Maharashtra Sets Rules For Third Mumbai Land

The Maharashtra state cabinet has approved a structured land acquisition and allotment policy aimed at unlocking large-scale urban development in the proposed Third Mumbai region, marking a critical institutional step in the city’s eastward expansion. The decision brings long-awaited clarity to land procurement and compensation mechanisms near the Mumbai Trans Harbour Link, an area increasingly viewed as Mumbai’s next growth frontier.

Planners and market participants have long flagged the absence of a clear land framework as a key bottleneck for advancing infrastructure, housing, and employment clusters in the Third Mumbai zone. With the new policy in place, authorities now have a defined pathway to assemble land while balancing landowner participation, investor certainty, and long-term urban planning objectives. Under the approved framework, land can be secured either through negotiated agreements or statutory acquisition, with compensation structured to suit different parcel sizes and ownership patterns. Landowners are offered multiple settlement options, including built development potential, development rights, or direct monetary compensation. Notably, the policy mandates that a portion of developed land be returned to project-affected households, enabling them to remain stakeholders in the region’s future growth rather than passive recipients of one-time payouts.

Urban economists note that this approach reflects a shift away from purely extractive land acquisition models towards shared-value urbanisation. Smaller landholders, particularly those with fragmented plots, are protected through cash-based compensation where land return is impractical, reducing the risk of inequitable outcomes. A distinctive element of the policy is its treatment of large undeveloped land parcels through a pass-through allotment model. Under this structure, land is allocated on its existing condition, with acquisition and administrative costs transferred to the allottee. Infrastructure investments are phased, allowing public agencies to prioritise trunk infrastructure while avoiding immediate fiscal strain. Any future compensation revisions are recoverable from landholders, a provision designed to limit speculative delays and legal uncertainty.

The framework also aligns land allotment with investment-led development. Priority access is extended to investors committing substantial capital and time-bound execution, particularly in sectors linked to employment generation and economic diversification. However, outright land trading without development intent has been restricted, signalling a policy preference for productive urban use over speculative holding. Implementation responsibility rests primarily with the Mumbai Metropolitan Region Development Authority and a newly constituted town development authority, which will finalise pricing, allotment conditions, and a revenue model to fund supporting infrastructure. Senior officials indicated that the policy is designed to integrate transport, housing, and economic zones rather than encourage isolated real estate growth.

As Third Mumbai moves from concept to coordinated planning, the effectiveness of the land policy will be measured by how well it delivers inclusive growth, resilient infrastructure, and balanced urban expansion. The next phase will test whether regulatory clarity can translate into sustainable development outcomes across one of India’s most strategically located urban regions.

Maharashtra Sets Rules For Third Mumbai Land