovable property”.

Sitharaman also proposed amendments to the Prohibition of Benami Property Transactions Act, 1988.

“It is proposed to provide immunity from penalty and prosecution to benamidar on full and true disclosure. It is also proposed to rationalize time limits for attachment of property and reference to adjudicating authority,” she said.