The Land Acquisition Bill

I am a socialist at heart. I believe in public good over corporate profits. I think that mandatory CSR spend should be at least 20 per cent of a company’s earnings before tax. Yes, draconian. But in a socialist way. Or so I hope as everyone can’t be kept happy. Someone somewhere has to disagree. That is the law and even though we are masters at breaking them, this is one law we adhere to its soul.

Anyway, coming back to the issue — The Land Acquisition Bill. Now, I don’t want to get into the entirety of the bill but just one moot point — The panel suggests that the government should not help companies in buying land.

You might say that this will help people in getting a fair value of their land as the government always pays less. Also, why should the government became the bad guy in the corporate-citizen stand-off. Fair enough. However, if this is the bill and your support, then first stop comparing yourself to China. Because there, what the government says is the last word. In India, multi-billion dollar projects are delayed by half a decade at the minimum because of land acquisition issues. Google: JSW Steel, Tata Steel, ArcelorMittal, POSCO, etc.

Now, I said I am a socialist but the last argument was anything but that, correct? Right. This is because I have a problem with this perspective of the parliamentary panel’s recommendation. Either you are pro-development or against it. There is no middle path here. Yes, the development can be slow or expedited depending upon the wish of the government and the law of the land, but it is still development.

India, currently, is nowhere.

In my view, the government cannot pull its hands from the land acquisition and get the corporate world in direct contact with the farmers/poor citizens, et al. You just can’t. The FDI in retail was to eliminate the middle-men and get farmers their due.

The government has to play the middle-man in land acquisition to get the farmer their due. Don’t believe me? See what happened at Tata Steel’s plant in Kalinganagar. How many people protest the plant and how many adivasis died. What happens in Chhattisgarh in the name of land acquisition.

Look at ArcelorMittal. Trying to buy land in Jharkhand for 7 years now and they are still at zero. From changing the location of the plant to downsizing the capacity, they have tried everything. Zilch, yet.

Yes, the government intervention is a red-tape step and you might even term it as regressive and further slowing down of the economy. But this is a decision you have to make.

Some sacrifices will have to be made. I am ready to sacrifice the pace of development for the so called ‘ inclusive growth’. Which, in my mind, cannot happen if the government is absent from the land acquisition for manufacturing sector.

Companies will bully the poor farmers, pay them lumpsum and throw them out of the land. The policy should mean that the government is a custodian of the rights of the land owners even after they have agreed to sell.

This is one responsibility the government cannot shy away from. Unfortunately, that is exactly what  the parliament is trying at the moment.

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2 thoughts on “The Land Acquisition Bill

  1. Satish Suggala (@MindYoghurt) May 18, 2012 at 3:13 pm Reply

    I believe the best way forward for corporates is to work with the landowners and give them stock instead of cash. I’d cite Renuka Sugars as an example. They’ve never had any major protest to their factories. But yes, the government does need to step in and act as a mediator between citizens and corporates.

    • shubhashish May 18, 2012 at 3:55 pm Reply

      Just compare the stock price when it was offered to the people and what it is now. You will get the answer why people are unhappy.

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