The proposed jantri revision, if implemented, could significantly affect rates of plots in GIDC estates and private land, which in turn could threaten to impact industrial investments in the state. Officials in the state industries department have pointed out that the timing of land acquisition for new GIDC estates now becomes crucial.
“With over 20 new estates planned across various talukas, swift action on land acquisition before the implementation of revised rates is essential. The compensation formula of four times the jantri rate means that delayed acquisitions could lead to substantially higher costs,” said a senior official from the department.He further added, “Small and medium enterprises (SMEs) are likely to face the greatest challenge, as increased land costs could make their projects financially unviable. The current scenario where land costs constitute approximately 25% of project investments could see a marked increase, potentially deterring new entrepreneurs from setting up manufacturing units.”
The private industrial sector faces similar challenges. “Industrial parks developed by private entities will need to factor in higher land costs, which will inevitably be passed on to end users. This could make Gujarat less competitive compared to other states in attracting new industrial investments,” added another official from the industries department.
The district land valuation committee’s role has become more critical in this scenario. While it can offer concessions for govt land acquisition by GIDC, the baseline increase in jantri rates will still result in higher final costs. “This could affect the state govt’s ability to offer competitive rates to industries, particularly in newly announced estates in rural and backward areas,” said the official.
The ripple effect of increased land cost could extend to ancillary industries and support services. Higher establishment costs might force industries to reconsider their expansion plans or look for alternative locations in other states, potentially affecting Gujarat’s position as a preferred industrial destination.For existing industries planning expansion, the increased rates could affect their growth strategies due to delayed implementations or scaled-down projects. This could particularly affect labour-intensive industries where large land parcels are required for operations.
Advocating a balanced approach, industrial associations and chambers of commerce suggest the rates should be aligned with actual market conditions and industrial development goals, ensuring that Gujarat maintains its competitive edge in attracting investments.
