Shri Murugesh Nirani the Karnataka Industries Minister announced on Saturday that a new policy will permit state-owned land to be sold to industrial enterprises that have performed successfully for two years, a move that the government hopes will improve the flow of investments.
The government is developing a 10-year lease-cumulative-sale mechanism for land given to enterprises by the Karnataka Industrial Areas Development Board (KIADB).
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‘Any industry that runs successfully for two years soon after the land being allotted, it will qualify to get the clear sale deed title from the KIADB without having to wait ten long years,’ Nirani said in a statement, adding that balance sheets for the previous 24 months will be verified to see if the unit’s business was good.
‘Rules for the new plan are being drafted, and a government order is anticipated to be published in a few of weeks,’ he said.
At the moment, only land larger than two acres is leased to enterprises on a 99-year basis. ‘There is no provision for the sale of the assigned land,’ Nirani explained, adding that some significant private corporations are hesitant to establish enterprises because of this condition.
‘This condition makes it impossible for industries to receive loans and money from banks and financial organizations, as well as mortgage the leased land.’ As a result, the flow of investments into the state was hindered,’ he stated.
According to him, in the future, KIADB will assign lands to private enterprises or institutions on a 10-year lease-cum-sale basis. This will necessitate changes to the KIADB Act, which Nirani stated has been approved by the Cabinet.
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‘According to KIADB norms, MSMEs must establish and begin production within three years following land allotment. The time limit for large and medium-sized industries is five years,’ Nirani explained. ‘The modification will encourage industries to develop further because the assigned land will be theirs if they operate successful operations,’ he added.