Karnataka Government Approves Major Industrial Land Utilization Reforms
The Karnataka government announced a significant policy revision on Monday, permitting a substantial expansion of built-up area on its industrial land banks. This strategic move is designed to enhance land utilization within Karnataka Industrial Areas Development Board (KIADB) zones and attract fresh investments to the state.
Increased Ground Coverage and Floor Area Ratio
In a key decision, the state has raised the permissible ground coverage for industrial plots from 65% to 75%. This adjustment directly addresses long-standing industry demands for more efficient land use.
Industries Minister MB Patil explained the rationale behind the change: "Previously, only about 65% of the land could be developed, with nearly 35% reserved for setbacks and parking. We have now increased this to 75%. Industry stakeholders consistently requested better land utilization. Our assessment confirms that urban infrastructure, particularly in Bengaluru, can accommodate this increased density."
Revised Framework for Vertical Development
The updated policy framework also introduces a more flexible system for the Floor Area Ratio (FAR), which determines the total permissible built-up area relative to the plot size, thereby governing vertical development.
Under the new norms, the maximum permissible FAR, including premium FAR acquired through additional payments, has been elevated. For plots adjacent to roads wider than 30 meters, the total FAR can now reach up to 5.2. On narrower roads up to 9 meters wide, the total FAR can increase to 2.45, with incremental slabs tied to road width.
The premium FAR mechanism allows developers to exceed the base FAR by paying extra charges linked to the land's allotment value. This provision enables greater vertical construction intensity without expanding the physical land footprint, a crucial factor in land-constrained urban areas.
Industry Applauds the Progressive Move
Industry associations have warmly welcomed the policy revisions. Uma Reddy, President of the Federation of Karnataka Chambers of Commerce and Industry (FKCCI), stated: "This is a highly welcome decision that effectively unlocks land usage potential. When a large portion of land is consumed by setback requirements, the scope for industrial expansion becomes severely limited. Industrial land is a premium resource, and this policy shift should encourage the development of flatted factories."
Flatted factories refer to vertical industrial complexes that house multiple self-contained units for manufacturing, assembly, or warehousing under a single roof. These structures are typically designed to cater to micro, small, and medium enterprises (MSMEs), promoting efficient space use.
Potential Impact on Industrial Clusters
The combined effect of increased ground coverage and expanded premium FAR is expected to significantly alter build intensity within industrial clusters. This change is particularly impactful for urban zones facing land scarcity, where maximizing vertical development is essential for sustainable industrial growth.
By optimizing land utilization and offering greater flexibility in construction, Karnataka aims to strengthen its industrial infrastructure, attract higher investments, and support the growth of MSMEs through modern, space-efficient facilities like flatted factories.
