The government argues that this will facilitate better land utilisation, create high-value urban districts and generate massive revenue.
Published Nov 24, 2025 | 2:56 PM ⚊ Updated Nov 24, 2025 | 2:56 PM
Representational image. Credit: iStock
Synopsis: Telangana’s HILTP-2025 policy allows conversion of 9,292 acres of ageing industrial land within/near ORR into multi-use zones (residential, commercial, IT, etc.). Owners pay 30-50% of land value as one-time fee via TG-iPASS. Aimed at unlocking unviable estates, reducing pollution, and generating massive revenue, it includes a six-month sunset clause for applications.
The Telangana government has approved the Hyderabad Industrial Lands Transformation Policy (HILTP)-2025, paving the way for large-scale conversion of ageing industrial estates located within and near the Outer Ring Road (ORR) into high-value, multi-use zones, undeterred by the BRS criticism that it is a Rs. 5 lakh crore scam in the making.
The policy, cleared through G.O. Ms. No. 27 issued on Saturday, 22 November, aims to unlock thousands of acres of industrial land that have become economically unviable, underutilised, or incompatible with the city’s rapidly expanding urban core.
The move is expected to significantly alter land-use patterns across some of Hyderabad’s oldest industrial hubs — Nacharam, Mallapur, Cherlapally, Moula Ali, Balanagar, Jeedimetla, Kukatpally, Sanathnagar, Gandhinagar, Ramachandrapuram, Patancheru, Kattedan and several others — many of which were established more than five decades ago.
In its policy note, the government said Hyderabad’s transformation into a global metropolis has brought with it new socio-economic and environmental challenges. Industrial estates that were once located on the city’s periphery have now been absorbed into densely populated residential and commercial neighbourhoods.
“Rapid urbanisation has enveloped the industrial estates and parks established 50–60 years ago, making them integral to the city’s urban core,” the order said.
This shift, combined with outdated technology, disrupted supply chains and rising compliance costs, has rendered many industrial units unviable. Widespread closures have left significant land parcels underutilised. The government observed that the resultant mismatch — old industrial clusters now sitting inside busy urban zones — is creating ecological stress and hampering integrated urban planning.
The order lists 22 industrial estates and standalone industrial land parcels, amounting to 9,292.53 acres, of which 4,740 acres are plotted and eligible for conversion under the policy.
They include: IDA Nacharam (700 acres), IP Mallapur (240 acres), IP Cherlapally (762 acres), IP Moula Ali (168 acres), IP Uppal (447 acres),
IP Kukatpally, and IP Jeedimetla (980 acres).
The government has also listed 2,000 acres of standalone industrial lands as eligible for conversion.
The order identifies two core issues.
They are: Economic unviability of industrial units due to outdated technology, market disruptions and growing costs of operating inside dense urban pockets.
Environmental and planning challenges caused by large industrial clusters situated inside the city’s urban fabric.
The government refers to existing G.O. Ms. No. 20 (2013), which mandates shifting polluting industries outside the ORR. While new eco-friendly industrial parks are being developed by TGIIC outside ORR to facilitate relocation, older units within ORR remain locked in expensive, inefficient land uses.
The HILTP is therefore framed as the “logical and strategic next step” to repurpose these vast land parcels into modern, productive and integrated urban spaces.
Under the new policy, land originally classified as “industrial” can now be formally converted into “Multi-Use Zones.” The permitted uses include:
Residential: Apartments, integrated townships.
Commercial: Office spaces, retail, hotels.
Institutional: Schools, colleges, hospitals, research centres.
Recreational: Parks, sports complexes, cultural centres.
IT/ITES: Technology parks, campuses, GRID-aligned IT zones.
The government argues that this will facilitate better land utilisation, create high-value urban districts and generate significant revenue while supporting sustainable urban planning.
A key feature of the policy is the introduction of a one-time Development Impact Fee (DIF), calculated as a percentage of Sub-Registrar Office (SRO) land values.
Two tariff slabs are proposed:
Plots with road width less than 80 ft: 30 percent of SRO value
Covers 54.24 percent of land extent and 82.23 percent of units
Plots with road width 80 ft or more:
50 percent of SRO value
Covers 45.77 percent of land extent and 17.76 percent of units
The fee is inclusive of Change of Land Use (CLU) charges, offering a single-window payment system.
The financial implications, according to the order, are substantial. Funds collected will be allocated as follows:
HMDA/MA&UD: For land-use conversion processing
25 percent retained by TGIIC: For targeted infrastructure development
Balance to State Treasury: To strengthen fiscal position
The policy is therefore expected to unlock thousands of crores in non-tax revenue.
Application & Approval Through TG-iPASS
To prevent fragmented approvals, all industrial parks within ORR will be notified for bulk land-use conversion by HMDA and MA&UD, based on data submitted by TGIIC. Once notified, individual unit holders can apply voluntarily for conversion through the TG-iPASS portal.
20 percent upfront payment of fee during application.
Preliminary scrutiny by TGIIC/IALA within 7 days.
Review by an approval committee headed by the Special Chief Secretary, Industries & Commerce within 7 days.
Demand notice issued within 7 days thereafter.
The remaining 80 percent fee to be paid in two instalments within 45 days each.
Penalties apply for defaults beyond a one-month grace period, and persistent default may lead to forfeiture.
To ensure swift implementation, the government has imposed a six-month sunset clause. Applications must be submitted within six months of the policy’s issuance, failing which units will not be eligible under this special framework.
The order emphasises that the conversion of these long-standing industrial estates has far-reaching implications:
Urban redevelopment potential: Unlocking large contiguous land parcels in prime urban locations.
Environmental benefits: Phasing out old polluting units from residential zones.
Economic value: Creating new areas for IT, services, housing and commerce.
Infrastructure efficiency: Allowing TGIIC to focus on modern industrial parks outside ORR.
The order said that the HILTP offers significant planning, economic and sustainability advantages. It therefore formally approved the policy and authorised the strategic conversion of industrial lands within and near ORR into multi-use zones.
With nearly 10,000 acres identified, experts say this could become one of the largest urban land-transformation exercises undertaken by any Indian state.
(Edited by Amit Vasudev)
