In a major policy revamp aimed at attracting investment and supporting businesses, the Punjab government has approved amendments to its industrial land use and conversion policies. The decision was taken during a cabinet meeting held on Thursday, chaired by senior ministers including Aman Arora and Tarunpreet Singh Sond.
Industrial Land Can Now Host Hotels, Hospitals, and Offices
Under the new policy, industrial plots can now be converted for alternative uses such as hotels, hospitals, banquet halls, office spaces, institutes, and rental or workers’ housing, depending on the plot size and road width. The conversion fee has been fixed at 12.5% of the industrial reserve price.
Larger Plots to Become Industrial Parks
The cabinet also approved the conversion of industrial plots up to 40,000 square yards into mixed-use industrial parks. These parks will be structured as:
- 60% Industrial
- 30% Residential
- 10% Commercial (freehold)
Officials say this shift will encourage integrated development and reduce fragmentation of industrial spaces.
Leasehold to Freehold, Long-Standing Demand Fulfilled
Another key reform includes the conversion of leasehold industrial plots and sheds to freehold, especially those managed by the Punjab Small Industries & Export Corporation Limited (PSIEC). These properties had complex transfer rules that made ownership and sale difficult.
The updated policy is expected to reduce legal disputes, increase transparency, and make transactions smoother. It also stands to generate additional revenue of 1,000 crores for the state.
New Rules Replace Unpopular Clauses
Minister Aman Arora criticized previous governments for policies that discouraged applications. He cited an earlier clause requiring a 50% “unearned increase” payment, which led to only four applications under the previous lease-to-freehold scheme.
“This time, we’ve created a practical policy that’s fair to both industry and the state,” Arora said. “We expect a much better response and improved compliance.”
The industry-friendly changes mark a significant step in reviving industrial estates and stimulating regional economic development.
