NITI Aayog comes up with model land lease law to push industrialisation

31 March 2016

NITI Aayog has proposed a new modal law on land lease that would make available agricultural land for industrial and commercial purposes and bring in flexibility in land use.

The model law which vests ownership of the land with the original owner while permitting alternative use of land by the tenant, if implemented, will help quicken the pace of industrialisation, according to NITI Aayog.

The new model law on land lease is based on the recommendations of an expert committee set up in September last year, under T Haque, former chairman of the Commission for Agricultural Costs and Prices. The committee was asked to prepare a model agricultural land leasing law in consultation with states, keeping in view the need to legalise and liberalise land leasing for much-needed agricultural efficiency, equity, occupational diversification and rapid rural transformation.

The draft model Act, which is expected to be put up for stakeholder comments this week will offer flexibility to land owners and tenants to decide on the term of lease and rent, thus making it simpler for the government to lease land for public-private partnership projects in sectors other than agriculture.

Further, it will also open up avenues to the provision of land for industrialisation, which is fully within the state's jurisdiction.

It may also help tenants secure short-term credit and other services on the basis of a simpler lease agreement.

The model law provides for automatic renewal of agreement on the expiry of lease period while simplifying the procedure for lease termination within the agreement period.

The centre and state governments will now be able to implement their policies efficiently in the presence of transparent land leasing law.

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