Land Acquisition Bill: The ruler of lands

For decades, land reform has been tossed aside as one of the unimportant issues of all times. Eventually, sidelining the issue has resulted in an economic cost that is slowly crippling the nation. With India’s industrial output taking a dip in the last fiscal year, the need to spur a domestic growth was much felt. The newly framed land acquisition bill is a move taken in this regard.

The bill focuses on the government’s determination to bring into foray more transparency and lucidity in the land acquisition process, more importantly for the private sector. Albeit, the bill is introduced to create a positive impact, it is still a big question how far the new policy will extend and generate the anticipated impact.

Focusing Point

The Land Acquisition Bill created a wave of anticipations and is expected to focus on modern realities more precisely, since it replaced the British law, however often expectations do not turn true. In tune with the modern realities and issues, the bill reflects on large land parcels (such as 100 plus acres in rural regions). Such land parcels are generally available on the peripheral locations of towns and cities, where the private parties inherit the land, instead of the farmers. In such cases, the bill will be of least value during land acquisition for industrial or urban real estate purpose.

So who will be at a loss? Companies falling under the manufacturing and infrastructure sectors, who require huge land parcels on peripheral locations of a city for their operations, are expected to feel the heat. Two primary reasons can be attributed to such a problem- the compulsory permission provision and the cost burden that is expected to render a direct blow to the projects and cripple its financial viability.

Compulsory consent and likely upshot

As per the compulsory consent clause, the land acquirer must engage in Social Impact Assessment test of the particular plot of land fixed for acquisition. The outcome of the SIA test must be sanctioned by the approving committee. With the identification of displaced and affected households, the agency acquiring the land must get ‘mandatory consent’ from 70% of the families for a Public Private Partnership project and 80% of the families for a private project.

The bill, however, is tagged with few upshots that is likely to make infrastructure and manufacturing firms pull their coat while purchasing bigger plots of land, except for the few that are under government ownership. For individuals who invest forth, will be left with no alternative other than relegating the increased cost to all the end-users. Furthermore, even the public private partnership projects which are run by the government,, generally in the energy or road sector, can fall into a crisis due to large acres acquired.