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Land records: Why Budget 2022-23 announcements are critical

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Land records facilitate a favourable business climate and a competitive land/residential market, provided correct information on key aspects of land is available. India has been making efforts to manage and digitise land records since the late-1980s. However, several gaps still exist, meriting greater attention and action. Considering these needs, there seems to be a push towards improving land records in Budget 2022-32.

In 2008, the central government had launched the National Land Records Modernisation Programme. This programme was revamped in 2014 under the Digital India initiative as the Digital Land Records Modernisation Programme (DI-LRMP). The programme and its revamped version aimed to achieve an accurate and comprehensive land records system in India.

States have been making progress in digitising land records under DI-LRMP. However, there is much ground to cover when it comes to accuracy of records. This was brought out by the joint pilot impact assessment of the programme by the National Council of Applied Economic Research (NCAER), Indira Gandhi Institute of Development Research, and National Institute of Public Finance and Policy for Himachal Pradesh, Rajasthan, and Maharashtra. For instance, fieldwork for the selected land parcels in one of the tehsils in Himachal Pradesh exhibited a 34% variation between the on-the-ground situation and the online records about land ownership.

Taking off from this base of learnings developed from the pilot assessment, NCAER developed India’s first Land Records and Services in India (N-LRSI) index in 2020. Two rounds of exercise since then highlight the difference in pace at which the improvements in digitisation and quality of land records are happening.

Between NLRSI-2020 and NLRSI 2021, the extent of digitisation of land records improved by 20%; however, the quality improvement did not match the pace, showing an increment of 8.6%. This clearly underscores the need to address the intrinsic problems with the land records system in India.

In this regard, some of the announcements made under Budget 2022-23 are welcome.

The use of kisan drones for digitising land records can help limit land area/boundaries variation between land records and the on-ground situation. Drones have been instrumental in providing accurate land records, and are a crucial driver of the SVAMITVA scheme that sought to create property records for inhabited parts of rural areas. However, it would be useful if the kisan drone initiative also seeks to set in place a redressal mechanism to address any complaints regarding variations arising in the drone-mapping process.

A plan for ‘One Nation One Registration Software’ has been announced, which is proposed to be embedded in the already existing National Generic Document Registration System (NGDRS).

NGDRS has already been rolled out in around 12 States/UTs such as Maharashtra, Punjab, and Jharkhand and assists with property registrations, including processes like online property registration and uploading of relevant documents and booking online appointments with the SRO for documents registration.

Administered by the department of land resources, ministry of rural development, NGDRS is a common, generic, and configurable application developed for registration departments of states across India. This move seeks to ensure a uniform process for registration and “anywhere registration” of deeds and documents. This announcement is expected to provide a transparent and centralised registration process and remove the registration barriers across states, potentially enabling enhancement in overall property transaction intensity.

While the standardisation is welcome, it is essential to prepare a plan for compensating states if there is any revenue loss in stamp duty and registration fee collection. In addition, policies would have to be designed to ensure states’ share in the central revenue collection to facilitate the improved state-level infrastructure for land record management akin to the Goods and Services Tax framework.

Finally, the budget announcement proposes to adopt the Unique Land Parcel Identification Number (ULPIN) to digitise land records and link this number with Aadhaar.

This linkage is an important step towards ensuring the accuracy of land records and it will put a check on fraudulent transactions. In addition, the budget has proposed a plan to offer a transliteration facility across any of Schedule VIII languages. This is a welcome move, as the availability of land records in regional languages is a significant impediment for potential investments or transactions across states.

This was also a vital suggestion that had been put forth to improve the accessibility of records under NLRSI 2021 exercise, given how none of the States/UTs in the country presently have land records in more than one language.

Overall, the 2022-23 Budget reflects the government’s recognition to improve the quality of land records, transparency in registration processes, standardisation in registration processes, and ensuring accessibility. Addressing these factors will go a long way in easing land transaction intensity, often seen as a big hurdle in the Indian market by potential investors.

However, implementation of these policies would require close coordination between the central government and local administration at the state level to ensure their effectiveness.

Prerna Prabhakar is an associate fellow, National Council of Applied Economic Research

The views expressed in this article are personal.

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