Odisha Amends Town Planning Rules to Boost Industrial Growth and Ease of Doing Business

Bhubaneswar: To enhance industrial growth and ease of doing business, the Odisha government has amended key building regulations to benefit MSMEs, IT/ITeS enterprises, and large-scale commercial developments. The Department of Housing and Urban Development notified crucial amendments to the Odisha Town Planning and Improvement Trust (Planning and Building Standards) Rules, 2021 and the Odisha Development Authorities (Planning and Building Standards) Rules, 2020 through Notification Nos. 467 and 468, dated February 21, 2025.

These amendments aim to provide greater economic freedom by relaxing restrictions on ground coverage, reducing parking and setback requirements, and increasing the base Floor Area Ratio (FAR) for industrial and IT/ITeS developments. The reforms will allow plotted and flatted factories to achieve over 70% footprint, enable flatted factories to accommodate twice the number of units as before, and facilitate IT/ITeS enterprises to build more within fewer floors.

To encourage large-scale commercial development, additional FAR incentives have been introduced for projects located along roads wider than 18 meters (60 feet). Furthermore, all industrial buildings will no longer be subject to restrictions on ground coverage, nor will they require purchasable FAR or Transferable Development Rights (TDR). Parking requirements for industrial buildings have also been significantly reduced from 30% to 8%, allowing for more efficient land use.

The amendments align with recommendations from the Economic Survey 2024-25, which emphasized the need to enhance economic freedom for individuals and small businesses. The survey had pointed out that Odisha faced higher land loss per factory due to restrictive building norms compared to other states, advocating for regulatory reforms to reduce compliance burdens and drive economic growth.

Speaking on the reforms, Odisha Chief Secretary Manoj Ahuja stated, “Deregulation is an idea whose time has come. These regulatory changes will promote ease of doing business, foster innovation, and position Odisha as a competitive industrial hub. We are committed to transforming the state’s role from a regulator to a facilitator, creating a more business-friendly environment.”

Principal Secretary of Housing and Urban Development, Usha Padhee, emphasized the need for adaptive governance, saying, “We are incorporating global best practices while tailoring them to local contexts through participatory decision-making. These amendments will streamline bureaucratic processes, reduce hurdles, and stimulate industrial and economic activity.”

A major beneficiary of these reforms will be the MSME sector, which will see a 60% reduction in land lost to building standards, fostering job creation and economic expansion. With these changes, Odisha is now at the forefront of industrial land optimization, ensuring ease of operations for entrepreneurs, startups, and global investors.