Punjab Government Announces Landmark Industrial Reforms

Cabinet Approves Major Amendments on Leasehold to Freehold & Industrial Infrastructure Management: Sanjeev Arora 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: 1. 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) 2. Major Financial Relief to Industry Service charges to subsume property tax in municipal areas Eliminates double taxation Simplifies compliance and reduces financial burden 3. 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 4. 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 5. 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 6. 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.