Will the new Land Acquisition Bill make protests like those in Singur and Bhatta-Parsaul a thing of the past? Will it make land acquisition so expensive and difficult that the pace of industrialisation will suffer? Will it achieve justice? Development? Neither? Experts from academia and industry examine a piece of legislation that is likely to have far reaching consequences for the future of the country.
The last decade has witnessed increasing unrest over land acquisition all over the country. The colonial era Land Acquisition Act of 1894 still serves as the legal basis for eminent domain, a few minor amendments notwithstanding. For the last two years, the UPA II government has been preparing to introduce a new Land Acquisition Bill in parliament. The Bill, initially drafted by the National Advisory Council, seems to have evolved quite a bit as it passed through the Cabinet, standing committee, and consultation with opposition parties. While details may yet change, some broad features will probably remain:
- Compensation to landowners must be a multiple of the local market price for land, as determined by the collector from recent sale deeds and circle rates. The multiplication factor has been changed several times and latest documents indicate it will be two times in urban areas and three times in rural areas (including the 100% solatium). Since the current law requires compensation to equal market price, this is a significant increase.
- Landowners as well as livelihood losers – families who earned their living from the land being acquired such as sharecroppers and agricultural labourers – are entitled to a relief and rehabilitation (R&R) package. The package consists of lump sum payments as well as other benefits, such as employment and land-for-land in the case of “urban development” projects. Industries are obligated to pay R&R even if they buy land through the market whenever the total acquisition is above a certain size.
- Tougher procedural requirements will come into effect if the Bill becomes law. For example, “social impact assessment” has to be carried out by government committees before acquisition can go ahead. When private industries or PPP (public-private-partnership) projects acquire land above a minimum size, consent of at least 80% of the affected population will be required.
- Taken at face value, the Bill attempts to restrict eminent domain to projects with a “public purpose”. It also makes noises about limiting the acquisition of multi-cropped land for reasons of food security but choice of ceilings will probably be left to states. Existing law has similar restrictions but in practice, they are rendered weak by provisions like the “urgency clause”, which have been used quite liberally. Whether the restrictions in the new Bill will have more bite is a debatable issue.
A copy of the Bill can be downloaded from the Ministry of Rural Development’s website (http://rural.nic.in/sites/downloads/general/LS%20Version%20of%20LARR%20%20Bill.pdf). However, this is an older version, which has undergone revisions and amendments.
Will the new Land Acquisition Bill make protests like those in Singur and Bhatta-Parsaul a thing of the past? Will it make land acquisition so expensive and difficult that the pace of industrialisation will suffer? Will it achieve justice? Development? Neither? Our panellists (listed below) examine a piece of legislation that is likely to have far reaching consequences for the future of the country.
Pranab Bardhan is a professor of economics at the University of California at Berkeley, USA. His research is focused on economic development. Bardhan contributes regularly to various Indian newspapers on matters related to public policy, including the problem of land acquisition.
Shrivallabh Goyal is a Senior Vice President at Reliance Industries Ltd. He presents the industry perspective in our e-debate. Goyal has spoken on the issue at many seminars and symposia.
Dilip Mookherjee is a professor of economics at Boston University, USA. He has published theoretical and empirical research on the problems of land markets in India. Mookherjee has conducted extensive field surveys in the Singur region of West Bengal, where Tata’s proposed car factory got stalled due to protests over land acquisition.
Abhirup Sarkar is a professor of economics at the Indian Statistical Institute, Kolkata. His articles on land acquisition, especially in the context of West Bengal, have appeared in outlets such as Economic and Political Weekly and Anandabazar Patrika. Sarkar is also the Vice-Chairman of the West Bengal Industrial Development Corporation (WBIDC), in which capacity he has acquired a policymaker’s perspective on how land scarcity affects industrialisation.
In the last several years, attempts to acquire agricultural land for development projects have triggered protests and violence all over the country. The resistance seems to cut across states, ruling parties and the nature of projects (whether infrastructure or industry, mining or education, private, public or PPP). In your view, what are the endemic flaws in our current law and practice regarding land acquisition?