The erstwhile UPA regime had piloted much trumpeted amendment to Land Acquisition Act – Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act (RFCTLARRA) which came in to vogue from January 1, 2014. Bandied as a revolutionary reform, the Act promised handsome reward to landowners/farmers and speed up the process of acquiring land for building infrastructure and spurring development. However, on a close scrutiny of its provisions, one notices that the outcome would have been just the opposite.
A key provision stipulates that the landowner will be compensated @ of 4 times prevailing market price in rural areas and 2 times prevailing market price in urban areas. This sounds attractive and seeks to put an end to the hitherto extortionate practice of government expropriating land by paying throw away price and leaving farmers in the lurch. However, the benefit will accrue only if land acquisition ‘actually’ happens. A close scrutiny of the rules is in order.
A core requirement for acquisition is that that prior consent of 70% of affected families is ‘mandatorily’ taken in cases where land is acquired for PPP (public private partnership) projects. In case of private projects, the consent requirement is 80%. Another requirement makes ‘Social Impact Assessment (SIA)’ study mandatory. Elaborate procedures for complying with both these will ensure that acquisition proceedings may never get consummated.
Seeking prior concurrence of 70%/80% – a pretty high bar – is by itself mountain of a challenge. Further, definition of the affected person in the Act is ‘ambiguous’ which would make it susceptible to multiple interpretations and therefore prone to litigation. Besides, the clause for SIA through multi-layered committee system – both at central and state level – can be used by vested interests in the political establishment and bureaucracy to indulge in corruption and even frustrate acquisition if their aspirations are not met.
Even when a project proponent is able to steer through the maze of cumbersome and time consuming processes imposed through these requirements, there is yet another attenuating factor waiting in the wings. This one relates to a provision which says ‘if acquisition is not completed within 5 years from the start of proceedings or compensation is not paid to landowners/farmers within this period, the land will have to be returned to them’.
An additional complicating factor pertains to whether in case of dispute, the time lost due to stay or injunction granted by the court would be included within the prescribed 5 years or otherwise. This would have created more uncertainty and become detrimental to smooth conduct of acquisition. Supreme Court has settled this though by ruling that the stay/injunction period is part of 5 year time limit. Yet, the condition hangs like a Damocles sword!
Clearly, the extant provisions of the Act would neither serve the objective of handsomely rewarding landowners/farmers nor ensure timely availability of land for building infrastructure and development needs. The proof of pudding is in the eating. Ever since the new Act was enforced an year ago in January, 2014, the process of acquiring land has almost come to a grinding halt.
The then government’s lack of commitment to the key objectives is also evident from its decision to exclude land acquisition under 13 central legislations in areas such as development of coal bearing areas, highways, railways, atomic energy, mines etc from the purview of the Act. In other words, landowners whose land is acquired under those laws will not be entitled to fair compensation and benefits of rehabilitation and resettlement.
No doubt, land acquired for mentioned purposes serves overriding strategic/security interests of the country and the same is not put to any commercial exploitation. But, that cannot be a valid justification for denying to landowners a fair compensation for land and entitlement to sustainable livelihood. Even so, to give compensation to farmers who surrender land for an industrial project or private enterprise on one hand and deny to those whose land is acquired for strategic uses on the other is outright discriminatory.
Non-availability of land is the single most important impediment in the way of reviving investment and growth which was languishing during the last 3 years of UPA-II. The second most critical factor was delay in grant of environment and forest approvals. To put these approvals on fast track, while, Modi – government has already taken several steps including introduction of e-approval system, for removing impediments to acquisition of land, it has been mulling over amendments to RFCTLARRA.
However, keeping in mind the fate of Coal Mines (Special Provisions) and Insurance Act (Amendment) bills in just concluded winter session of parliament where the errant opposition members simply did not allow the house to transact any legislative business, it decided to make amendments in the Land Acquisition Act through the ordinance route in much the same way as done for former 2 bills.
As per the amendments, five new categories of projects including projects related to defense, rural infrastructure, affordable housing for the poor, industrial corridors and infrastructure projects including PPP projects wherein the ownership continues to vest with the government, would not require prior consent from affected families. These will also be exempt from SIA. However, provisions relating to compensation, relief and rehabilitation stay in tact.
In cases other than mentioned 5 categories, no changes have been made to consent and SIA requirements. However, necessary amendments have been made to address procedural difficulties in acquisition of land required for important national projects and ensure that the process gets completed within a definite time frame.
The amendments also include 13 legislations that are currently exempted under the purview of the Act in the compensation, rehabilitation and resettlement provisions. This will ensure that all landowners who surrender land irrespective of the end use will be entitled to the benefits contemplated under the Act on the same basis without discrimination.
The government has also relaxed the retrospective clause providing for return of land to owners if acquisition is not completed within 5 years from the start of proceedings or compensation is not paid to landowners/farmers within this period. This has been increased to 10 years so as to provide full comfort to acquisition process.
In short, true to its DNA and in line with its overarching commitment to remove all obstacles to development, the present government has removed all flaws in the amendments to Land Acquisition Act earlier passed by UPA dispensation. It has done a brilliant job striking a judicious balance between urgent need for kick starting the investment cycle to put the economy on high growth trajectory on one hand and ensuring a fair deal to poor farmers/landowners on the other.