The cabinet approval comes in the backdrop of the President giving assent to an amendemnt brought to this effect in the Land Reforms Act of the state in June 2012.
The original Act prevented diversion of plantation land for purposes other than cultivation of the existing product. The amendemnt was brought in August 2005 and was sent for President's assent.
Briefing reporters after a cabinet meeting, Chief Minister Oommen Chandy said only land where no farming was taking place would be allowed for conversion. The main objective, he said, was to increase the revenue from plantations.
He said strict conditions have to be followed while taking up construction activities. Buildings should be environment friendly and should also not change the landscape of the area.
The farm tourism concept was similar to the one implemented in West Bengal and Assam, he said.
To a question, Chandy said cultivation of cash crops in the state would not in any way be affected with the new policy as diversion was allowed only in areas where no cultivation was taking place now.