Gujarat Revises Land Compensation Policy for Electricity Transmission Towers and Power Lines in 2026

Key Facts

• The revised policy, effective from 2026, applies to farmers whose land is used for electricity transmission towers and overhead power line corridors, including projects already under execution.
• Compensation is fixed at twice the prevailing market value of the land, replacing the previous jantri value-based system. Jantri values are official government circle rates which often lag behind actual market prices.
• A Market Rate Committee (MRC) is established for transparent land valuation. Its members include the District Collector, representatives of affected landowners, a farmer-nominated authorised market valuer, and representatives of the transmission service provider.
• For Right of Way corridors, compensation rates are differentiated by area type: farmers in rural areas receive 30% of the market value, those in municipal areas 45%, and those in municipal corporation areas 60%.
• The land area considered for tower base compensation has been increased by one metre on each of the four sides, increasing the total compensable area — for example, raising it from 625 square metres to 729 square metres for 765 kV transmission towers.
• Previously, compensation payments were staggered in three instalments (40% during foundation, 40% during tower erection, 20% after stringing lines). The policy now mandates 100% compensation paid upfront before work starts.
• The revised compensation policy also applies retrospectively to projects where compensation was determined under previous rates but where construction is ongoing.

Background & Context

Prior to this policy revision, Gujarat compensated farmers using jantri rates, official circle rates that often underrepresented true market prices. The compensation was at 200% of jantri rates but was paid in instalments over the project's timeline, potentially causing financial strain for farmers. Persistent farmer protests and representations prompted the government, led by Chief Minister Bhupendra Patel, along with relevant ministers, to consult with various stakeholders and formulate a policy that aligns compensation more closely with actual land market values while ensuring prompt payment and transparency.

Why This Matters for Exams / Exam Relevance

This case demonstrates a significant example of land acquisition policy reform at the state level, highlighting efforts to balance infrastructure development with farmers’ rights and compensation fairness. It is particularly relevant for exams covering Indian land laws, agricultural policy, rural development, and energy infrastructure. Understanding the specifics of the compensation formula, institutional mechanisms like the Market Rate Committee, and differentiated RoW payments provides insights into governance and socio-economic policy responses to farmer concerns.

Points to Remember

• The revision year is 2026 under Gujarat's Chief Minister Bhupendra Patel.
• Compensation formula changed from 200% of jantri rate to 200% (twice) the prevailing market value.
• The Market Rate Committee ensures inclusive valuation with farmer and official participation.
• Right of Way corridor compensation rates: 30% (rural), 45% (municipal), and 60% (municipal corporation) of market value.
• Compensable tower base area increases by 1 metre on all sides; e.g., 765 kV tower base expands from 625 m² to 729 m².
• Compensation payments are fully made upfront instead of being phased over project stages.
• Policy applies to ongoing projects, allowing farmers to benefit retroactively.
• ‘Jantri’ indicates earlier benchmark property values used in Gujarat before the shift to market value-based compensation.