Information on how much surplus land the government holds is not readily available in the public domain. These lands, whether belonging to the Centre or the state, are spread across urban areas (where the values are likely to be quite high), peri-urban and suburban areas (where land prices are relatively moderate) and rural areas (where land prices are lowest).
Consequently, putting a number on the total area (and its value) of land belonging to the government is a challenge. The country’s Port Authorities certain hold a substantial chunk of it, with the actual size of their holdings in the range of 2.58 lakh acres, out of which approximately 20 per cent is not in use. The Airports Authority of India owns around 49,000 acres and media reports suggest that the defence services hold approximately 17 lakh acres.
The Rail Land Development Authority (RLDA) is the single-largest owner of land in the country. In fact, it has approximately 1.06 lakh acres of vacant land under its purview — most of it in locations where there is a shortage of housing. Certainly, these land holdings represent great opportunities to develop mass housing projects with private sector participation.
MONETISING LAND value:
the process TIMELINE
An interesting question arises when one considers the auctioning of these lands as a potential avenue for lightening fiscal deficit: how long would such a process take?
The time required for marketing these lands would depend on a number of factors. At the first level, the government would need to have a structured sale strategy and a phasing plan that would identify which lands need to be sold in the first phase, and so on.
Lands in urban areas, depending on their location, are likely to be sold at a relatively faster pace. This would, inter alia, entail the definition of ‘reserve prices’ for each of these land parcels. Given the extent, spread, and locational diversity of these lands, such a strategic planning exercise could easily take six months to a year.
Another important fact is that these lands should not be released for sale too quickly. The sudden supply infusion could seriously impact property prices around the areas in question. Further, the market’s appetite for consumption of these lands will play a critical role in how quickly they will be absorbed.
Market appetite is a function of current economic growth, the outlook for various industry sectors, liquidity in the system and the potential demand for