Chandigarh, June 22: To boost industrial development, the Punjab Cabinet on Sunday approved a long-awaited policy that permits the fragmentation of large industrial plots managed by the Punjab State Industries and Export Corporation (PSIEC). The move provides long-pending relief to industrialists and brings clarity to an issue that had sparked controversy in the past.
The new policy will apply to all industrial plots over 1,000 square yards across PSIEC-managed industrial estates, focal points, and growth centres. These plots can now be divided into smaller plots — maintaining a 1:3 width-to-depth ratio — either for sale or distribution among shareholders.
“This is a forward-looking policy, aimed at promoting industrial growth, especially in IT and ITeS sectors,” said Industry Minister Tarunpreet Singh Sond. “It strikes a balance between planning norms and flexibility for industrial investors.”
While the fragmentation policy had been in place since 2005—following approval by the PSIEC Board—it had lacked formal sanction from the state government. That gap led to controversy in 2021 when a 25-acre plot in Mohali was divided into 125 smaller parcels and sold, drawing criticism and prompting the PSIEC Board to suspend fragmentation services in 2022 and 2023.
With the Cabinet’s approval now in place, the government has ordered immediate resumption of services to already fragmented plots under the newly prescribed conditions.
Under the revised policy, plot owners will be required to pay a fragmentation fee equivalent to five per cent of the current reserve price of the original plot. In the case of division among legal heirs, the fee will be halved. Additionally, 40 per cent of the fragmentation revenue—earlier fully retained by PSIEC—will now go to the state treasury.
Fragmentation will be permitted only on plots abutting roads at least 40 feet wide, and each divided plot must not be smaller than 400 square yards. Buyers or inheritors will also be required to operate an industrial unit on the property for a minimum of five years, as per PSIEC zoning regulations.
The Council of Ministers, chaired by Chief Minister Bhagwant Mann, also cleared several other key industry-friendly reforms:
- The Punjab Fire and Emergency Services (Validity of Fire Safety Certificate) Rules will be amended, allowing fire safety certificates to remain valid for three to five years instead of the current one year.
- Amendments to the Punjab Factory Rules, 1952, will now permit self-certification of construction plans by civil or structural engineers with at least five years’ experience.
- Contributions by employers and labourers to the Punjab Labour Welfare Fund will be increased to enhance worker welfare.
In related decisions, the Cabinet approved the creation of 500 posts in the Jails Department to fill vacancies for assistant jail superintendents, warders, and matrons.
It also gave ex post facto approval to a Cabinet sub-committee—chaired by the state Finance Minister—to oversee the ‘War on Drugs’ programme.
Additionally, amendments to the Punjab Regional and Town Planning and Development (PRTPD) Act were cleared, allowing the Chief Secretary to serve as the chairperson of all urban development authorities, a role previously held by the Chief Minister.
The decisions, seen as a major push towards regulatory ease and investment facilitation, were welcomed by industry representatives who had raised concerns at various Sarkar Sanatkar Milni events in recent months.
