Wed Feb 19 05:00:25 UTC 2025: ## Karnataka’s Small Businesses Demand Government Intervention Amidst Rising Land Costs

**Mysuru, Karnataka – February 19, 2025** – The Karnataka Small Scale Industries Association (KASSIA) is demanding urgent government intervention to address the escalating costs of industrial land, which is crippling small and micro enterprises (SMEs) in the state. KASSIA President M. G. Rajagopal, speaking at a press conference yesterday, highlighted the plight of SMEs struggling with unaffordable land prices and inadequate infrastructure.

KASSIA’s key demands include amendments to the Land Reforms Act to allow the Karnataka State Small Industries Development Corporation (KSSIDC) to directly acquire land. Alternatively, they propose that the Karnataka Industrial Areas Development Board (KIADB) allocate 30% of acquired land to KSSIDC at cost, without development fees. Rajagopal stated that the current system, where KIADB transfers land to KSSIDC at inflated rates, makes it impossible for KSSIDC to provide affordable land to MSMEs. He further pointed out that no land has been allocated to KSSIDC for the past two to three years.

The association also criticized KIADB’s practice of substantially increasing land rates after initial allotment, despite a 2018 government notification meant to regulate such increases. KASSIDC’s yearly revision of land rates based on government guidelines is also cited as a cause of financial distress for SMEs.

Beyond land acquisition, KASSIA is advocating for a separate labor policy tailored to the needs of SMEs, emphasizing their significant contribution to the state’s economy and the need for a minimum wage policy specifically addressing their unique circumstances. The association contends that the lack of basic facilities in privately owned industrial areas further exacerbates the difficulties faced by SMEs. The current situation, according to KASSIA, is forcing many SMEs to sell their plots and relocate to rented spaces.

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