West Bengal Government Signals Land Reforms: A Potential Boon for Realty Sector

In the budget that was presented to the Assembly on Thursday, the Bengali government made the decision to review and investigate the laws pertaining to land ceilings under the West Bengal Land Ceiling Act as well as the Urban Land Ceiling Act.

For the first time, the land-sensitive state has acknowledged that businesses and industries were being hampered by the land ceiling and has made it plain that it was prepared to review the legislation.


"...the maximum amount of land that may be privately owned is one of the obstacles that confront business and industry. Meanwhile, the Urban Land Ceiling Act has been abolished by the federal government and several states. In this regard, the Urban Land Ceiling Act's present application in our state will also be reviewed and investigated. Chandrima Bhattacharya, the minister of state (independent charge) for finance, presented the budget statement to the Assembly on Thursday. It also states that the Land Ceiling regulations under the West Bengal Land Reforms Act shall be reviewed and investigated.

The real estate industry stands to benefit the most from raising or eliminating the ceiling. It will also assist enterprises searching for sizable land holdings in Bengal, a region renowned for its dispersed land holdings.

Realtor associations have been pressuring the Trinamul government to lift the land cap for years, particularly in metropolitan areas, but the administration has refused to modify the laws from the Left.

This had an effect on the state as well since the urban land ceiling prevented the state from receiving certain monies under the Center's urban development programs.

"I am unable to predict if the urban land ceiling will be lifted. However, there is now debate about whether it ought to be abolished, according to a high ranking state government official.

State authorities claim that the Trinamul administration opposed the removal of the Urban Land Ceiling Act because it believed that impoverished people would be unable to dwell in Calcutta due to land sharks snatching up urban plots in the city and its surrounding areas.

Given that the state administration was initially particularly sensitive to land-related problems, it is unexpected that it has decided to reevaluate its position. A official said, "I believe the land limit would not be entirely eliminated, but investors would have certain advantages in terms of private property ownership.

In cities classified as category A, like as Calcutta, an individual may hold up to 500 square meters under the statute. It is possible to store up to 2,000 square meters in category D locations including Asansol, Burnpur, and Durgapur.

Nevertheless, clever strategies have been used by land purchasers and developers to get around the consequences of purchasing greater parcels of land or developing real estate. However, a lot of national and institutional stakeholders were afraid of these opaque processes.

If the limit is removed or changed, the state may draw in investment of Rs 20,000 crore from domestic and foreign companies, private equity, venture capital, or sovereign funds in the coming years, according to Sidharth Pansari, president of Credai's Calcutta branch.

The head of the state section of Credai, Sushil Mohta, said that he has been begging state governments to abolish or amend the ULCA for the last 25 years. "This decision is very investor-friendly and will improve Bengal's image in the eyes of the global community," he said.

Plots in Sector V and many other places would benefit from the decision to permit the conversion of all land from leasehold to freehold, which Mohta applauded.

Bengali opposition leaders accused the state administration of reverting to the old zamindari system and called for its overthrow.

The Trinamul administration has said unequivocally that it would work to protect real estate brokers' interests. A top BJP official said, "No impoverished person will be able to hang onto their small land holdings and they will be forcibly removed from the city and its outskirts."

"This is a long-standing demand of the land sharks and a reversal of land reforms initiated by our Left Front government," said Md. Salim, state secretary of the CPM. Now, the middle class will be the most negatively impacted if the land ceiling is lifted.