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The Punjab Cabinet has revamped the state's industrial land conversion policy, making it easier for owners of plots between 1,000 and 4,000 sq yd to shift to commercial uses like healthcare, hospitality, offices, education, and rental housing, subject to local zoning and road width rules. A flat 12.5% conversion fee simplifies what was once a complex process. Larger industrial plots can now be redeveloped into integrated parks with industrial, residential, and commercial spaces. Leasehold plots can also be converted to freehold, potentially generating INR 1,000 crore in fees. The government is also rolling out digital tools and new rules to speed up approvals and reduce red tape.
The Punjab Cabinet has approved an overhaul of the state's industrial land conversion policy. The new policy permits the conversion of industrial plots between 1,000 and 4,000 sq yd into a range of commercial establishments, including healthcare facilities, hospitality venues, educational institutes, offices, and rental housing. These changes are contingent upon existing road width and master plan zoning conditions. The policy now mandates a flat 12.5% conversion fee calculated against the industrial reserve price, aiming to simplify earlier complex and often arbitrary cost structures. Advertisement
Further enhancing development prospects, industrial plots up to 40,000 sq yd will now be eligible to be reconfigured into integrated industrial parks. These parks must maintain a composition of 60% industrial activity, 30% residential housing, and 10% commercial use. Notably, this will be offered under a freehold framework, allowing greater flexibility and long-term planning for developers.
Another major component of the reform is the allowance for leasehold industrial plots and PSIEC-managed sheds to be converted into freehold properties. State officials have projected that this comprehensive change could contribute approximately INR 1,000 crore through conversion fees and related charges.
Alongside the conversion changes, the government has also approved reforms to streamline estate management. Amendments to the rules governing the Micro and Small Enterprises Facilitation Council, new PSIEC guidelines on the clubbing and de-clubbing of plots, and executive modifications within the Directorates of Industries and Town and Country Planning have all been initiated to support smoother implementation. A digital monitoring system, a dedicated grievance cell, and a structured appeals mechanism are also in the pipeline to ensure transparency and reduce bureaucratic delays.
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