Road transport minister Nitin Gadkari has refuted the opposition's charges of the amendments to the Land Acquisition Act as being anti farmer. Speaking to CNBC-TV18, RV Kanoria of Kanoria Chemicals and Chandra Bhushan of Centre for Science and Environment discussed the pros and cons of the bill.
Kanoria believes Land Acquisition Bill cannot be dealt in bits and pieces as it is a big sentimental issue and will affect lives of majority of Indians as agriculture still remains the primary occupation of the people of this country.
Concurring the view, Bhushan also believes farmers must be consulted before making the bill and the government should not hurry in pushing through the land ordinance.
Below is verbatim transcript of RV Kanoria and Chandra Bhushan's interview with CNBC-TV's Menaka Doshi and Senthil Chengalvarayan.
Menaka: Industry has been fairly vocal over the last several years that buying land in this country to set up a manufacturing facility is very difficult. Therefore, are you in favour of several measures that this ordinance short circuits, for instance the consent mechanism or the social impact assessment mechanism in order to make the acquisition of land easier?
Kanoria: The Land Acquisition Act itself was not thought through. It was more of an emotional and political decision and the amendment to the act in the form of an ordinance has also not been fully thought through.
The fact that land is difficult to acquire in the country is a given. At the same time we are dealing with a very emotive issue where we are talking about displacement of farmers, displacement of livelihood and so, it needs to be handled in a very different way.
We have put ourselves in a bind by introducing the act in the first place and then trying to amend it because the act, as it stands, is incapable of actually being implemented in the true spirit that it is meant to be.
It is important to understand that this government has tried to change the procedure through the ordinance. It has not changed the compensation.
What the government is saying is let us not make this a lengthy procedure, let us not have a social impact assessment study, let us not go through a method of consent which is actually a very impractical method because it requires meetings of several gram panchayats and the process itself is so cumbersome that a poor farmer who wants to actually sell his land will virtually not be able to sell it and the ones who want to acquire it will not be able to acquire.
The needs of the farmer, the needs of the development process and the needs of the buyer are all being compromised through the acquisition act as well as through the amendment in the ordinance.
What we really need to understand is that are we willing to sacrifice our development, do we want to condemn our farmers to remain just farmers and not give them better opportunities.
Let us not forget that 65 percent of our population is still dependent on agricultural income whereas only 19 percent of our gross domestic product (GDP) is agriculture.
If you look at it in developed countries, like in US, only one percent of the population is dependent on agriculture. So, we should give our farmers this opportunity and must find a fair and clear method by which acquisition of land can actually happen.
One of the suggestions that we have been making from industry is where there is a willing buyer and a willing seller why do we want to complicate it with rehabilitation and resettlement and all these kind of things because the price discovery happens by the virtue of the transaction itself where you approach someone to sell the land and you negotiate a price and buy the land.
So it is a willing buyer-willing seller situation and even in that case the Land Acquisition Act actually imposes the R&R settlement. So, this is one aspect of it.
The second aspect is that why can't the government designate certified areas, let us say, this 10,000 hectares if it is purchased by the industry there will be automatic change of land use.
Now by not giving that land use change they are actually denying the farmers their right compensation because industry when it buys the land has to factor in the risk of whether the land use will be changed or not, as to what will be the FIR, what will be the regulations associated with the use of land.
There are some fundamental issues we are discussing today and we have put ourselves in a bind. The way I look at it is that two or three years down the road there will be no land acquisition and the farmers themselves will come and say that we need to revisit this act to ensure that at least those who want to move away from farming are allowed to do so.
Menaka: What is eminent domain- where the government acquires land for large national projects like dams and what should be the resettlement and rehabilitation provisions as opposed to what should apply to the private purchase of land which is an industry or a business going to a group of farmers and negotiating with them whereb? If the farmers are agreeable then there should be no rehabilitation and resettlement measures. I think that distinction needs to be made in this conversation. In eminent domain, the worry here is that the concept of eminent domain has been expanded to include a variety of things for instance affordable housing. Now, building a dam in the interest of the nation and building affordable housing where there is private profit maybe even in play or at play, those are two different things. I think that is where some of this opposition to this bill comes up and that is what I am trying to distinguish in this conversation as well. What do you make of what or how this ordinance is attempting to change our land laws?
Bhushan: I will agree with certain point that Mr. Kanoria said. He rightly said that we enacted this law by not looking at many other things and this ordinance we are trying to push through also in a hurry. We need to sit down, think through and come out with a middle path which will ensure that some of the major problems that were there in the past is not repeated again.
Menaka: Could you be specific about which elements of the ordinance you do not agree with?
Bhushan: The ordinance tries to remove two things; one is the consent mechanism and second is social impact assessment. We also believe that the social impact assessment was not a problem. In fact if you look at Chapter 2 of social impact assessment, the first part is investigation to determine social impact assessment and public purpose. This is a very important component. When you are going to acquire land, the point you are making about eminent domain, public purpose and it is very important to investigate what will be the impact. The Chapter 2 B where there is procedure, you have to do social impact assessment.
Menaka: That is a painful one.
Bhushan: That is also premature.
Menaka: Because we do not have the institutions to do it now.
Bhushan: Yes, we do not have institutions to do it therefore it was a premature thing to say that we will have social impact assessment and it all happened and we see what is happening in environmental impact assessment.
Menaka: But what about the consent clause, I understand maybe the consent thresholds are very high, 80 percent, 70 percent but after all we are shareholders to vote on what their companies and their managements are doing. Why should land owners not have a say when their land is being taken away from them?
Bhushan: That is where I disagree with Mr Kanoria. Two things Mr. Kanoria said that it is between buyer and seller and price discovery. A large part of India is not Delhi, Haryana, Ghaziabad and Faridabad, a large part of India has no mechanism of price discovery whether you go to Chhattisgarh, you go to Jharkhand, part of Orissa, part of even Gujarat; there is nothing called as price discovery there.
Price discovery is applicable where you have demand for land; industries go for mining which is there is no demand for land. In fact a large part of India has no title for land, people are customary right; how do you deal with those issues? So, one is that this price discovery part where buyers and sellers can deal with each other is applicable only in certain part of India, not in large part of India and you need a mechanism for land acquisition rehabilitation and resettlement there. It is not a mater with a farmer in Haryana but it is imminently important for a farmer or a tribal in Chhattisgarh, that distinction needs to be understood.
Second point is about consent clause. Some sort of-if not 70 percent or 80 percent that we are talking about, if we can do better investigation of social impact, what impact it is going to have, what will be the public purpose, how the community is going to be effected, if people are involved in this decision making process, if we can from consent if we could come out with a mechanism for consent cum consultation or consultation cum consent, we will have to have some sort of consent.
Menaka: Would you say that an 80 percent or a 70 percent consent threshold may be too demanding but doing away with consent altogether especially in projects that are not necessarily pure eminent domain, affordable housing must require the consent of the land owner especially when there is private profit at play?
Kanoria: I agree that price discovery is also not a process which is relevant to many parts of the country and I think we have to find a solution to it. There has to be proper rehabilitation, there has to be proper settlement wherever there is no price discovery.
One size fits all Land Acquisition Act also may not be the right answer to it.
The second point I would like to make is, when you talk about consent, if the social impact assessment study can be done in advance and designated areas be earmarked for different types of development whether it is affordable housing, whether it is industry, whether it is mining and if that process can be done in advance then the possibility of price discovery also increases because the seller knows what he can expect in terms of the return and the buyer also knows what the land use can be. So, the consent mechanism itself whether it should be a pre-consent or after-consent, the social impact assessment study is also something which should be looked at.
Prima facie I think this law needs a complete revisit. It is not something which can be done in bits and pieces. It is an emotional, sentimental issue, it is fundamental to the livelihood of a large part of the population of this country and we cannot treat it without understanding the implications on every side. At the end of the day we also want development but we don't want it at the cost of people.
Industry also wants to ensure that people get their due returns but at the same time development in the country shouldn't stop, the opportunity for new jobs, the opportunity to change ones life, these are all fundamental questions we need to ask ourselves.
Land Acquisition Act is a difficult act to handle. It is really a tough problem which the government has got to solve today.
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