Blow to plan on shut firms' land

Units with 500 acres stay off lease route

  • Published 12.03.18

Calcutta: The Mamata Banerjee government's plan to reuse 11,000 acres possessed by about 450 closed firms for industrialisation seemed to have suffered a setback as no unit with over 500 acres has come forward to lease out the plots.

In March 2017, the Bengal government had amended the West Bengal Land Reforms Act, 1955, to allow owners of closed factories to lease out the plots to other investors following permission from the land and land reforms department.

The initiative was taken to smoothen the process of using the plots of closed factories as arranging land for industries was getting tough in Bengal because of the hands-off land policy of the government.

"So far, less than 10 applications urging permission to lease out plots of closed units have reached Nabanna. But none of them was significant, as all the factories own less than 50 acres. The target was to reach out to the owners of closed factories, which possess over 500 acres," said a senior state government official.

Senior officials said as none of the owners of closed units, who possess large land parcels, had come forward, it appeared that unlocking such land for fresh investments would be a difficult task.

Sources said there might be three reasons for the lack of response from the owners. First, majority of the closed units are under Board for Industrial and Financial Reconstruction (BIFR) and second, plots of a large number of units are mortgaged to banks.

Officials also hint at a possibility that the character of land possessed by a number of units has already changed and those are already used for developing real estate.

"Even if owners of 4,000 acres of land could be persuaded with the new scheme, it would have been hugely beneficial for the state... But it appears that the trick did not work," said a senior official.

The Bengal government had made a similar attempt earlier in 2015 by setting up a Group of Ministers to find out how much land of closed units could be used. But that effort lost steam because of unavailability of required papers from the closed units.

The initiative to unlock the land possessed by the closed units was taken about three years back when a study carried out by the state labour department had revealed that there are about 450 closed units and each of them possessed more than 500 acres of land.

The main target of the government was to unlock plots of some of the units with more than 500 acres of land.

Sources said the act was amended to encourage the owners of closed units to lease out their plots to new investors.

"Earlier, the owners of the closed units had to surrender their plots if they failed to run the units for which land was allotted. It was found that the owners never came forward and surrendered their plots, as it did not give them any benefit. The government amended the act to encourage the owners to lease out their plots as it would have earned handsome amount for them," said an official.