The Telangana Government plans to raise INR 10,000 crore by converting unused industrial land for commercial or residential use, addressing the need for INR 40,000 crore to fund welfare schemes like Rythu Bharosa, loan waiver, and Rythu Bima. Many industrial plots with sale deeds before Telangana's formation remain unused, including 20%-30% in sick and closed industries. A market survey will determine the maximum rate per-acre, estimated at INR 10 crore. The policy will apply to all industrial units, with single-window clearance via TS-iPASS and TS-bPASS. This strategy includes both budgeted and off-budget borrowings, considering FRBM Act conditions.
The Telangana government is exploring a strategy to raise approximately INR 10,000 crore by converting unused industrial land for commercial or residential purposes. This initiative aims to address the significant funding requirement of INR 40,000 crore needed for welfare schemes such as Rythu Bharosa, loan waivers, and Rythu Bima. The government has identified that a large number of industrial plots, which had been allocated before the state's formation, have not initiated any economic activities. These plots are now being considered for land use conversion.
Sources indicate a substantial demand for converting industrial land to commercial or residential use. Additionally, around 20%-30% of the land in some industrial parks is occupied by sick and closed industries. This land could be repurposed for multiple uses, potentially yielding significant revenue for the state. The proposal for land conversion had been thoroughly debated within the finance department as a viable means to generate funds.
The estimated maximum rate for land conversion is about INR 10 crore per acre, but a comprehensive market survey is required to finalize the policy. The government is contemplating applying this land conversion policy to all industrial units, including those allotted to government or private agencies, and even those given on lease in designated industrial areas. Single-window clearance can be facilitated through TS-iPASS and TS-bPASS to streamline the process.
This proposal was initially discussed during the BRS government tenure to pool funds, but no action was taken. After the Congress government assumed power, a preliminary assessment was conducted to determine the extent of unused industrial land parcels. The state government is now considering spending budgeted borrowings for its schemes and exploring off-budget borrowings from the market via the securitization of land to raise funds. However, off-budget borrowings, which are debts taken on behalf of corporations with state government guarantees, must comply with the Fiscal Responsibility Budget Management (FRBM) Act conditions.
The government has not yet fully utilized the budgeted borrowings of around INR 20,000 crore raised this year, with an additional INR 16,000 crore expected to be raised in the next quarter. These funds could be allocated for loan waivers and agricultural schemes, providing some financial flexibility.
In summary, the Telangana government is considering a land conversion policy to convert unused industrial land for commercial or residential use, aiming to raise significant revenue to fund essential welfare schemes. This strategy includes leveraging both budgeted and off-budget borrowings while adhering to financial regulations, reflecting the government's multifaceted approach to resource mobilization.
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