The West Bengal government is set to release its new industrial policy by mid-September 2025, and the draft is expected to include selective relaxations in 'land use conversion' rules — a reform aimed squarely at removing a long-standing legal bottleneck that has slowed industrial investment in the state. The relaxations, according to insiders at the state secretariat in Nabanna, will apply only to land procured for manufacturing or services-sector industrial units.

What the Land Use Relaxation Means

Under current rules, even after an investor legally acquires a large plot for an industrial project, converting portions of that land — particularly water bodies — for industrial use requires a lengthy and often prohibitive legal process. The proposed relaxation would waive those procedural hurdles specifically for land already procured for industry.

'Once the selective relaxation in land use conversion rules becomes part of the new industrial policy, those legal complications will be over,' a state government official explained. Critically, the relief will be limited: the real estate sector is reportedly not eligible for the same dispensation, keeping the reform targeted rather than blanket.

Barga Land: Easing Acquisition for Unused Plots

The new policy is also expected to propose simpler norms for acquiring Barga land — plots transferred to sharecroppers through title deeds under West Bengal's landmark land reform programme. Under the Barga system, instead of a fixed cash rent, the cultivator gives an agreed portion of the harvest — often half or a third — to the actual landowner.

The proposed mechanism would allow the state government to procure Barga plots that have remained unused for a specified period. Compensation would be paid at existing market rates, or slightly above, divided in equal proportions between the landowner and the sharecropper. Both parties would retain legal rights over the purchase amount.

This is a notable departure from the fraught land acquisition battles that derailed industrial projects in West Bengal in the past — most notably at Singur and Nandigram — and signals an attempt to create a smoother, consent-driven acquisition pathway.

The Unresolved Problem: Tribal Land

One significant challenge acknowledged openly by officials is the question of tribal land. Existing law strictly prohibits the transfer of tribal land to any non-tribal community — a protection designed to prevent displacement of Scheduled Tribe communities.

'The law on transfer of tribal land is very strict. This land cannot be transferred to any community other than the tribals in any way. As a result, in several districts, just as the government cannot take tribal land for industrial purposes, those landholders cannot sell that land even if they want to. The government does not yet have an immediate solution to this problem,' the official said.

The admission is significant: tribal land holdings are concentrated in districts such as Purulia, Jhargram, and Bankura — areas the state has long sought to attract industry to — meaning the policy will have geographic limits until a legal resolution is found.

What Comes Next

The full industrial policy is expected to be unveiled by mid-September 2025. Industry observers will watch whether the final document includes binding timelines, a single-window clearance mechanism, and — crucially — how the tribal land impasse is addressed. The policy is widely seen as West Bengal's most significant attempt in years to rebuild investor confidence after a prolonged period of industrial stagnation.