At last count, over Rs. 7 lakh crore worth of industrial projects lay stalled across the country. A good percentage of this is because of problems over the acquisition of land. A return to a high growth trajectory for the economy presupposes the removal of the bottlenecks that hobble industry.
Easier and more equitable land acquisition laws would definitely go a long way towards easing the roadblocks that now constrain the Indian economy. So, it is good news that the two largest political parties in the country have arrived at a consensus on the fine print of the new bill to replace the draconian Land Acquisition Act, 1894.
The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill, 2012, as the new law is called, can, indeed, offer a new deal to Indian farmers as well as to industry. This new deal begins with the title itself. A simple reading makes it adequately clear that the bill will attempt to ensure fair and equitable compensation and transparency in the historically opaque land acquisition process. Currently, forced acquisitions, the absence of safeguards against misuse, inadequate resettlement & rehabilitation provisions for displaced farmers, and absurdly low rates of compensation often lead to long-drawn-out litigation, making land acquisition an inordinately lengthy process. Result: development work and industrial expansion get delayed.
Moreover, instead of opposing acquisition almost as a matter of routine, farmers and other land owners will be able to take economically rational decisions on whether they want to part with their land or retain it. Compensating farmers and other land owners at market rates will, over time, encourage many more people to migrate from their almost fatal dependence on land to other potentially more rewarding economic activity — like salaried jobs, trading and even industry. This can only be good news for the Indian economy.
We hasten to add here that the new bill is not — and cannot be — a panacea for all the ills that currently dog land relations in the country. But it is a major step in the right direction. Our humble appeal to our politicians and to Parliament: we have dithered over this bill for far too long. Please pass it as soon as possible.