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Affordable housing is generally defined as decent, quality housing that costs no more than 30 percent of a households gross monthly income for rent/mortgage and utility payments. On one hand Urban India has high housing shortage , on the other hand there is a massive and rapidly growing stock of vacant houses. In present scenario people susceptible to low or irregular income are likely to find it difficult to buy their own house. According to Census of 2001, India had total residential housing stock of 187 million with only 51 percent permanent dwelling units. Furthermore, out of this housing stock 54% have no sanitation facility, nearly 85% do not have electricity and more than 22% do not have drainage facility. it is estimated that by the year 2021 the population of urban poor will be nearly 180 million. According to an estimate, India had a chronic shortage of 21.23 million dwelling units, out of which 36% are required in urban centers. It seems to be difficult for public sector agencies to accelerate rate of housing provision looking at limited financial resources of Rs. 34,000 crore in comparison to required investment of Rs. 1,21,370 crore for urban centers. Three fourths of the shortage is in the EWS( Economically Weaker Section income up to Rs 5000 per month ) category and another quarter of the shortage is in LIG (Lower Income Group- Income between Rs 5001- 10,000 per month) category. Eighty Seven per cent of households use tap, tube well, hand pump and covered well as source of drinking water. 47% of households have source of water within the premises. whereas 36% of households have to fetch water from a source located within 500 m in rural areas/100 m in urban areas.

Use of electricity as main source of lighting has increased by11 pts to 67 % (compared to 2001) whereas use of kerosene has declined by 12 pts accounting for 31 % of households in 2011. Forty seven % of households have latrine facility (R-31%, U-81%) including 36 % with water closet. There has been 11% decline in households having no latrine . The Jawaharlal Nehru National Urban Renewal Mission (JNNURM), was launched in December 2005 with aim to cover construction of 1.5 m houses for urban poor during the Mission period (2005- 2012). The Indira Awas Yojana (IAY): The Two Million Housing Programme, launched in 1998-99 is a loan based Scheme and seeks to facilitate the construction of 20 lakh additional houses per annum of which 7 lakh are targeted in urban areas and 13 lakh in rural areas. By the 1980s government started realising that with limited resources it can not address the mammoth housing problem and a strong need was felt for the private sector participation. the government should be involved in housing not so much to build but to promote housing activity. This way the gradual shift in the role of government from provider to facilitator was realised, and the first generation of reforms were initiated during 1991 by evolving Public-Private Partnership mechanisms of housing provision to achieve efficiency and effectiveness. The public-private partnership concept for housing provision was put to test during 1990s.