Sunday, June 12, 2011

Land Acquisition - Some solutions

It looks like suddenly the whole country is erupting with agitations against land acquisition by either government or for private projects. This phenomena is probably a result of increased awareness among the affected added with local/National NGO’s standing with them in their struggle.

However there is one point which we need to consider, land is required for development be it either industrial growth or for infrastructure creation. Without land, how do we ensure projects are implemented. We have seen many a project getting delayed simply due to road blocks that are created in securing the land required for projects like national highways and still there are many stretches across India where four lane highways become two way due to legal hurdles in taking over the land on one side.

At the same time there is many an instance where land has been acquired promising jobs and settlements and nothing happens thereafter, making the person who surrendered the land in good faith for development rue his decision. These situations cause the heart burn and are the fuel for many a fresh agitation.

What are the issues? Primarily a farmer feels cheated when he sees the land price shooting up just after he has handed over the land either by force or pleasure. This happens simply with the announcement of a new project the real estate value around that area goes up and the person who is facilitating the development looses out. Secondly lot of promises are doled out either by the politicians or the private entrepreneurs that the land owner will be provided with a job or some equity etc.

Due to the reasons best known to them the promises are not kept up once the land is acquired, in some cases the projects don’t come up at all. This is a much more dangerous situation where in good fertile land is made to go waste and which is a loss for the GDP too.

Some ways to overcome this problem.

1. A fair acquisition price which shall take the market price other than the guideline values, future growth potential once the proposed project materialises (a formula which our esteemed economists can come up with) and the loss of revenue for a specified period where in the landowner will neither have cash for further acquisition of land elsewhere nor land to cultivate.
2. Whose ever land is acquired should be given TDR’s (Transferable Development Rights) on a proportionate basis in addition to the fair compensation, which could be used by the farmer/land owner in an urban area falling within 250kms radius, irrespective of state boundaries. In case there are two or more urban areas falling within this distance the choice could be with the seller where he would like to sell it, since the TDR’s are market driven, that is one opportunity; the land owner could enjoy and will not have a reason to complain or object to the surrender of the land.
3. Land seeking companies be it private, public entities or organisations like NHAI or any other State Infra Development companies should have strict land utilisation norms. First land should be allotted or provided only when they submit a detailed project design and clarity on why they require the extent of land that they are seeking. (Ex: A shoe manufacturing company in Tamilnadu acquired 250 acres for Phase 1 and another 200 acres for Phase2) Makes people wonder whether they are hoarding the land or really need it. This is one of the biggest issues in the present day.
4. Once the land is allotted the land seeking entities should have a strict project implementation clause. If the project is not implemented there shall be huge penalties imposed on the company and part of the penalty proceeds should be shared with those who have surrendered the land. This will act as a deterrent on land seeking entities in trying and getting land allotted without tying up their finances or citing reasons like recession etc for not starting the business as promised.
5. In case there is no action from the entity to set up their proposed units the land should be seized back without any compensation and sold to the next buyer. This would set a good example for all the greenhorn SEZ establishers, who have only dreams and no cash to make the project a reality.

The above solutions should address both the so called land-grabbers greed and also the landowner who is made to surrender the land under forced circumstances.

Recently some of the state infra development bodies have come up with land extent that they should allot for specific industry segment, this should be done after a thorough study of both national and international models.

Bring transparency in the whole process, instead of making the politicos and babu’s richer the government should bring in clarity with their area development plans on a 10-20 year vision documents. These documents should be bound on future governments and also should take into consideration wholesome development of the entire state rather than couple of regions which is what is happening today and causing the disharmony among the people. After having experienced the growth post liberalisation and also communication revolution, our babu’s should be competent to draw vision documents in a wholesome manner. These documents should consider various factors like suitability for specific development, present status and future potential based on socio-economic nature of the populace. First 5-10 years the development should be designed concentrating around the district head quarters, next five years should be concentrating around the other urban bodies, Taluq/Mandal head quarters next five years should focus on other locations.

This kind of exercise will eliminate politician/ babu specific developments and will make every state a growth centre.