LAND BILL - MORE SOCIALIST HENCE ANTI CAPITALIST

By Ruma Dubey

Finally, the 120-year old law on acquisition of land might change. The draconian law which has today become a major bone of contention, jeopardizing development and most of the times, livelihood of the farmers, is in the final stages of getting a new face. And if this becomes a law, farmers might actually get the right due for their land and developers who have been making over 100% profit margins in realty projects, will now have to contend with lower margins. For people like you and me, well, the dream house threatens to remain just a dream as every cost rise for developer, will continue to get passed on to we the people. But the good news is that the farmers and those whose only asset is the land which they own, well, they could probably get much better compensation. Naturally, what is good socially is never good for the capitalist so the builders are unhappy and so is India Inc.

A quick look at the highlights:

• Compensations have been upped - up to 4 times the market value in rural areas and 2 times the market value in urban areas.
• Consent of 80% of land owners required for acquiring land for private projects and of 70% landowners for public-private projects.
• Unless and until all the Resettlement and Rehabilitation (R&R) payments have been made and alternate arrangements made, no one can remove the landowners.
• To address historical injustice the Bill applies retrospectively to cases where no land acquisition award has been made.
• Consent required of Gram Sabhas when land is in Scheduled areas
  States to impose limits on the area under agricultural cultivation that can be acquired – this is to prevent arbitrary acquisition and safeguard food security
• States empowered to return the land to either the owner or the state land bank if land remains unutilized after acquisition – this puts into perspective the entire Tata Motors – Singur land debate
• If acquired land is sold to third party, if profit being made is 40% of the originally paid price, this profit has to be shares with the original owner. This would be exempt from tax and stamp duty  – this is something which will get twisted because even if profit is above 40%, no one will show that on paper.
• Bill defines "public purpose" to include - mining, infrastructure, defence, manufacturing zones, roads, railways, highways, and ports built by government and public sector enterprises, land for project-affected people, planned development and improvement of village or urban sites and residential purposes for the poor and landless and government-administered schemes or institutions, among others.
• Provisions of this Bill shall not apply to acquisitions under 16 existing legislations including the Special Economic Zones Act, 2005, the Atomic Energy Act, 1962, the Railways Act, 1989, etc.
  
   

It is a human centric policy so naturally cannot be capitalist and hence anti-industry. In no developed economy is there acquisition of land. Inc is miffed that the Govt is showing such disdain for the word, “profit”. Well, profit is not a dirty word, the only thing which the Govt is saying is that those who want land for profit, should do so on their own effort; why should thousands of people be thrown out of their homes for someone to make money?

Naturally, the builders lobby is angry, and they have all collectively termed it as detrimental to growth. They feel that the Govt is going to the other extreme to take care of the farmers at their cost. Well, when all the realtors feel the same, surely it means that the Govt is doing something right! Did you ever hear any of these developers complain when they acquired land at a pittance and sold it at over 100% gains to the buyers in Noida? What they are probably complaining about is the lower profit margin they might now earn. And that is good as long as money goes to the farmers.

Being pro-poor is never good for the market but it is good for the nation. And that is more important than the market. But at the same time, the Food Bill is a noble thought but something which the country cannot afford and there are better ways to do good than make beggars of people without providing them employment opportunities. But the Land Bill is truly trying to protect the right of the land owners. Builders are like sharks – they will always get their meat. And yes, we the middle class will continue to get stressed from both sides, no law protects us. Either we shift to the lower rung or to the higher rung, that’s probably the only way out! For us, buying a home will continue to remain an elusive dream as prices will only go up further as builders land acquisition costs will soar through the roof.