NITI Aayog all set to give green signal to land leasing

In a landmark decision that would have far-reaching consequences, the NITI Aayog is likely to decide in favour of legalising agricultural land leasing at the earliest, informed sources said here on Tuesday.

An expert committee set up by the NITI Aayog in September 2015 has recommended that "land leasing" can be legalised provided there is adequate financial and other institutional protection to both tenants and land owners.

The committee headed by Tazamul Haque, former chairman of the Commission for Agricultural Costs and Prices, and comprising representatives from states like Maharashtra, Uttarakhand, Andhra Pradesh, Punjab and Rajasthan, said that the tenants should get financial protection from banks and insurance companies.

"The recommendation came after the panel interacted with representatives from various states, including the likes of West Bengal where there is strong opposition to land leasing," a source told IANS.

The NITI Aayog is now likely to take a final call on the matter "at the earliest or even in days" after the matter is discussed with the Prime Minister's Office (PMO) and other stakeholders in the government.

The land resources department, among others, made a detailed presentation to the panel on the issue even as the committee members "took cognizance of the fact that in many states land leasing was practically banned".

"This blanket ban in several states had left huge land unutilised at a time when various quarters felt such a ban was uncalled for. The move to allow land leasing will help achieve higher productivity in agricultural products as informal tenancy mostly left fields unutilised. This trend needed to be reversed," the source said.

According to sources in the NITI Aayog, the original intent of the restrictive tenancy laws "no longer holds any relevance" as in more cases than one, the restrictions "have detrimental effects on not only the tenant for whose protection the laws were originally enacted but also on the landowner and implementation of public policy".

In a system where informal tenancy prevailed, the landowner also feels a sense of insecurity while leasing land, they said.

"The panel has made a detailed study and made a comprehensive report," the source said, adding many states simply abolished tenancy altogether.

One big benefit from implementing the panel recommendation will be that institutional credit, disaster relief, and other support services denied to tenants until now would be a thing of the past.

"There will be a basic legal framework for tenants too," the source said.

Meanwhile, even as a joint committee of parliament is examining new land bill, the NITI Aayog is keen to work on a model legislation for freeing up farm land. The committee recommendation would help the NITI Aayog, that replaced the Planning Commission, take its proposal forward.

The model act of NITI Aayog will allow farm land leasing as a principle while state governments will be given the power to improvise the same according to its local socio-political requirements.

At present, only land owners can avail of crop insurance schemes or loans but with the panel's recommendation, it is expected that lessee cultivators also could raise crop loans and seek insurance protections.

NITI Aayog vice chairman Arvind Panagariya recently said that "state governments must seriously consider revisiting their leasing and land use laws to determine if they could bring about simple and powerful changes to enhance productivity and welfare all around".

(Nirendra Dev can be contacted at nirendra.n@ians.in)