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Karnataka differs with Centre on land bill

Mahesh Kulkarni  |  Chennai/ Bangalore 

State government wants to take consent of only 70 per cent farmers; ready to pay only double market value for land.

Karnataka government, which is in the midst of the controversy lately over the for several big-ticket investors signed up during the global investors’ meet last year, is in no mood to accept certain changes proposed in the new Land Acquisition and Resettlement & Rehabilitation Bill tabled in the Parliament last week.

Instead, the government is in the process of revamping its existing land acquisition policy governed by the Karnataka Industrial Areas Development Board (KIADB). The state government is not agreeable to the 80 per cent consent norm proposed in the new Bill. It wants to settle for 70 per cent consent of farmers to acquire any land.

“We will wait for the Centre to pass the new Act in the Parliament. Once it comes through, we will incorporate the best clauses from it and revamp our state Acts,” said Dr V S Acharya, senior most member of the state cabinet and minister for higher education said.

However, the state government has not given its comments to the Centre on the draft Bill circulated to the states about few months ago due to shortage of time, a Revenue department official said.

“Giving four times the market value to the land losers is difficult. We can think of giving four times the value of sub-registrar’s guidance value, which is normally far below the market rate. In fact, Karnataka government is already giving the double the guidance value for many projects in the recent days,” Murugesh R Nirani, minister for large and medium industries said.

The Karnataka government has recently added several new components as part of its compensation and rehabilitation package to farmers. Following the global investors’ meet, the government, in order to encourage farmers with single crops in a year, has offered 9,600 sq ft of developed plot per acre to those who does not want to take cash compensation. It has also offered reservation in the admission to ITI colleges for the children of land losers and one job per family in the industrial projects coming up in the state, Nirani said.

The global investors’ meet (GIM) held in June 2010 attracted 383 companies from around the world and witnessed signing of MoUs for an investment of Rs 4 lakh crore.

In Karnataka, the land is acquired under three separate agencies for various purposes. For industrial use, the land is acquired by Karnataka Industrial Areas Development Board (KIADB), which is governed under the Karnataka Industrial Areas Development Act of 1966. The Bangalore Development Authority acquires land for residential purposes in Bangalore and other urban development authorities at the district level. For other public purposes like infrastructure projects such as railways, roads and public buildings, the Revenue department acquires land under the Land Acquisition Act of 1894.

Over a year ago Karnataka government ventured into the task of creating a land bank with about 100,000 acres for industrial use. This was done with the global investors’ meet in mind. The government did not want to lose any opportunity of getting big-ticket investors into the state, after it lost Tata Motors’ Nano project to Gujarat in 2008 due to lack of adequate land in its possession.

Presently, the has issued preliminary notification for 88,000 acres for industrial development across the state. Of this, final notification has been issued for 36,000 acres.

Though the government signed memorandum of understanding with large investors like ArcelorMittal, Posco, Bhushan Steel, NMDC, Tata Metaliks, Lafarge among others during the GIM 2010, it has been successful in acquiring land only for ArcelorMittal till now. Recently, the government had to face a severe opposition from farmers in Gadag district for for Posco steel plant. After about 15 days of resistance from the farmers, the government dropped it from acquisition.

“The land acquisition affair has been very smooth in Karnataka over the years due to farmer friendly policies. We do not force any group of farmers or landowners if they refuse to part with their land. If the people who are opposing any land acquisition are in minority they have to seek the intervention of the court and get higher compensation,” a senior official of said.

Though there were no specific instances of Singur-like instances in Karnataka in the recent years, some farmers had opposed the for some projects. Last year, farmers had opposed acquisition of land in Bellary for development of a minor airport and setting up of steel plant by ArcelorMittal. There was also opposition for acquiring land for steel plant of Tata Metaliks in Haveri district and in Bijapur district for the setting up thermal power plant by NTPC. The opposition was mainly on account of lower land compensation. However, these issues have been solved after the government raised the cash compensation.

The sections of industry have expressed mixed reactions over the proposed Bill.

“With increasing pace of development, availability of land is going to be a major challenge. In the context of inclusive growth, a well-defined R&R policy is also a necessary requirement for helping the people who are displaced. We welcome the initiative to introduce a comprehensive “National Land Acquisition and Rehabilitation and Resettlement Bill 2011,” J R Bangera, president, Federation of Karnataka Chambers of Commerce and Industry (FKCCI) said.

FKCCI has also welcomed the move allowing the private companies to buy equal to or more than 100 hectares. “This indicates that private companies, particularly in the MSME sector, who buy less than 100 hectares are not burdened with the R&R provisions,” Bangera added.

Vinod Nowal, president, Bangalore Chamber of Industry and Commerce said that the land given for industry / commercial complex should be developed in a planned manner keeping the environment, ecology and society in a healthy state. “The land which is not usable for agriculture purpose should be acquired and provided to industry for industry / commercial purposes and ensure that some long term benefit should be given to the farmer besides one time payment — some scheme has to be drawn so that some periodical accruals can be given to the land givers for 10-20 years,” he said.

H V Harish, partner, Grant Thornton, an audit firm, said the provisions of the bill be widely debated and not rushed through keeping short-term political gains in mind. “A proper mechanism to acquire land and compensate farmers in a fair manner is required. Clearly there is competition for land, which is increasingly becoming more valuable and in the process of wanting to be fair we should not forget the long term benefits of creating wealth on a sustained basis,” he said.

Anand Desai, a farmer leader from Gadag who had opposed acquisition of land for Posco steel plant said that the government should not acquire fertile agricultural land for industrial purpose. “Farmer holds the first right to his land. He should not be displaced from his land which is passed on to him for generations, in the name of industrial development.”

Harish has also sought clarity on seeking the consent of 80 per cent. “The Bill says 80 per cent consent is required. It is not clear whether this is 80 per cent of the owners or 80 per cent of the land that is being acquired. If it is the former then it will create needless hurdles,” he said.

‘While the National Land Acquisition, Resettlement and Rehabilitation Bill 2011 tries to fill in the gaps in the process of land acquisition, there is a greater need for making the default clauses stringent. Given the lopsided nature of relationship between the parties interested in acquiring the land, those who want to sell the land (farming community) there needs to be a greater provision for protection benefit for the interest of the farming community, Ajay Kakra, Associate Director, Agri & Natural Resources — Government Reforms and Infrastructure Development, PwC India said.

He said the reaction of the state governments is favourable to the bill. Some state governments like Kerala and Noida have already passed the draft bill. However, there is strong resistance from farmer organisations. Even in Karnataka farmer organisations such as the Karnataka Rajya Raitha Sangha (KRRS) are strongly against the implementation of Land Acquisition Bill, particularly on the rehabilitation issue,” he said.

Having a high announced rate at four times in the rural areas and two times in the urban areas, seeking the industry to do an R and R seems like adding substantially to the cost of building industry. The definition of projects that do not need public consent should include transportation projects (airports, roads, metros) and other key infrastructure projects also, Harish added.

Till date, the has formed 132 industrial areas all over the state and acquired land for nearly 400 Single Unit Complexes, ensuring balanced industrial development in all regions with well thought of infrastructures and unique features. This apart, KIADB has envisaged several innovative projects like agro-tech parks, apparel parks, food parks, auto parks, hardware park, bio-tech park, EPIPs, sector specific SEZs, growth centres among others.

First Published: Sun, September 11 2011. 21:07 IST