First Urban Land Title in India

"I am delighted to share with everybody that Guaranteed Land Title is now a reality in Rajasthan. Rajasthan is leading the country in its "second wave" of land reforms - land title security.

    Over the last two decades everybody has agreed that this is an important reform, must be done, etc. Yet nobody has actually done it until now - not because there is a political cost, but because it is so complex to implement.

    What we have in India today is a presumed ownership to land which is questionable and can be challenged on multiple fronts: ownership, extent of boundaries, clauses, financial encumbrances, inheritance sub-divisions, etc.
 
    On 8 October 2008 the Governor of Rajasthan signed the new Act for Guaranteed Land Title that effectively completes all processes on making this an official statute in Rajasthan and makes it the first state in the country to implement the legislation required to move this reform forward.
 
    The Chief Minister in her 2007 budget announced that they would undertake fundamental reforms related to land.  There were two aspects to the promise: one, that her government would complete the conversion of land ownership from leasehold to freehold during this financial year, and secondly, that they would also move towards the implementation of guaranteed land title in the state. 
 
    In her budget speech of 2008 she placed the legislation on freehold for land ownership in Rajasthan. With the enactment of the freehold act, Rajasthan caught up with many other states in the country.  Last week, in a special ordinance, after extensive debate and questioning, the Assembly members endorsed implementing the guaranteed title Act, complimenting the landmark initiative as a pioneering and progressive reform.
 
    Rajasthan in fact, will be the first state in India to undertake this most important reform - considered the world over as one of the central reforms for the development of any country or state.
 
    As the Advisor to the GoR on this reform, it has been a roller-coaster journey for me, with all the highs and lows and the screeching corners. This reform has had more lives than a cat in the last three years. But the most important aspect to the effort for me has been this - the "system" does respond. It pushes back hard on questions of value and delivery detail. It requires relentless advocacy but bottom-line, the system does respond. It validates our belief that in a democracy, it is possible for external energy to have positive impact.
 
 
Some defining features of what we are putting in place in Rajasthan are:

1. Addressing the challenges of urban land title first
2. Guaranteed land title is eligible only to owners that have converted land from leasehold to freehold. The process of actual issuance of freehold and guaranteed title will depend on the quality of the documents held by the owners - the clearer the documents, the easier the issuance of the freehold and title papers.
3. This is entirely a voluntary process.  Those who want to retain their land holdings in the current form can continue to do so. Letting market forces drive demand - demat of shares from paper to electronic is a good parallel.
4. Taking an incremental approach - get all government distributed land and developments under guaranteed title. Simultaneously incentivise private owners through tax rebates. Will this happen overnight? No it will take a decade or so.
5. Creation of a new Act for guaranteed land title instead of amendments in multiple acts
6. Mapping in complete detail the processes of transactions related to land title
7. Using technology as backbone to maintain records and manage the title system
8. Granting provisional title that over two years converts to indisputable title if unchallenged. A 1% DLC fee is charged that goes into an indemnity escrow.
9. Adopting a quasi-government institutional structure with independence but linked to government so that records management remains under the domain of government
10. Starting with a pilot of Jaipur, expanding to 11 other cities and then scaling.

    What do these land related reforms mean? There are millions of Indians whose only asset is their land, and millions more are doing everything they can to purchase the most important security for their family - a home.  So far, buying, selling or taking loans against these land holdings and properties, or passing on or dividing properties to children has meant enormous legal and procedural hassles for the average citizen. 

    Now, with these two acts of freehold and guaranteed land title, land and property ownership will become cheaper, safer and quicker for all Rajasthanis.  This reform benefits every Rajasthani - the middle class, the business community, but most importantly, the poor.  Because, for the first time, it will be possible for the poor to have the security of an indisputable title in their name for the property that they own. 

    Guaranteed title systems that protect rights to land and property have been developed in most of the democratic, developed economies. The essential aspect to guaranteed title is that it relates to so many aspects of the functioning of both state and markets: it helps in social justice programmes like low income housing; it helps in more effective urban planning, and in the protection of specified land parcels like environmental or heritage assets; it helps faster implementation of infrastructure projects, it reduces delays in judicial processes and unnecessary litigations; it helps in a more efficient mortgage market, with fewer delinquencies and greater transparency; and so on. 

    Why do industries or developers need government to acquire land? The central benefit is not cheap land but overcoming the nightmare of agglomeration of small fragmented parcels of land holdings that mean uncertainty over multiple land ownerships. What government acquisition does is to erase all past ownerships, litigations, disputes, and provide a newborn land parcel ready for urban use. If there were indisputable clarity on title it would facilitate direct dealing between the buyer and the sellers. 

    Hopefully Rajasthan's example will catalyse other states to follow suit."

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Swati Ramanathan is Co-Founder, Janaagraha. She is a member of the State Urban Agenda for Rajasthan (SUARAJ), initiated by the Chief Minister of that State. Swati is currently working on implementing Guaranteed Title in Rajasthan, a Heritage Plan for Jaipur city and a Heritage policy for Rajasthan. She is also anchoring the work on the Masterplan for Jaipur city, and creating an Urban Spatial Data Centre.