Many states in India have introduced online land records portals, allowing prospective land buyers to access information about property ownership. However, the accuracy and completeness of cadastral drawings, transaction histories, and co-ownership details (patta) remain uncertain. The newly appointed president of the National Real Estate Development Council, G Hari Babu, has made it a top priority to address these issues, shedding light on a long-standing problem.
India’s efforts to digitize land records have been inconsistent and primarily focused on converting analog records to digital formats. While this is a crucial initial step, significant challenges persist.
The Digital India Land Records Modernization Program (DILRMP) was initiated by the Indian government in August 2008, with some states, including Karnataka and Maharashtra, launching land records portals. However, issues such as incomplete cadastral drawings, inadequate transaction histories, and unresolved co-ownership situations continue to plague the system.
Co-owners, including minors, can raise objections to land sales when they come of age, further complicating the process. An example from a developer in Bengaluru illustrates this challenge, as a land purchase made nearly a decade ago faced complications due to a co-owner who had reached adulthood.
Despite the need for secure land titles, title insurance is primarily designed to protect lenders and homebuyers from financial losses related to property title defects, leaving many property owners exposed to potential issues.
An additional flaw in India’s digitization process is the lack of an automatic link between the registration of new property owners and digital records. This means that updates to land ownership information are not automatically reflected in digital records.
The National Real Estate Development Council (Naredco) has initiated a pilot project in collaboration with a Mumbai-based law institute to address these challenges. The project, funded at Rs 35 lakh, involves five law students conducting in-depth research into land titles, historical records, and potential disputes. Retired judges and policy experts are also contributing to the effort, suggesting amendments to state and national laws to make land titles dispute-free.
Historically, land records in India have been maintained in various forms, requiring a comprehensive examination of ownership history and the resolution of contentious issues. The pilot project aims to present its findings and recommendations to the Ministry of Housing and Urban Development, potentially influencing changes in digitization policies.
Notably, it is the real estate industry, particularly builders, that has taken the lead in addressing this issue. Land, as a raw material for development, is crucial to their operations. Currently, land prices in India are at an all-time high, making the matter even more urgent. However, the lack of formal declarations of land values and the prevalence of cash transactions have deterred stock market investors from engaging with the sector.
The real estate industry, which now includes well-established companies from the consumer durables and manufacturing sectors, must resolve the land title issue to operate transparently and efficiently. This is essential for the industry’s continued growth, as it already contributes significantly to the country’s GDP. According to the Knight Frank-Naredco real estate report, the sector is projected to contribute $5.8 trillion by 2047. Therefore, addressing fundamental issues surrounding land titles is of utmost importance.