The Karnataka government, under the leadership of Chief Minister Siddaramaiah, is actively exploring the monetisation of approximately 25,000 acres of land near Bengaluru as a strategic move to bolster state finances. This initiative comes in the wake of heightened expenditures incurred by the implementation of five key ‘guarantee’ schemes, which have substantially increased budgetary pressures and pushed the state into a revenue deficit.
Consultancy firm Boston Consulting Group (BCG), engaged by the state’s finance department, has proposed leveraging state-guided urbanisation through land monetisation to unlock untapped budgetary potential. This approach aligns with the government’s objective to mobilise additional resources amidst fiscal challenges, with a target to generate an extra Rs 5,000 crore annually.
Preliminary plans reveal that the government has identified prime parcels of land for monetisation, including 15,000 acres in Nandagudi (Hoskote) and 9,800 acres in Bidadi, earmarked for township development. Additionally, approximately 300-400 acres spread across 73 land parcels under the Bangalore Metropolitan Region Development Authority (BMRDA) are slated for monetisation. Idle lands controlled by the Bangalore Development Authority (BDA) are also under consideration.
“The focus is on fostering public-private partnerships and utilising state-guided urbanisation strategies to optimise assets,” a government official stated. “By rationalising expenditure and tapping into dormant resources like vacant BDA properties, we aim to channel funds towards critical infrastructure development in Bengaluru.”
BCG’s preliminary analysis underscores the urgency for Karnataka to enhance revenue receipts, highlighting that the state’s total receipts as a percentage of Gross State Domestic Product (GSDP) lag behind peers like Maharashtra, Telangana, and Tamil Nadu. This comparison underscores the importance of robust revenue inflows to support comprehensive budgetary allocations.
To streamline expenditures, the government has prioritised sectors such as energy, rural development, irrigation, urban development, and public works. Efforts to rationalise subsidies and optimise budget allocations in key departments are underway to achieve fiscal sustainability and support ongoing developmental initiatives.
Karnataka’s strategic move towards land monetisation reflects a proactive approach to navigate fiscal challenges and sustain economic growth. As the government finalises the best monetisation models in collaboration with stakeholders, the focus remains on ensuring transparency and efficiency in utilising financial resources for the benefit of the state’s residents and infrastructure development.
