Dr Bharat Jhunjhunwala
The NDA-II Government is considering making amendments to the Land Acquisition Act that were enacted by the UPA Government. Rural Development Minister Nitin Gadkari reiterated this resolve after meeting with Revenue Ministers of the States recently. It is noteworthy that Mr Gadkari met the Revenue Ministers and not Farmer’s Organizations or intellectuals or social activists. The revenue machinery makes money in land acquisition. More acquisition the merrier for them. To hold consultation with them is like the Police Commissioner holding consultations about corruption with officers who are themselves corrupt.
Consent of 80 percent of the affected farmers was made mandatory for forced acquisition of the land of the dissenting 20 percent farmers in the Act amended by the UPA. The NDA Government wants to reduce this to 51 percent. It also proposes to do away with the requirement of making a Social Impact Assessment and holding a Public Hearing. In case of acquisition of agricultural land the present Act requires the authorities to certify that wasteland is not available. It is proposed to remove this requirement. The ostensible reason for these amendments is to speed up the acquisition process.
It seems the Chinese model is weighing upon the minds of the Government. Land in China is owned either by the Central Government or by Farmer’s Collectives. Mostly Collective’ land is being acquired by Local Governments for projects like housing colonies. The Local Government is required to pay price equal to the market price or up to 40 percent higher. Then Local Government auctions the land to prospective developers at maybe ten times the purchase price. This is possible because the Local Government changes the land use from agriculture to urban after acquisition. The Local Government makes a hefty profit in the process. Officials of the Communist Party dominate the Local Governments and they are often the major beneficiaries in their individual capacity. This process has aroused huge anger among the farmers. They feel cheated.
According to one report, five out of ten mass protests in 2010 happened over land acquisition. Over one thousand farmers from Suzhou City were angered by the acquisition process. They took over and ransacked the Tongan Township government building. Thousands of villagers were locked in a standoff with police for two weeks. In the end, the police forcibly regained control. In another incident the officials of Jiujiang City dispatched police cars to stop villagers of Dongxia Village from going to Beijing to protest against forced relocations. Bus drivers were told not to board the villagers. About 100 villagers walked 50 kilometers to take another route to Beijing. Local police then sent 30 police vehicles to intercept the villagers and returned them to the township hall. The negotiations did not take place though. Thousands of angered citizens then smashed the windows of the township government building and 18 police cars were damaged by stones and bricks. Many similar instances are ever happening.
NDA-II Government must recognize that such brutal suppression is not possible in India. The opposition will pounce on it. The results of recent by-elections in which BJP has faced a massive uprooting is a warning. China is ruled by the Communist Party with a iron hand. Dissent can be crushed there, not here. The Government should not forget the NDA-I experience. The Government lost power despite commendable work on the IT sector, Golden Quadrangle and nuclear explosions because it did not care for the poor. I had interviewed Finance Minister Yashwant Sinha then and asked him about the impact of his policies regarding FDI etc. on the people. He evaded the questions saying the Government was studying these. The result was the people evaded the NDA!
There are some positive features of the Chinese procedure. Acquisition of agricultural land has to be approved by the State Council so that unnecessary acquisitions do not jeopardize the food security of the country. Our Act has a similar provision in requiring the authorities to certify that wasteland on which the project could be implemented is not available. This needs to be strengthened. A mere certificate is not sufficient. The Standing Committee of our Parliament had recommended that “a strong law is required to protect prime agricultural land in similar manner as forest land.” Diversion of forest land for non-forest purposes is very difficult in India because permission of the Ministry of Environment and Forests is required. A similar provision in respect of cultivable land can be enacted.
The Chinese procedure requires the purchaser to make public a feasibility report of the proposed project. This is similar to the requirement of a Social Impact Assessment that is built in our Act. This provision must be expanded to present a cost-benefit analysis of the complete project so that the public can scrutinize whether the project is beneficial for the people at all. The Chinese procedure requires the Local Government to auction the acquired land to the highest bidder. This leads to the Government getting higher price. A similar procedure of auction of the project may be built in our Act.
Complaint of the industrialists is that acquisition under the present Act takes a long time. Indeed this is too long. But underlying factor is that of cost. For example, 80 percent of the farmers may be willing to consent if a price of Rs 25 lacs per acre was given. Delay takes place if the project proponent wants to whittle down the farmers to, say, Rs 10 lacs per acre. I know of a hydropower company that did not invoke the land acquisition process at all. It simply paid the best price that it could negotiate with the landowners. There was no delay! Similarly the change of definition of “affected” person is only a matter of cost. Inclusion of tenants only raises the cost of acquisition. The restriction on acquisition of farmland also translates into cost. Making a steel mill tens of kilometers away on wasteland would increase the cost. So the real problem is not the so-called “obstructions” made by the Act. The problem is simply that businesses find the cost of land escalating.
Mr Gadkari is known for working through the maze of government regulations and revamping the urban road transport system in Maharashtra. He should use that same skill to work out systems to speedily implement the provisions of the present laws instead of dismantling them. A Social Impact Assessment can be done in three months; and Gram Panchayats can be called to meet in a month’s time. Dismantling these provision under the guise of delay is like the doctor stopping administration of medicine because the patient is taking time in responding!
(The author was formerly Professor of Economics at IIM Bengaluru)
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