High Land Prices Driving Industries Away to Kerala, Gujarat, Andhra and Rajasthan

The Congress government revised land rates twice since 2005 in a populist move to please landowners. From Rs. 8.60 lakhs per acre in 2004-05 the price went up to Rs. 24 lakhs per acre in 2007-08 inBahadurgarh whereas in Barhi the acquisition price stood at Rs. 49 lakh per acre in 2009. 

Prices have simply tripled as can be seen from the real estate rate in Manesar where the going rate is Rs. 18 lakhs per acre as compared to Rs. 4 to Rs. 6 lakhs per acre in 2004. Landowners may be happy anticipating big profits but the government did not foresee a fallout. The high price is making it unviable for industries, especially those in the small and mediumsectors, to initiate any projects or undertake expansion. While the Industries Department claims there is no slowdown, facts indicate otherwise.

In Rajasthan, Kerala and Andhra Pradesh the current prices are one-third those in Haryana. Gujarat is luring medium and large-scale industries with incentives. On the other hand there is a general slowdown in manufacturing and locational disadvantages too work against Haryana as a destination for industries. Therefore, it is not surprising if there is a slowdown in new industrial ventures in this State.

The Industries Minister of Haryana, Mr Randeep Singh Surjewala, justified high prices on the grounds that the land here is fertile and tillable soil, unlike barren lands in other States, and consideration such as agricultural production were factored into while fixing land prices in the State.