Land prices for industry increase sharply in MP

The MP industry department, which says it can attract more than $2,000 million in two years, has, however, made Madhya Pradesh a costly investment destination.

The Madhya Pradesh Audyogik Kendra Vikas Nigam (MPAKVN), Bhopal, a division of the department of industry, has jacked up land prices for industries in some industrial areas by more than 100 per cent. Last year, the MPAKVN had raised prices but later withdrew the decision.

"We have raised development charges, which were nominal at Rs 10 per square metre. Now the rates have been raised to Rs 120 per square metre," said MPAKVN (Bhopal) Managing Director Ajay Choubey.

With this decision, though the cabinet nod has not been obtained, the industrial land rates have gone up from Rs 110 square metre to Rs 220 square metre for small-scale industries.

Land rates for medium and bigger units have also been raised from Rs 130 per square metre to Rs 240 per square metre in the Mandideep industrial area, Phase I and Phase II.

The land rates for small, medium and big industries in the Pilukhedi industrial area have also been increased. The rates have gone up from Rs 60 per square metre to Rs 170 per square metre for small-scale industries. And the land prices for big- and medium-scale industries have gone up from Rs 80 per square metre to Rs 190 per square metre.

Moreover, setting up a food-processing unit will also be a costlier business in Madhya Pradesh.

The land prices for industrial units at the Babai-Piparia food park, which has been developed under a Central government scheme, have gone up from Rs 60 per square metre to Rs 170 per square metre for small-scale units and Rs 190 per square metre for big and medium scale units.

"The development charges were nominal and so we have raised only development charges and annual maintenance fees," said Choubey. Now the companies will have to pay an annual maintenance fee of Rs 6 per square metre and 3 per cent of the lease rent premium.