Sunday, 8 March 2015

Daily News Mail - News of 07/03/2015

Private interest as public purpose

  • Next week the economic agenda of the Narendra Modi government will face its biggest test in Parliament. The controversial Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (Amendment) Bill, 2015 (LARR) that has been introduced in Lok Sabha is due for consideration of the house on March 9. While the government seems determined to push the Bill through Parliament, the opposition parties have vowed to oppose it tooth and nail(With every available resource; with unrelenting effort).
  • Over the years, farmers have lost 1.80 lakh hectares of farm land to acquisition. Many a time, land has been acquired for private companies under the guise(likeness) of public purpose. Recently, large tracts have been acquired for real-estate developers and the Special Economic Zones (SEZs). The companies have earned huge profits by diverting the acquired land toward commercial activities. Developers in Noida and Gurgaon have made fortunes.
  • A recent report of the Comptroller and Auditor General of India provides a damning account of misuse of land in SEZs. It concludes: “Land appears to be the most crucial and attractive component of the scheme. Out of 45635.63 ha of land notified in the country for SEZ purposes, operations commenced in only 28488.49 ha of land.” It further adds: “5402.22 ha of land was de-notified and diverted for commercial purposes in several cases. Many tracts of these lands were acquired invoking the ‘public purpose’ clause.” (Note: 1 hectare = 0.01 sq. km.)
  • The LARR Act, 2013 had put paid to such practices. It mandated prior consent of 80% of the affected families for land acquisition for private companies — 70% for PPPs. The consultative and participatory acquisition process under the Act drastically reduced the scope for arbitrary dispossession. Moreover, it made Rehabilitation and Resettlement (R&R) the legal right of the displaced and the livelihood losers.
  • By scrapping these progressive features, the Bill has legalised dispossession and displacement of people who depend on land, water and forests for their livelihood. It has added a large number of private projects to the exempted list for which land can be acquired without consulting the affected people, never mind their consent. In fact, several changes effected by it have made the acquisition law worse than the colonial Land Acquisition Act (LAA), 1894.
  • For instance, it has expanded the scope of SEZ-like malpractices by adding ‘Public-private partnerships’ (PPPs) to the exempted list. Ostensibly(apparently, seemingly), these partnerships are formed to tap private funds for the provisions of public goods. However, many of such partnerships are used as means to acquiring land for companies. This is how it works. The government concerned acquires land citing some public purpose and transfers it to the partner companies. Post-acquisition, companies use the land for real-estate and other commercial purposes to make huge profits. Housing projects under PPPs for the Taj and the Ganga expressway projects, and hospitality projects clubbed with Delhi and Mumbai airports are some of the many cases in point.
  • As if this was not enough, the Bill has abolished the social impact assessment (SIA) for many projects, including SEZs, PPPs, dams, power plants, and waterways. The SIA mandated under LARR, is vital to ensure that the acquisition happens only when it is in the social interest and excess land is not acquired. It also helps reduce the adverse effects of acquisition — in terms of the loss of livelihood and habitat, and damage to the environment. Its importance cannot be overemphasised for large projects.
  • To be meaningful the R&R requires careful documentation of those who lose their land and livelihood. Under the bill this can be done only as a part of the SIA, which stands scrapped for most projects. Consequently, R&R has been rendered to a mere charade. What a tribute to the Narmada Bachao Andolan!
Misleading claims
  • The government has sought to justify the Bill by attacking the LARR as anti-development. The Finance Minister, who is the architect of the ordinance, in his blog has criticised the land acquisition process under the Act as: “A highly complicated process of acquisition which renders it difficult or almost impossible to acquire land can hurt India’s development.”
  • Such claims are completely misleading. The LARR had been in place only for a year and there is no evidence suggesting that project delays increased during this period. On the contrary, data from the Ministry of Statistics and Programme Implementation show that more than 82 % of projects suffered delays even under the 1894 Act — the notorious ‘urgency clause’ under this colonial law permitted land acquisition without any scrutiny or hindrance whatsoever. Clearly, several factors other than land acquisition also cause delays.
  • Also, the government has made much of the increase in compensation; now, it can be two to four times the ‘market rates’. The corporate sector and its sympathiser claim that the increased compensation has rendered many projects unsustainable, threatening the growth prospects. Some UPA leaders also seem to share this view, which is totally baseless, since the officials assess market value using stamp-duty and the sale-deeds rates as proxy. Study of court cases shows, the latter rates are a fraction of the actual market prices. Therefore, even at two to four times the stamp-duty rates, the compensation will be less than the actual value.
  • The SIA and the R&R are crucial for ensuring that people get dispossessed and displaced when it is really worth it. Similarly, prior consent of the affected families is a necessary check on the misuse of the eminent domain power of the state. With these provisions absent, how can the bill be pro-farmer and pro-poor?

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