This demand will be made by housing minister Suresh Jain at a meeting of state housing ministers convened by the union urban affairs and employment minister Ram Jethmalani in Delhi on Monday. "If the slum rehabilitation scheme was covered under infrastructure facility, infrastructure bonds under Section 10 (23G) of the Income Tax Act could have been issued as tax-free bonds," Jain said.

He said the budget's proposal to allow FIIs to invest in unlisted debt securities would provide additional option for marketing the debt instruments. Assistance for basic minimum services and slum development scheme was proposed to be enhanced from Rs 2,873 crore to Rs 3,760 crore. It remains to be seen how much of this would be made available for the state'sslum rehabilitation scheme.

Jain said that deduction to individuals for interest on housing loans, allowed upto Rs 15,000, was being raised to Rs 30,000. "This will encourage people to take housing loans and promote sale of flats in the free sale component in the slum rehabilitation scheme," he said. Jain said the decision to repeal the Urban Land Ceiling and Regulations Act (ULCRA), 1976 would increase supply of usable urban land for housing projects.

The Monday meeting will also discuss issues relating to construction of 20 lakh additional houses every year as announced in the National Agenda for Governance, public-private partnership, user to pay principle, incorporation of cost-effective new building materials and construction techniques and cost recovery.

"Agenda for the housing ministers conference 1998," said the target of 20 lakh houses may be bifurcated as 13 lakh units for rural areas and 7 lakh units for urban areas, based on the housing shortage enumerated in the 1991 Census report. Theaverage cost of construction of new units would be Rs 35,000 for new housing units for economically weaker section (EWS) and Rs 1,00,000 for the low income group (LIG).

Fiscal incentives under Sections 10 (23) G and 80 (1) A under the Income Tax Act for housing initiatives would have to be provided. Further assistance under Section 36 (1) (VIII) of the I-T Act to the housing finance institutions should be continued. In addition, the quantum of concessions under Section 36 (I) (VIII) may be increased for a loan for EWS/LIG (economically weaker sections/low income group).

The agenda paper stated that state governments would have to take up an integrated programme for land assembly and infrastructure development as a precursor for implementing the housing programme.