Land is arguably the most constraining factor of production. The total developable footprint is fixed. It is also the most complex and diverse among the factors of production, given that it is a subject administered by state governments, and there are a plethora of laws and land fees/rates. I blogged here about the prohibitive cost of doing business in terms of land prices across India.
Fortunately, the diversity of state laws offers low-hanging reform opportunities just by emulating the good practices being followed in a few Indian states. This post will point to a few options.
As a framework to analyse land market distortions, I can think of thirteen, spanning four categories. On the supply side, there is the low Floor Area Ratio (FAR), idling or inefficiently used public lands, and the high cost of conversion. On the demand side, there are the high stamp duty and registration fees, and the prohibitive prices. The transaction frictions include the problems with titles, outdated surveys and land records, the separation of registration-survey-mutation, widespread land-related litigation, and corruption at sub-registrar offices. The incentive distortions cover the registration–market valuation wedge, black money, suppressed mortgages, and under-assessed property tax. The graphic below seeks to capture them with their estimated quantification.
The graphic below provides a global perspective to couple of these distortions.

A detailed discussion of these is for another time. But there are deep political economy problems with some of the reforms. In the circumstances, I can think of four realistic reforms in the first phase: increase supply, better management of records and transactions, lower cost of transactions, and reduce the dual pricing wedge.
On increasing supply, I have written several posts on the importance of promoting vertical urban growth by lowering FAR, easing setback restrictions, and increasing ground coverage thresholds.
The management of records and transactions is a low-hanging fruit. Land records, survey records, and registration constitute the plumbing of land documentation and transactions. Currently they are three standalone activities, with their own workflows and documentation. This is a problem since registration does not automatically update records (the process called mutation).
Three states have undertaken major reforms in addressing this problem. Telangana’s Dharani portal does registration-cum-mutation in a single transaction (only for agricultural land), with the Pahani/Record of Rights (RoR) auto-updating (typically within a few days). Karnataka has an automatic property mutation system that has automated the large majority of khata transfers by integrating its Kaveri and Bhoomi databases. However, in both cases, while registration and mutation are linked, the cadastral subdivision lags.
The state that has gone farthest is Andhra Pradesh, which undertakes auto-mutation for both rural (1-B/Adangal auto-update on registration) and urban (the 2026 Municipal Laws Third Amendment making municipal-record mutation automatic at registration) lands. Further, it has also linked survey records updation by mandating all registrations to be done only after sub-division.
This is a fundamental reform and must be emulated across states. It requires making registration (of sale/partition/gift) the single trigger that automatically fires a mutation in the Record of Rights and the survey/cadastral map. On the technical and process side, this in turn requires electronic integration of the three databases, digital workflow automation with deemed timelines, and validation against prohibited or encumbered lists at the registration stage itself. On the legal side, while mutation and survey/settlement are on the State List, registration is on the Concurrent List, and the Registration Act 1908 is a central Act. Therefore, any state-level amendment to the Registration Act itself to trigger auto-mutation would require a Presidential assent under Article 254(2). All three states have taken this route.
This must be complemented with a second reform to ensure that the process of changes to land records is standardised so as to eliminate disputes and litigation. A majority of land-related litigation arises from inconsistencies and discrepancies in land records, which undergo changes due to registration, inheritance, gifts, partitions, acquisition, court decrees, correction of clerical or survey errors, and mortgage or charge creation.
One-time clean-ups of land records have been unsuccessfully attempted by states over the years and are fraught with practical problems, besides not addressing the root cause. A prudent strategy would be to put in place protocols and systems to standardise changes going forward and work on incrementally improving the quality of antecedent records.
In July 2026, Andhra Pradesh did precisely this by issuing GO No 445 that created a single unified due-process procedure for making changes to recorded ownership or title, or enjoyment rights in revenue records. It treats these as rights-affecting, quasi-judicial actions requiring a documented evidentiary basis, precise identification of the affected extent, action attributable to an identifiable officer, prior notice, and a 30-day opportunity to object, a hearing, a reasoned (“speaking”) order, independent maker–checker verification, and full digital attribution and audit trail.
In essence, the Andhra Pradesh reforms involved shifting from a fragmented and sometimes opaque property-record administration toward a centralised, digitised, and traceable system with substantially stronger procedural safeguards for citizens. This, too, can be copied by other states (provided they also have the digital plumbing to support the associated processes).
An associated reform that the state did was to clean up its prohibited register, which consists of lands that cannot be transacted in the routine course for various reasons, including government, waqf, religious and charitable institutions, ceiling-surplus, etc. As per Section 22-A of the Registration Act 1908 (AP Amendment 2007), the Sub Registrar must refuse registration of any property in this register. Thanks to its non-updation, large numbers of private land parcels (like government lands assigned to various categories of people) continue to remain in the register.
In early 2026, AP issued a memo to delete five categories of lands from this register, and followed up with a special drive across districts to verify and delete them, thereby easing registration for owners who couldn’t produce a long document chain. It also issued orders that standardised what goes into the register and brought it under the control of the Registration Department, and a single unified due-process procedure for both adding and deleting property to and from the register.
Other states with similar prohibited registers could undertake a process to audit their registers for wrongly entered private lands, define deletable categories by policy (instead of ad-hoc deletions), do field verification by the revenue officials, and delete entries in the digital register, all undertaken with adequate safeguards and audit trails to prevent any abuse. And all of this should be supplemented with a mechanism to standardise and digitise future additions and deletions.
A third reform would be the reduction of land-related taxes. There are two kinds of land fees: conversion of agricultural land and registration taxes (consisting of the stamp duty and registration fees). The table below captures the rates across these three tax/fee categories.
West Bengal is the surprising leader, alongside Maharashtra. The biggest opportunities are for states like UP, Gujarat, and Rajasthan with their very high combined fees.
On a related note, an issue that is often surfaced as symptomatic of the problems with India’s land administration is the agricultural land conversion process. As the table shows, apart from high fees, it generally involves a long process, takes time, and can be rife with uncertainties and corruption. This deters economic activity in the rural areas.
A fourth reform, to address this problem, would be to simplify the process of agricultural land conversion. As the graphic above shows, Andhra Pradesh and Maharashtra are leaders in reforming the process of agricultural land conversion process, dispensing with the process itself.
AP repealed its Non-Agricultural Land Assessment Act 2006 in September 2025, and made conversion automatic, and also reduced the earlier 5% NALA fee to 2-3% external development charges (EDC). Maharashtra’s LRC Second Amendment Act 2025 further replaced it with a one-time premium capped at 0.5% of market value (graded down for smaller plots). Now, in both states, an agricultural land owner in an area master planned for a non-agricultural land use does not need to follow a separate process for agricultural land conversion, but only needs to pay the conversion charge at the layout/building permission stage to the local body.
This reform, however, needs a qualification. While Master Plans demarcate land use in urban areas, there is no similar land use plan for rural areas across the vast majority of India. There is, therefore, the risk of accelerated loss of prime agricultural land, environmental damage (e.g., drainage alterations and waterbody encroachment with flooding risks, groundwater depletion, etc.), and strain on rural infrastructure. The conversion process, with all its flaws, acted as a deliberate gate, an explicit review, that surfaced these factors.
Andhra Pradesh’s reform stands on firmer foundations insofar as the state has a Common Zoning Regulation covering lands even in rural areas. These rules establish a standardised approach to land use with a nine-fold zoning classification, a negative list of prohibited activities near residential and ecologically sensitive areas, and development control regulations. This is not true of most states, including Maharashtra, where the risks from such a reform are higher.
A fifth reform would be to eliminate a uniquely Indian land market distortion, the wedge between the market value of a land and its government-notified basic or guidance or ready reckoner value, below which registration cannot be done. This is the primary driver of black money and a source of tax evasion for sellers and laundering for buyers. Any reform to shrink the wedge will face resistance across society.
A measure of the wedge from a few cities is in the graphic below, though in some parts of cities like Delhi, it goes to multiples of 15-16.
Any reform of the wedge can only be done in a long-drawn, phased manner. One would be to target the phasing out of this wedge by committing to increasing the guidance or basic value annually by a fixed percentage over a ten-year period so that the wedge virtually disappears. For it to be meaningful and binding, such a commitment must be enshrined in a law passed by the state legislature.
An ambitious sixth reform could be to undertake a process of GIS-based cadastral survey of all land parcels, and linking their updation to the mutation process. This has been a sort of holy grail in land administration.
The Government of India has run multiple programs since the millennium to update survey records, with little to show for it. The latest SVAMITVA scheme drone-maps only abadi (inhabited village/habitation) land and issues property cards for houses, and excludes agricultural cadastre.
The standout pioneer in this again is Andhra Pradesh, with its comprehensive land resurvey scheme launched in 2020 using drones for a full ground-truthed re-survey. It involves subdividing parcels, fixing boundaries, resolving disputes, and updating both textual RoR and survey maps, with blockchain-secured pattadar passbooks issued. It has so far completed resurvey at 6,688 villages, with 26–32 lakh pattadar passbooks already issued. The remaining 9,365 villages with 68.6 lakh more passbooks are targeted to be completed by 2027.
This must count as one of the most outstanding plumbing achievements across any sector by any Indian state in recent years.
In conclusion, the policies undertaken by states like Andhra Pradesh show the path for reforms that address land market distortions. The only note of caution would be that these reforms should be accompanied by the creation of digital systems and documentation that ensure their successful implementation.
















