New Policies by Local Self-Government Department Give the Green Light for Entrepreneurship at Home

The Local Self-Government Department has issued new guidelines allowing enterprises to operate from residential buildings that have received approved numbers from Panchayats. Licenses will now be granted to enterprises falling under the White and Green categories of the Pollution Control Board, regardless of the occupancy restrictions in the Building Construction Rules.

This policy, framed under the Kerala Panchayat Raj Act (Grant of Licenses to Enterprises) Rules, is part of the state’s industry-friendly initiatives and is expected to benefit many aspiring entrepreneurs. The order has been issued, and the rules will come into force upon notification. However, the exemption does not apply to apartments, residential flats, lodges, tourist homes, resorts, hostels, and similar establishments.

The Pollution Control Board has listed 136 White-category enterprises, including soap manufacturing, small restaurants, chapati production units, shoe manufacturing, cardboard and paper products, medical oxygen units, and Akshaya or e-service centers. The Green-category list comprises 201 enterprises such as automobile workshops, egg packing centers, bakeries, sweet shops, coir product units, cold storage facilities, food processing units, flour mills, furniture manufacturing, Ayurvedic and Unani medicine production units, timber mills, beauty parlors, and catering services.

For enterprises not included in the Pollution Control Board’s list, officials will inspect and classify them based on their pollution levels. Previously, there was no provision for granting licenses to cottage industries and other commercial services operating from homes. The policy aims to resolve the challenges faced by many small-scale entrepreneurs who were unable to access such benefits.

Under the new rules, if a house is unoccupied, the entire building may be used for industrial purposes. In occupied houses, up to 50% of the space can be allocated for the enterprise. This step is expected to give further momentum to the growing MSME sector in the state.

Official Order: