Small industrial projects can get agri land in Karnataka

Small industrial projects with an investment of up to Rs 15 crore can now be set up on agricultural land in Karnataka, after the state government amended rules in the hope of attracting more investment.

The Basavaraj Bommai government recently notified tweaks to the Karnataka Land Reforms Rules, according to which industrial projects worth Rs 15 crore can come under Section 109 of the Karnataka Land Reforms Act.

This means such projects need not follow the ceiling on ownership and other restrictions governing transaction of agricultural land.

Section 109 enables direct purchase of agricultural land from farmers and industrial projects can get up to 40 units (216 acres) of agricultural land. Otherwise, the ceiling prescribed for a family of five people is 108 acres, which is two units (10.8 acres) per head.

The notification states that such smaller industrial projects recommended by the district-level single window agency headed by the deputy commissioner can be granted exemptions under Section 109.

“Clearances given to industrial projects at the state level automatically come under Section 109. However, there was no such mechanism for small industrial projects that get cleared at the district level,” principal secretary (revenue) Tushar Giri Nath said.

He added that the amendment of the rules was an “ease-of-doing-business reform to increase the flow of investments”.

In addition to small projects, industries with a total investment of up to Rs 500 crore can get exemption under Section 109 by the State Level Single Window Clearance Committee (SLSWCC) on the recommendation of the Land Audit Committee headed by the industries minister.

Projects worth more than Rs 500 crore can be brought under Section 109 by the State High Level Clearance Committee (SHLCC) on the recommendation of the Land Audit Committee headed by the chief minister, the notification states.

Last year, Karnataka controversially liberalised agricultural landholding by allowing non-agriculturists to buy farmlands.

Also last year, the government announced that once a proposal to purchase agricultural land for industrial purposes is cleared by the SHLCC or SLSWCC, the process under Section 109 has to be completed in 30 days (it was 60 days earlier). If not, it will be deemed permitted or approved.

These and other reforms will be showcased in the flagship Invest Karnataka summit scheduled to take place in November 2022.

Between January and September this year, 128 investment projects worth Rs 18,357 crore promising 24,853 jobs have been cleared.

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