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Land is fast becoming a high-risk asset in many parts of India. Once a relatively abundant resource, especially in areas away from major urban centres, land is increasingly becoming difficult to acquire and prone to uncertainties.

Landholders, especially politically orga-nised farmers, are resisting large-scale government land acquisitions and even questioning past buyouts.

Much of this is the result of forcible land acquisition by state governments at rates determined by administrative fiat and not market. An antiquated colonial law on land acquisition has allowed local governments to compulsorily acquire land merely by declaring it to be in public interest and without issuing notice to the land owner. The original idea behind this 1894 law was to get land for essential works such as roads, public buildings, railways and similar infrastructure projects.

In recent times, however, much of the acquired farm acreage has gone towards private housing schemes. Much of these lands acquired by local govern-ments have been and continue to be transferred to private real-estate players, industrialists and powerful individuals at relatively modest prices. This has helped private players, and in some instances government institutions, reap huge profits, leaving villagers dispossessed and marginalised.

Resentment against this clearly unfair process has been growing in different parts of the country and in recent times has become a potent political issue. The best-publicised examples of this include the Singur land agitation in West Bengal, the Bhatta-Parsaul episode in Uttar Pradesh, the anti-Posco agitation in Orissa and the Jaitapur protests in Maharashtra.

The cannier politicians in the country are beginning to realise that land acquisition has become an issue fraught with great political, and at times, security risks. Judging from available trends, the political class is responding by increasingly washing its hands of this process, even though land has often been the single largest source of political funds.

Earlier, anti-acquisition agitations were localised affairs, a significant percentage confined to remote tribal areas, that attracted little media or political attention. The politicisation of this process was inevitable and once politicians like Bengal’s Chief Minister, Ms Mamata Banerjee, and more recently the Congress’ Rahul Gandhi, jumped into the fray to make capital of such agitations, the equations changed abruptly and dramatically. Today, every political party is fast getting into the land agitation bandwagon. In Odisha, five different political parties — the Communist Party of India, Communist Party of India-Marxist, Forward Bloc, Samajwadi Party and Rashtriya Janata Dal — have joined peasants in their agitation against the South Korean giant Posco’s $12 billion steel project.

Government land acqui-sition in many parts of the country has consequently become the principal political issue of the day. Even the Prime Minister, Dr Manmohan Singh, whose government has been sitting on the proposed changes to existing land acquisition law for the past four years, has commented on the urgent need to amend them. In contrast, the Uttar Pradesh Chief Minister, Ms Mayawati, has moved swiftly to contain the political fallout of the Bhatta-Parsaul uprising, where two policemen were shot dead by protesters and an unknown number of villagers killed in police retaliation, by issuing an amendment to the land acquisition process.

Ms Mayawati has declared that the government will not involve itself in acquiring land for private developers. Further clauses in her land acquisition policy stipulate that bulk land transfers will not be valid unless 70 per cent of the farmers consent to the project and that, apart from cash compensation, 16 per cent of the developed land will be given to those dispossessed by the acquisitions.

Ms Banerjee has not as yet legislated on the subject but has told a group of industrialists that the state government would not involve itself in land acquisition for private industry. This declaration has left industry cold. For, as the chief of the ITC group pointed out, the do-it-yourself suggestion has little practical merit given that even his company has not been able to get land for its project in the state even after trying for five long years.

Telling the private sector to go its own way in land acquisition is not going to work. Industrialists, real-estate developers and even agricultural-estate developers require governmental assurances and guarantees without which the whole process becomes highly uncertain. Two further risks have become apparent in recent times: legal issues and renewed agitations for retrospective additional payments even after sale has been long concluded. In Noida, for instance, farmers have been agitating for more money from private developers on the ground that the value of the land they had sold previously has risen sharply in recent times!

Public sector and infrastructure projects too are bound to be hit. Recently, the government scrapped plans to set up an expressways authority to speed up road construction because it would involve land acquisitions. Several railways projects, including a prestigious freight-corridor proposal, have been held up by protests in parts of Maharashtra. Such protests have only been growing all across the country.

The problem is unlikely to disappear soon for several reasons. It is very likely that more and more state governments will follow the non-interventionist Mayawati-Banerjee model. The pendulum that once swung in favour of state intervention in the matter of land acquisitions is rapidly swinging in the opposite direction. The result is another disequilibrium that is bound to add to business uncertainties in this country and stymie growth.



Is land the new high-risk asset? | Deccan Chronicle
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  • India fights Bharat for territory

    A big war is on for territory, and it looks like India is fighting Bharat on many fronts.

    In Bengal, Orissa, Karnataka and Uttar Pradesh, governments are acquiring huge tracts of land for projects that, as the Supreme Court said yesterday, enrich a few at the expense of many.

    Governments hand over cheaply and forcibly acquired land to private companies to develop expressways, housing colonies, mines, and factories. (In pre-liberalisation times, the government would have set up public sector units, but it now only talks of private-public partnerships, coming across to the deprived as a dalal acting on behalf of the moneybags).

    The land-owners, mostly small farmers, aren't giving up so easily. They look at it this way: "The city-slickers have money, bulldozers, and a convenient land acquisition law to back them. But we still have one weapon: our vote."

    Land wars exact a heavy toll. The CPM, for example, didn't take protesting Singur and Nandigram farmers seriously, and as a result, comprehensively lost Bengal, a state it had ruled for three decades. The land wars are spilling over into politics in many other states as well.

    The moment Mamata Banerjee came to power in Bengal, she passed a law to take back land that the CPM government had handed over to Tata Motors. She has a promise to keep: returning land to farmers angered by the CPM's forcible acquisition. The Tatas, after suffering a setback in the High Court, are now approaching the Supreme Court. The battle has cost both parties dear. The protesters have lost lost their lives and property, the Tatas are losing a lot of money, and the CPM has suffered humiliation.

    Uttar Pradesh Chief Minister Mayawati faces assembly elections in a year, and is getting jittery about the land battle in her state. She has been rapped by the courts for taking fertile land away from Noida farmers to help real-estate developers. She has also faced widespread protests and demonstrations. Rahul Gandhi has been quick to seize the political opportunity; the Congress is celebrating his birthday as Farmers' Rights Day from this year.

    Other leaders are uneasy, too. As Reuters reports about Posco, "The ... protests are another storm warning in an environment growing increasingly hostile to what many Indians see as a nexus of corrupt politicians and businessmen profiting from kickbacks and forced land acquisition as foreign firms vie for a place in the Indian market."

    Over the last two days, people in Orissa have been stalling Posco employees from fencing off a huge area for their steel plant. The agitation against the steel plant is already six years old. Even those supporting the project are angry that Posco is giving out work to contractors from outside the region; they will allow work to progress only if their demand for work is met. The state government is unlikely to renew its contract with Posco by the end of this month, when it is due.

    Orissa is saying children shouldn't be roped in for the agitations, but women and children have remained in the forefront of the movement to keep Posco away. Karnataka faces similar problems. Between Bangalore and Mysore, a private road builder has acquired thousands of acres, some of it allegedly by fraud, and is charging the highest toll in India. JD(S) leader H D Deve Gowda is rallying farmer against highway builder Ashok Kheni.

    The government's failure to rehabilitate displaced people hardly makes news, but the rural-urban divide is starkly exposed every time a land agitation makes it to the headlines. One way out has been for the farmers to form co-operatives and negotiate with industrialists who want to buy their land. That way, they get the best deal, and are in control of their own lives. Another is to change the land acquisition law, and forcing governments to be more responsible to their people. The centre has been talking of a new law that is favourable to farmers. The earlier that comes into force, the more conflicts we may be able to avert.



    India fights Bharat for territory | Box Populi - Yahoo! News
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