Chandigarh, March 31, 2026:
Cabinet Minister for Industries & Commerce, Investment Promotion, Power and Local Government, Sanjeev Arora, announced that the Government of Punjab has approved path-breaking reforms in the policy for conversion of leasehold industrial plots and sheds to freehold, along with a comprehensive rationalisation of post-allotment services for freehold plot holders.
These reforms, formulated after extensive consultations with industry stakeholders and recommendations of the Group of Ministers, reaffirm the Government’s commitment to strengthening Ease of Doing Business and building a transparent, investor-centric industrial ecosystem.
Major Reform: Leasehold to Freehold Conversion
Highlighting key decisions, Sanjeev Arora stated:
Conversion fee fixed at only 5%
100% exemption on stamp duty for conversions completed up to April 30, 2026
Significant relief through remission of charges where unearned increase clause is not applicable
One-time fee structure replaces recurring charges in select cases
Annual renewal charges discontinued for several services
To promote faster conversion and clear legacy issues:
Time-bound disposal of pending transfer and conversion cases
One-time stamp duty waiver to encourage early conversion
Simplified documentation:
Bank letter sufficient in case of mortgaged lease deeds
Clarity on Unearned Increase Clause
Addressing a long-standing industry concern, the Minister clarified:
No unearned increase will be charged:
Where clause is not present in title documents
In family transfers, inheritance, or death cases
Where plots already converted to freehold prior to notification
“This brings long-awaited clarity and protects industrialists from unjustified financial liability,” he added.
Major Ease of Doing Business Reforms (PSIEC)
In a transformational move:
Services reclassified into Mandatory and Optional categories
18 services shifted from Mandatory to Optional
Notarised affidavits replaced with self-declarations
Powers delegated to Estate Officers for faster approvals
“This significantly reduces compliance burden and makes freehold conversion highly advantageous for industry,” Arora said.
Punjab Common Infrastructure (Regulation & Maintenance) Amendment Bill, 2026
The Cabinet has also approved a landmark amendment to modernise industrial infrastructure governance.
Key Highlights:
- Unified & Transparent Infrastructure Management
Uniform mechanism for operation & maintenance of all industrial areas
Covers:
Industrial focal points
Industrial estates
Industrial clusters (including those outside notified parks) - Major Financial Relief to Industry
Service charges to subsume property tax in municipal areas
Eliminates double taxation
Simplifies compliance and reduces financial burden - Innovative Collection Mechanism
Service charges to be collected through electricity bills
Collection by Punjab State Power Corporation Limited (PSPCL)
Benefits:
Improved compliance
Reduced leakage
Seamless and transparent collection system - Industry-Led Governance through SPVs
Special Purpose Vehicles (SPVs) to be:
Registered under Societies Registration Act, 1860
Led by industrial stakeholders
Governance Structure:
7-member elected Executive Committee from industrial allottees
Government officials for coordination and oversight
Clear accountability and professional management - Strong Financial Framework
90% funds → SPVs for maintenance
10% funds → Competent Authority for infrastructure upgrades
Mandatory Corpus Fund for future development
Cap on administrative expenses to ensure efficient utilisation - Accountability & Oversight
Government empowered to:
Audit and supervise SPVs
Supersede non-performing SPVs if required
Empowering Industry & Strengthening Punjab’s Growth
Sanjeev Arora emphasised:
“These landmark reforms reflect our Government’s clear vision — to empower industry, reduce compliance burden, and create a modern, transparent, and self-sustaining industrial ecosystem. Punjab is committed to providing the most competitive and investor-friendly environment in the country.”
Key Takeaways
Massive financial relief for industrialists
Simplified conversion from leasehold to freehold
Reduced compliance and faster approvals
Industry-led infrastructure management
Strong push towards Ease of Doing Business
Punjab Means Business.
