Released by NITI Ayog, it explores the role of secure and affordable accommodations for industrial workers in boosting India’s manufacturing sector.
- Further, the importance of executing it under Public-Private Partnership (PPP) model with Viability Gap Funding (VGF) was emphasized in the Union Budget 2024-25.
About SAFE
- Definition: It includes rented, long term dormitory-style accommodation, exclusively for workers in industries, strategically located near workplaces.
- It includes essential amenities such as water, electricity, etc., and excludes family housing.
- Ownership of these units cannot be transferred or sold to workers or employers.
Need for SAFE
- Enhancing Productivity and Retention: Reduces commute times, enhances overall productivity leading to lower attrition rates.
- Attracting Global Investments: Worker welfare and operational efficiency are taken into consideration for making investment decisions by global investors.
- Gender inclusivity: Enhance female labor force participation, which is currently half of countries like China.
Existing Challenges
- Regulatory Challenges: Restrictive Zoning Laws (prohibits residential housing in industrial zones unless explicitly permitted); Conservative Building Bye-Laws (like low Floor Area Ratios limit potential for high capacity housing), etc.
- Economic Challenges: High Operating Costs (accommodations in industrial zones are classified as commercial attracting higher taxes); Higher capital costs, etc.
Key Recommendations
- Reclassify Worker Accommodations: Designate S.A.F.E as a distinct category for GST exemptions, reduced taxes, etc.
- Streamline Environmental Clearances and Flexible Zoning laws: Allowing mixed-use developments.
- Financial Viability: Upto 30-40% of project costs (excluding land) to be provided through VGF, transparent bidding process, etc.
Some Global Best Practices
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