Authorities are preparing to revise guidance value calculation methods by formally including utility penetration metrics, reflecting a shift toward infrastructure-driven land valuation. Traditionally, guidance values for industrial and commercial land were based largely on location, land use classification, and historical market trends. Now, factors such as availability and quality of electricity, water, gas pipelines, sewage systems, and broadband connectivity will directly influence official land rates. Parcels with full utility access are expected to command higher guidance values compared to partially serviced or unserviced lands. This reform aims to better align official valuations with real-world market preferences, where utility readiness plays a critical role in investment decisions. It marks a significant evolution toward more transparent, dynamic, and infrastructure-linked land pricing models.
The new approach will involve detailed mapping and rating of utility services across industrial and commercial belts, using standardized criteria developed by planning and infrastructure authorities. Factors such as proximity to substations, daily water supply capacity, fiber optic network access, and waste management readiness will be weighted to generate a utility penetration score. This score will then be factored into the land’s base guidance value calculation. Experts believe the move will help eliminate distortions where poorly serviced land parcels were previously overvalued relative to better-prepared locations. It will also incentivize developers and local bodies to invest more proactively in infrastructure improvements to boost land value. Financial institutions and investors have welcomed the change, expecting it to reduce valuation mismatches and enhance risk assessment.
Looking ahead, states plan to update utility penetration metrics periodically, ensuring that guidance values remain current as infrastructure evolves over time. Digital platforms and GIS-based land information systems will be leveraged to maintain real-time data on utility availability and quality. Analysts predict that over the next few years, utility penetration will become one of the top three criteria influencing industrial and commercial land values, alongside location and regulatory approvals. Policymakers see this shift as essential to supporting sustainable industrialization, balanced regional growth, and improved land market transparency. Ultimately, factoring utility readiness into guidance values will create a more efficient, equitable, and investor-friendly land ecosystem. This modernization effort is expected to set new benchmarks for land valuation practices nationwide.