In a fresh setback to Punjab’s Farm Stay Policy, 2026, the state government is set to exclude areas covered by approved master plans and land falling within 10 km of municipal limits, potentially restricting the policy’s reach across large parts of the state.
The latest proposal, discussed at a meeting between the housing and urban development department and the tourism department in the first week of October, has been forwarded to the chief minister’s office for final approval, officials said.
Introduced in May, the policy aims at promoting rural tourism, diversifying farmers’ income and offering visitors immersive rural experiences. Our primary objective is to promote tourism in rural areas. The official added that the policy could be misused to construct farmhouses for subsequent sale as real estate properties rather than to promote genuine rural tourism. If approved, the restrictions could leave prospective applicants with fewer locations to establish farm stays. The latest move comes less than a month after the government amended the policy following NGT proceedings. The proposed curbs have also raised concerns among prospective applicants.
“At the meeting, it was decided to keep areas covered by approved master plans and the 10-km belt around municipal limits outside the policy’s ambit. However, it has received 35 applications so far, of which 21 have been approved, 12 are pending and two have been rejected, according to departmental figures. The proposed 10-km exclusion could further narrow the policy’s reach. Punjab has 105 urban local bodies, comprising eight municipal corporations, 76 municipal councils and 21 nagar panchayats. In an affidavit filed on September 16, the state told the tribunal that it had made changes in compliance with its July 24 order. The government also revised electricity provisions, specifying domestic tariff rates subject to notification by the competent authorities, and deleted notes under Clauses 3.2(2) and 8.2.1. The remaining provisions of the policy, notified on May 6, continue to remain in force.
Because the proposed site fell within a master-planned area, said further exclusions could make the policy less attractive, raman Khanna, a Mohali resident whose application was rejected.
Allowing farm stays in master-planned areas could defeat the purpose of planned development, as two different policy frameworks cannot operate simultaneously in the same area,” a senior tourism department official said.
