The Government of India, on Monday, announced signing of a $150-million loan from Asian Development Bank (ADB) for a housing project for the urban poor in Tamil Nadu.

A Union Finance Ministry press release said that nearly half of Tamil Nadu’s 72 million population lives in urban areas making it one of the most urbanised States in India. Through the Tamil Nadu Urban Habitat Development Board, the project will construct houses in nine locations and relocate about 6,000 households vulnerable to natural hazards, it added.

The project will also help Tamil Nadu’s Directorate of Town and Country Planning develop regional plans to map the State’s economic and infrastructure development including affordable housing, environmental protection, disaster risk management, and gender.

The agreement was signed by Rajat Kumar Mishra, Additional Secretary, Department of Economic Affairs in the Ministry of Finance, and Takeo Konishi, Country Director of ADB’s India Resident Mission on December 7.

“Rapid urbanisation and growth in Tamil Nadu have created a housing shortfall particularly for low-income households,” Konishi said, adding, “The project will provide access to affordable housing infrastructure and services to vulnerable and disadvantaged households and catalysze private sector investment in affordable housing.”

Catalysing private sector

A portion of ADB’s assistance will be invested by the State as equity into the Tamil Nadu Shelter Fund to catalyse private sector financing and support investments mainly in industrial housing and working women’s hostels for low-income and migrant workers.

In addition, ADB will provide a $1.5-million technical assistance grant to support the capacity building of government agencies responsible for delivering affordable housing and regional planning. It will document successful approaches to affordable housing delivery, including the graduation programme for vulnerable relocated beneficiaries, that can be adopted in other cities and countries.

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