Conversion of leasehold industrial plots into freehold approved for Chandigarh SMEs
For the last nearly 30 years, small and medium enterprises (SMEs) in Chandigarh have been stuck at almost the same scale; but now diversification and expansion is apparently on the cards for these businesses.
The Union Ministry of Home Affairs-appointed Parliamentary Committee on the Union Territory of Chandigarh has given its approval to the conversion of leasehold industrial plots in the city into freehold.
With there being a total of 3,000 industrial plots in the Chandigarh industrial area, 1,800 of which are on a leasehold basis, SMEs in the city have been waging a battle for conversion of leasehold into freehold. The key reason triggering the SMEs’ fight for conversion of leasehold into freehold is that land which is held on lease cannot be used as collateral by businesses that seek working capital from banks.
According to the information shared by Vinod Mittal, president of the Chamber of Chandigarh Industries, it was in 2009 that the proposal for conversion of plots was sent by the a Union Territory administration of Chandigarh, which had allotted the industrial plots in the late 1970s and early 1980s.
The move underscored approximately Rs 450-500 crore in revenue for the Chandigarh administration, to be generated from the one-time charges for conversion of plots from leasehold to freehold; but, as per Mittal, the proposal had been put on the backburner ever since 2009 by successive teams of officials.
Source: Business Standard
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