Rajasthan Makes Agricultural Land Conversion Mandatory for RE Projects

The Rajasthan government has made conversion of agricultural land for non-agricultural use mandatory for renewable energy projects, withdrawing the earlier provision that allowed developers to establish solar and other renewable energy projects on agricultural land without obtaining formal land-use conversion permission.

The revised framework covers solar farms and power plants, wind farms, biomass-based power plants, biomass gasifier projects, biogas and bio-CNG/compressed biogas (CBG) projects, hydropower projects, pumped storage projects (PSPs), battery energy storage systems (BESS) and pooling substations for renewable energy projects.

The changes are part of the Rajasthan Land Revenue (Use of Agricultural Land for Non-agricultural Purposes in Rural Areas) Rules, 2026, notified by the state’s Revenue Department on September 29, 2026. The rules came into effect on November 2, 2026, replacing the earlier framework governing conversion of agricultural land in rural areas.

Under the new provisions, landowners seeking to use agricultural land for renewable energy projects must submit an online application to the concerned sub-divisional officer (SDO), along with the prescribed documents and details of the land. The revised system provides for online processing and generation of conversion permission upon submission of a complete application and payment of the applicable self-assessed premium, followed by verification by the authorities.

The revised rules mark a departure from the arrangement introduced in 2014 under the then Vasundhara Raje-led government, which allowed solar project developers and landowners to retain agricultural land classification. Under the earlier provision, conversion was optional and was generally sought when required for specific purposes, such as obtaining bank loans, as financial institutions were often reluctant to extend financing against agricultural land for industrial or infrastructure projects.

The state government has exempted renewable energy projects from land conversion charges, which are otherwise calculated at 0.5 percent of the District Level Committee (DLC) rate. The exemption removes the direct conversion fee burden, but developers will still have to complete the prescribed application and documentation requirements.

The new framework also introduces stricter provisions for unauthorised use of agricultural land for non-agricultural purposes. Violations can attract penalties of up to four times the applicable prescribed premium.

Industry participants have raised concerns that mandatory conversion could increase procedural requirements, complicate land aggregation and affect project implementation schedules. The change could particularly affect farmers who lease barren or unproductive agricultural land to renewable energy developers. Such arrangements may now require additional documentation and compliance before the land can be used for project development.

Rajasthan is among India's leading renewable energy markets, with substantial solar and wind power potential. The revised land-use requirements could therefore have implications for developers planning new projects in the state, particularly those dependent on leasing large parcels of agricultural land.

The impact of the changes will depend on the efficiency of the online application and verification process and the time taken to complete land-use formalities.