Land acquisition law responsible for higher highway costs
The highways ministry is getting nervous because the latest land acquisition law could be responsible for increasing the cost of highway construction projects. On one hand, the UPA government claims that the new land acquisition law is its one of the achievement during their current tenure. While on other, projects like the Delhi-Jaipur Expressway being pushed by the Prime Minister’s Office faces a sweep in real estate because of the legislation based on the assessment of the National Highways Authority of India (NHAI). It told the ministry that the cost of project’s land will increases 3 times from the original cost.
The ministry is evaluating the impact to get increased budgetary support besides revisiting the Bill with other departments to resolve certain problems.
The latest land acquisition Bill is known as The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 came into effect in January. This bill aims to give land owners fair compensation for the land taken away from them for the governmental use.
An official says that as per the act, the land owners will get up to 4 times the cost of in rural areas and 2 times of the cost in urban areas. But this gives birth to the question on financing projects given limited resources.
The provisions of the Act don’t apply to 13 sanctions related to land acquisition including the National Highways Act, 1956, these are supposed to be brought under by the center within a year of implementing new law. This acts states that it could be also applicable with aim modifications that do not minimizes the provision on compensation.
An official mentioned that the land acquired under the NH act, the price which is to pay is determined by the competent authority for land acquisition or CALA based on negotiations with the land owner and focusing on the market value of land at that time. The new law provides compensation for the acquisition and the allied interest.
The Land acquisition and compensation have been discussed with respect to those owning the land should get their fair dues as well as the impact on industry because of higher price. This law faces criticism as well as appreciation. Officials say that the impact of this law is already noticed.
An official says that the ministry has informed that in some cases, the land owners refused to take the compensation from the CALA due to the reason that rates would be higher during the upcoming year. He further says that some state governments raised the questions regarding the topic of which rules should be followed for land acquisition for this year because the new law will not be applicable yet therefore problem arises to proceed at the existing price.
The highways ministry is planning to conduct a meeting in the end of this month to calculate the impact of the new law on this project. The analysis begins after NHAI inform the ministry that the new law could increase the Delhi-Jaipur Expressway’s land costs three times to Rs 18,000 crore and asking the question on the topic of how to finance this project.
Source: The Economic Times
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