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The recent clearing of the land
acquisition bill with the Union Cabinet
proposes to give a much better deal,
including higher compensation to
landowners and sets the stage for
radical overhaul of the 1894 act. The
bill, among other things, makes it
mandatory for private parties buying
50 acres in urban areas to file
intimation with the district collectors
on "the intent to buy the land, the
purpose of purchase and the
particulars of the land to be bought."
Land acquisition is the act of acquiring land from
private party for public purposes by a
government in return for an agreed
compensation. The government acquires land for
urbanization, industrialization and infrastructure
development for its own purpose as well as on behalf of
private parties.
In India, land acquisition is governed by the Land
Acquisition Act, 1894. This legislation enacted by the
British Government was adopted by the Indian
Government post-independence and continues to be
effective to this day. Also, 'land' being a state subject,
each state has its own policy on land acquisition. In the
past, the government continued to acquire land against
the owner's wishes for public purposes under the powers
of eminent domain.
However, in recent times, land owners have protested,
sometimes violently, to such acquisitions. Farmers are
citing loss of livelihood and insufficient compensation as
the major reasons for their protests. In India, land
acquisition and rehabilitation and resettlement are
handled by two separate ministries. Several industrial and
infrastructure projects have been affected due to land
owners' opposition to acquisition.
The recent clearing of the land acquisition bill with the
Union Cabinet proposes to give a much better deal,
including higher compensation to landowners and sets
the stage for radical overhaul of the 1894 act. The bill,
among other things, makes it mandatory for private
parties buying 50 acres in urban areas to file intimation
with the district collectors on "the intent to buy the land,
the purpose of purchase and the particulars of the land
to be bought." The new bill would give enhanced
compensation and relief and rehabilitation (R&R)
package to displaced persons. The 'public purpose' has
been tightly defined to curb whimsical acquisitions.
Private companies would have to give R&R package even
if they directly buy land from landowners, provided the
area is over 50 acres in urban areas and 100 acres in
rural areas.
Land Acquisition Bill, 2011
A new bill called as the 'Land Acquisition, Rehabilitation
and Resettlement Bill, 2011 (LARR) has been proposed
that intends to democratize the land acquisition process,
trying to balance the need for industrialization with issue
of livelihood. The new bill combines land acquisition with
rehabilitation and resettlement.
The following are some of the key provisions of this Bill:
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- The scope of public purpose includes strategic
purposes (armed forces, national security),
industrialization and infrastructure, rehabilitation and
resettlement and private companies using land for
public purposes.
- Land once acquired cannot be put to any other
purpose other than public use ensuring that the land is
not misused.
- The land would be returned to the original owner if not
used within 5 years of acquisition
- In case of government acquiring land to be transferred
to private companies, then at least 80% of the affected
population must approve the acquisition
- Affected families include not only the land owners but
also right holders under Forest Rights Act, 2006 as well
as livelihood losers who depend on the land being
acquired for their livelihood but do not own the land.
- The compensation package proposed accounts for the
following factors for both rural and urban areas
ensuring that the appreciated value of land is shared
with the land owners:
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- Market value of land
- Value of assets attached to the land
- 100% of total compensation |
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As per this, the total compensation in rural areas would
amount to four times the market value of the land at the
time of acquisition and twice the market value at the time
of acquisition in urban areas.
Additionally, the Bill is also set to ensure employment
especially in rural India. Mandatory employment is
included to at least one member of the affected family as
part of the resettlement and rehabilitation which is same
as the previous Act. Secondary impact will be growth in
employment due to development.
> The bill also includes an extensive rehabilitation and
resettlement package which includes mandatory
employment. Also, a fixed timeline is stipulated to
disburse the same.
> In order to ensure better implementation of the
resettlement and rehabilitation, the draft bill proposes
to set up a national monitoring body which will be
regularly updated by states.
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Shrinivas Rao, the founding member of Vestian
Global Workplace Services, is responsible for
Vestian's growth and expansion in Asia Pacific. With
over 20 years of experience in global real estate
industry, he has assisted various Multinational
Corporations with portfolio planning, strategic
consulting, expansions/ relocation and project
delivery in order to achieve their real estate goals in
key Asian markets. His association with the industry
dates back to the beginning of organized real estate
consultancy in the country. He is also amongst the
pioneers of professional real estate consulting
services in India. In his previous engagements, He
has successfully established UGL Equis' Asia Pacific
operations and has held senior positions with
Cushman & Wakefield and Colliers in India. He
received his BE in Civil Engineering and MBA in
Marketing and Finance.
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In comparison to the Land Acquisition Act 1894 that did
not address the prevailing conditions, this bill promises
to live up to the expectations of India Inc. But LARR 2011
will be more suited to today's needs and is expected to
make the process more transparent. This will reduce time
spent in land acquisition however, the acquisition costs
will increase. Land acquisition being the biggest
bottleneck for all industrial and infrastructure projects in
India and faster land acquisition will give impetus
to growth.
The bill will help not only businesses to acquire land but
also the government and contribute to the overall
development of the country. All development projects
like housing, industries, infrastructure etc. will be
positively impacted by this bill.
The bill is still under discussion in the Parliament and is
expected to bring in much required transparency in the
functioning of the real estate sector and thereby ensure the
timely completion of industrial and infrastructure projects.
Once the bill comes into force, it will address the grievances
of both farmers as wells as the corporations/government. A
win-win situation for both parties was the prime reason
behind revising the bill.
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