Bengaluru, Karnataka Minister for Large and Medium Industries, Murugesh R. Nirani, announced on Saturday that the Karnataka Industrial Areas Development Board (KIADB) will allott land to industries or institutions on a '10-year lease-cum-sale' basis by amending the existing rules, much to the delight of industrialists and investors.

Piloted by Nirani, the state Cabinet recently cleared the proposal to amend the KIADB provisions wherein the clear titles (sales deed) of the allotted land are handed over to the industrialists once the allottees successfully run the project for a couple of years.

Addressing the reluctance of many investors to invest in the state due to the existing policy, the KIADB in future will allot all lands to private industries/institutions on a 10-year lease-cum-sale basis.

"Rules are being framed for the new scheme and a full-fledged government order in this regard is expected to be issued in a couple of weeks' time," said Nirani.

Before the matter reached the Cabinet, the policy was discussed in detail with the senior officials of the industries department and other stakeholders in August and September last year.

Several private companies were reluctant to set up industries in the state as the KIADB used to allot more than 2 acres of land only on 99-year lease basis. There was never a provision for sale of the allotted land. The earlier clause was posing difficulties for the industries to obtain loan from banks and financial institutions and mortgage the leased land. This had hampered the flow of investments into the state.

Through the proposed amendment, if any of the industrial unit is successfully run for two years soon after the land allotment, it will qualify for getting clear sales deed title from the KIADB without waiting for 10 years. The department through its officials and experts will monitor the balancesheet of the industry for 24-months to check the claims of running the project successfully.

According to KIADB rules, MSME sectors have to set up industry and start production within three years from the date of allotment of land. For the large and medium industries, the time frame is five years.

"The amendment will encourage the industry for further expansion and investment as allotted land will be under their ownership once they successfully run the company," Nirani maintained.