Accommodating Housing in India: Lessons from Development Capital, Policy Frames, and Slums

Abstract

Since the nation’s first Five-Year Plan in 1951, the Government of India has focused attention on increasing the country’s housing supply, particularly for low-income households. The nature of housing policy has shifted over the years, however, with the most recent period focused on developing a private housing market through governmental support of mortgage finance institutions and the establishment of a housing finance regulator. Despite these efforts, recent estimates place India’s housing deficit at close to 19 million units with tens of millions of the nation’s population living in slums. There has been limited research that has traced the evolution of India’s housing policy since 1951, precluding our ability to understand the persistence of unmet housing demand and the proliferation of slums.This dissertation fills this gap by examining how low-income housing policy is shaped in India at three scales: 1) the global, 2) the national, and 3) the local or household scale. It argues that this multi-scalar approach to examining housing policy is necessary in order understand the factors that shape specific policy regimes. In India, international flows of capital collide with nationalistic goals of “slum-free” cities to produce specific policy actions, which again are shaped by the particulars of households’ decisions about where they choose to live and why. The dissertation is organized as follows. Chapter 1 introduces the low-income housing challenge in India, describes the three housing policy paradigms that dominate global housing policy discourse and praxis, and provides a review of how housing is funded in India. Chapter 2 approaches low-income housing policy at the global scale, applying theories of policy diffusion to make the case that low-income housing policy in India is shaped by funding flows and knowledge-sharing from international actors. This chapter traces shelter lending from the World Bank Group, the single largest outside provider of development capital for housing to India, and examines the degree and type of influence the Bank has had on India’s approach to low-income housing. This analysis reveals that India is most susceptible to policy shifts that reflect the World Bank’s own policy objectives when it is most in need of outside funding. When India’s financial position is strong, housing projects are seen as attractive investments by the World Bank Group’s private sector arm and serve to provide momentum for India’s own housing policy objectives. Chapter 3 is situated at the national scale and examines the role of policy frames in India’s public discourse on low-income housing in shaping the specific policies of different planning eras. The analysis applies a mixed-methods approach to reading the housing-related chapters in each of India’s twelve Five-Year Plans. These documents provide an ongoing, textual record of national directives and external messages concerning the country’s central planning efforts. Subjecting the plans to qualitative content and computational text analyses reveals the contours of India’s housing policy frames. This chapter finds that larger shifts in policy frames occur after significant events that fundamentally alter the Government of India’s conception of its institutional and fiduciary role in low-income housing provision.Chapter 4 concentrates on the local scale, examining housing demand across two major Indian cities. The myriad low-income housing policies implemented by the Government of India have systematically overlooked low-income households’ demand or willingness to pay for housing. This chapter questions whether low-income housing policies have been remiss in ignoring their beneficiaries' preferences for housing characteristics. The data used here are previously-collected household surveys in the Maharashtrian cities of Mumbai and Pune. Using a hedonic analysis of housing markets, this chapter compares income and price elasticities of demand between slum and non-slum households. The findings reveal that demand elasticities are higher among slum-households, but also expose a number of empirical issues that compromise external validity when using pre-existing household survey data. The findings from this dissertation have implications for India as it continues to urbanize and craft housing policies to address imminent growth. Other developing and emerging economies can also benefit from this scaled analysis that utilizes a range of data sources and methods to critically examine the role external forces play in shaping national housing policy, how the national government frames its approach to low-income housing, and what household behavior can reveal about which policies to pursue.

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