Karnataka could amend law to facilitate land conversion and boost investment

Karnataka is considering amendments to its land income regulations to allow owners of agricultural land to quickly obtain approvals to put their plots for non-agricultural use.

This measure, said Revenue Minister R Ashoka, will help promote investment and entrepreneurship and create new jobs.

The Karnataka Land Revenue Act, 1964, requires owners of agricultural land to apply for a conversion to change the nature of the land from agricultural to non-agricultural. Later, planning authorities will further classify them as residential, industrial, educational, commercial, etc.

These severe restrictions imposed by law are considered among the reasons hindering the expansion of the manufacturing sector in Karnataka. These rules have made it very difficult to buy a plot of farmland and set up a manufacturing unit there, according to industry experts.

Even the owner of agricultural land cannot convert his land to non-agricultural use without going through a long process and paying a bribe, said a farmer near Bidadi, citing his own experience.

Revenue Minister Ashoka told ET it takes four to five months for owners of farmland to convert their plot of land to non-farm use. The process has also been plagued by corruption. “We want to simplify everything. If someone wants to convert their plot to non-agricultural use, we have to allow it without wasting time, ”he said.

This simplification process, Ashoka said, would require changes in the law. Discussions on this matter are still at a preliminary stage and his aim is to do so as soon as possible.

The revenue department found dozens of people endlessly waiting for the conversion to happen after purchasing agricultural plots to use them for non-farming purposes. This, according to the minister, harms investments.

Article 95 of the Karnataka Land Revenue Act prohibits owners of agricultural land from diverting it for purposes other than agriculture. They can only allocate their plots to other uses after approval by the tax authorities after following a legal procedure. Authorities may deny approval or take a long time to decide on the request.

A senior official in the revenue department said there were also discussions about whether to change some sections or remove them altogether to make the whole process easier.