Bengaluru Business Corridor: Progress or Predation? The 35% Land Return Clause Unravels a 20-Year-Old Wound 

The Bengaluru Business Corridor, a ₹27,000-crore project formerly known as the Peripheral Ring Road, has sparked significant backlash from landowners due to a revised compensation plan that operates under the older BDA Act of 1976, deliberately bypassing the more protective LARR Act of 2013.

This move denies them enhanced compensation, rehabilitation, and legal safeguards, with the central point of contention being a confusing “35% developed land return” clause, which landowners reject as it forces them to surrender 65% of their property with no guarantees on the location, value, or timeline for the returned fraction.

They argue the project has shifted from public infrastructure to a commercial real estate venture, a concern compounded by the imposition of a “Betterment Tax” on nearby properties, creating a “double penalty” for those already losing land and highlighting a profound lack of transparency, accountability, and fair participation in the planning process.

Bengaluru Business Corridor: Progress or Predation? The 35% Land Return Clause Unravels a 20-Year-Old Wound 

Meta Description: A deep dive into the Bengaluru Business Corridor reveals why landowners are rejecting the 35% land return clause and how a ₹27,000-crore public project became a battleground over fair compensation, transparency, and the very soul of urban development. 

Introduction: A Road by Any Other Name 

For two decades, it was known as the Peripheral Ring Road (PRR)—a promised artery designed to decongest Bengaluru’s choking traffic, a blueprint of hope in a city buckling under its own growth. Today, that hope has curdled into resentment. Rebranded as the Bengaluru Business Corridor (BBC), this ₹27,000-crore, 2,560-acre project is no longer just an infrastructure plan; it is a litmus test for justice, accountability, and the rights of citizens in the face of state power. 

A revised government order on October 17, 2025, has ignited fresh outrage, not for its ambition, but for its fine print. At the heart of the controversy lies a seemingly generous offer: a 35% land return clause. But for the farmers and landowners whose properties have been frozen in legal and administrative limbo for nearly 20 years, this clause is not a solution. It is the core of a deeply flawed deal that privileges commercial interests over community welfare and raises a fundamental question: who is city-building truly for? 

The Anatomy of the Deal: Decoding the 35% Clause and Its Discontents 

The government’s compensation package presents multiple options: a cash payout, Transferable Development Rights (TDR), additional Floor Area Ratio (FAR), or the return of 35% of the acquired land as “developed” plots. On the surface, choice implies empowerment. In reality, each option is fraught with uncertainty, and the 35% land return is the most contentious. 

The Mathematical and Emotional Deficit 

Imagine a family that owns four acres of ancestral farmland. Under this scheme, they would surrender approximately 2.6 acres and receive back 1.4 acres. The immediate loss is stark. But the deeper anxiety is about value. 

“If we lose 65% of our land, what guarantee do we have that the remaining 35% will hold the same value?” asks a farmer from Hennur, voicing a concern echoed across the project’s path. Land value isn’t just about square footage; it’s about utility, accessibility, and heritage. A fragmented plot, potentially marooned in a massive commercial development, may be rendered useless for agriculture or even practical resale. The “development” promised—roads, utilities, etc.—is the same development that makes the remaining 65% of their former property astronomically valuable for the government and its private partners. Landowners are being asked to fund their own compensation with the very asset being taken from them. 

The Spectre of the “Developed” Plot 

The devil, as always, is in the details. The government order offers no clarity on: 

• Location: Where will this 35% be returned? Will it be a prime, accessible piece of land, or a leftover, inaccessible parcel tucked behind a mall? 

• Timeline: When will it be returned? Given the 20-year delay so far, promises without deadlines are viewed with justifiable scepticism. 

• Quality of Development: What does “developed” mean? A basic plot with a mud road or one with full civic amenities? 

Without these guarantees, the 35% offer is not an asset; it’s a speculative voucher, a promise that has, for two decades, been consistently broken. 

The Legal Labyrinth: Why the BDA Act of 1976 is a Step Backwards 

The most alarming aspect of the October 17 order is its deliberate sidestepping of a landmark law: the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (LARR) Act, 2013. 

Widely hailed as a progressive piece of legislation, the LARR Act was born from decades of struggle by India’s displaced. It mandates: 

• Enhanced Compensation: A calculation based on multiples of market value. 

• Rehabilitation & Resettlement: Comprehensive packages including housing, jobs, and amenities. 

• Social Impact Assessment: A mandatory study to understand the project’s full human cost. 

• Lapse Clause: If the acquired land is not used for its stated purpose within five years, it must be returned to the original owner. 

The government, however, is invoking a 2022 Supreme Court ruling to proceed under the older, more draconian BDA Act, 1976. This move is a legal sleight of hand that strips landowners of every protection the LARR Act affords. There will be no enhanced compensation, no rehabilitation, and no right to reclaim their land if the project stalls again. For families who have watched their asset appreciate in value while being unable to sell, mortgage, or develop it, this is not just unfair; it feels like a state-sanctioned expropriation. 

From Public Road to Private Venture: The “Business Corridor” Rebrand 

The name change from “Peripheral Ring Road” to “Bengaluru Business Corridor” is more than a rebranding exercise; it is a mission statement. The project’s revised design allocates 65 metres for the road itself and a whopping 35 metres on either side for commercial development. This commercial real estate, the government argues, is necessary to fund the compensation. 

This model fundamentally alters the project’s character. It is no longer a pure public infrastructure project but a public-private real estate venture. The primary beneficiary shifts from the commuting public to the developers and corporations who will build and profit from the commercial zones. 

Landowners rightly allege that their sacrifice is being used to bankroll a lucrative business model from which they are largely excluded. They are being treated not as stakeholders in the city’s future, but as obstacles to be cleared with a minimal, cost-effective payout. The demand for inclusion in the project’s equity structure is a direct response to this—a plea to be partners, not pawns. 

The Double Penalty: The “Betterment Tax” and the Erosion of Trust 

Adding insult to injury is the notification of a 500-metre ‘impact zone’ on both sides of the corridor. Property owners within this zone—many of whom are not losing land to the project itself—will be liable to pay a Betterment Tax under the BDA Act. 

The logic is that their property values will skyrocket due to the new road, so they should contribute to its cost. However, for those within this zone who are losing their land, this is a “double penalty.” They are first compelled to surrender their primary asset at a below-market rate, and then taxed for the perceived increase in value of the property they no longer fully own. This punitive approach erodes any remaining trust in the government’s intentions, painting the project as revenue extraction rather than public service. 

The Path Forward: A Call for Participatory Planning 

The government’s top-down approach, bypassing the mandated Metropolitan Planning Committee (MPC) and public consultation, violates the spirit of cooperative federalism and participatory urban planning enshrined in the Constitution (Articles 243ZE and 300A). 

Landowners are not Luddites opposing progress. They are citizens demanding a seat at the table. Their demands are reasonable: 

• An MPC Review: To bring democratic oversight and regional planning perspective to the project. 

• Fair-Market Compensation: Aligned with the principles of the LARR Act, 2013. 

• Clarity and Guarantees: A legally binding framework for the 35% land return, specifying location, timeline, and development standards. 

• Stakeholder Equity: A model that allows landowners to share in the long-term prosperity the corridor will generate. 

Conclusion: The Soul of a City at a Crossroads 

The Bengaluru Business Corridor stands at a crossroads, much like the city it aims to serve. One path leads to a future where development is a brutal, transactional process that dispossesses the vulnerable for the benefit of a powerful few. The other path embraces development as a collaborative, just, and humane endeavour that respects the rights of those who form the bedrock of the city. 

The 35% land return clause is more than a contractual term; it is a symbol of this choice. By addressing the genuine, human concerns behind the landowners’ rejection, the government has an opportunity to build not just a road, but a legacy of trust and inclusive growth. The true cost of the Bengaluru Business Corridor will not be measured in crores, but in the justice it delivers to the people whose land will pave its way.