People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 23

June 05, 2011




Some Issues for Reflection


Archana Prasad


IN its meeting of May 25, 2011, the National Advisory Council (NAC) led by Mrs Sonia Gandhi made some suggestions to re-look and revise the Land Acquisition and the Resettlement and Rehabilitation Bills. It floated a discussion paper and suggested that both these bills should be combined into a single bill entitled the National Development, Land Acquisition, Rehabilitation and Resettlement Act. The discussion paper is a great advancement over the Land Acquisition Amendment Act 2007, but leaves many questions unanswered without whose resolution there can be little effective control on corporate penetration in resource rich areas. At the heart of the debate are also the recent policies of the introduction of private capital in resource based industries like mining. It is therefore not surprising that most of the social unrest has been resulting from displacement and dispossession of land in resource rich tribal areas. Outside these areas, several farmers and fisherfolk have protested against land acquisition and special economic zones like the recent protests in Uttar Pradesh and many small local mobilisations in coastal areas of Gujarat.


In this context there is a widespread desire by democratic and grassroots movements to turn the Land Acquisition Act into an instrument of control over private land grabbing. If the NAC discussion paper is analysed, we may find that there is some headway in this direction, so far as building a political consciousness is concerned. But it is clear that the struggle to achieve this goal will be a hard and arduous one. This is reflected by the way state governments here have reached a near unanimity in all perspectives on land acquisition that the Act of 1894 needs to be amended. But the direction of the amendment is under debate, and the key questions that have emerged are: Who should acquire the land? What purpose should constitute public purpose? What type of compensation should be paid for the land?




The amendment bill introduced in 2007 made certain fundamental changes in the original colonial law. However, many of these changes were not geared towards meeting the needs of the most vulnerable people. One of its major flaws was that the acquisition of land by private companies was largely left out of the scope of the bill. The bill held that if a private party acquired 70 per cent of the land at market prices, then the state could acquire the remaining 30 per cent of it under the “public purpose” provision. The amendment raised the key issue about how acquisition of land for private purposes was to be handled.


In one of the perspectives, it is being argued that state should acquire land for “public purposes” which comprises only developmental and infrastructural work to be done by the government. In this case, corporate buyers should buy land directly from the farmers without any state intervention. The Trinamul Congress is one of the biggest votaries of this view, which will put the farmers at the mercy of the industrialists. This view largely represents those who think that the farmers will get the best price for land through the market. It further attempts to absolve the state of any responsibility towards those impacted by the project.


This is a politically convenient stand to take as it ensures that any opposition to land acquisition is to be dealt with by the corporates themselves, and that any resistance is dealt with as a law and order problem only. The instances of state repression in favour of the corporate landholders in resource rich areas have increased in the recent times, and many ongoing conflicts are being subjected to police repression rather than being resolved by negotiation. In a variant of this view, the discussion paper prepared by the NAC has had some members advocating that a separate regulatory mechanism should be worked out to regulate the land markets through the declaration of a minimum land price. Whether this is in itself sufficient to control and regulate the malpractices of the private sector is open to doubt.


Another argument being put forward is that the state must be an active participant in the process of acquisition. It is argued that all land acquisition should take place through the state even if it is for private players. The NAC discussion paper goes into this issue in some length and elaborates it as the view articulated by one of its members. The argument made is that the state can acquire land for both public and industrial purposes. In its own press release, the NAC stated that state should acquire land “for any other purpose useful to the general public including companies if 70 per cent of the project affected people give their written consent.” Proponents of this argument contend that any direct acquisition by private parties will only lead to greater intrusion by land mafias in resource rich areas. Here the classification of “public purpose” is not done on the basis of the intent of the land use, but on the principle that two thirds of the project affected people should agree to the land acquisition process. If this is the case, it needs to be clarified that the written consent needed for acquisition should not be only of the landholders. It should also be of the people who depend on the land in terms of seasonal and non-farm occupation since the definition of project affected people also includes these people. Though the NAC paper states this difference of opinion, it does not take any position as to which one of the systems is better, and thus it reflects the dilemma of the current public debate.




It is clear that if greater social control is to be maintained over all the land acquisition processes, then the state has to play a central role in the acquisition, rehabilitation and resettlement process. Further, the intended uses of the acquired land must follow a land use plan that has been approved by the concerned state’s legislative assembly. As stated by the NAC, and demanded by democratic forces, projects requiring acquisition of land must prove that less displacing technological and land use options are not available to them. In addition, both the project as well as the acquisition of land must have prior informed consent of the project affected people. In all cases, provisions must be made to ensure that the land is used only for the project for which it has been acquired and is not resold or transferred for profit making purposes. Any new land use should also require the assent of the Gram Sabha or any other local self-government. But even here, the definition of “public purpose” should not include activities that can yield commercial profits for the state as well as the private sector. In both cases the conditions specified for acquisition and determination of compensation should be different.


Both ownership and intent are important in the definition of “public purpose.” Public purpose can itself be classified into two broad categories. First are the state’s developmental projects of importance to the local area development, which would be bringing direct socio-economic benefits to the local residents. Here the local self-governments should be involved in the screening of the projects, and the latter’s impact on the local societies should be part of the social impact assessment. Second, in case of larger strategic and infrastructural public projects for non-local benefits, the state and local self-governments should arrive at some agreement where a percentage of the non-monetary benefits and proceeds should be invested back into the local area. This may also mean altering the design of the project. Hence the compensation from these projects should include a plan for development of the local area, apart from rehabilitation and resettlement. In both these cases, the projects should be largely state owned and the land should be acquired at the base market price determined and declared at the time of acquisition. This should be in addition to the other comprehensive measures (solatium, meeting of basic needs, employment etc) that have been suggested by movements from time to time and also discussed in the NAC paper.


If the project is commercial in nature and the acquisition is being done by the state for private industry, then the conditions of purchase should be different. The project should be screened, prior informed consent for the project must be obtained from the project affected people, and the social impact assessment should ensure that there is no adverse impact on the economy of the region. The compensation and price of purchase should be higher than the base market price (on which the land is acquired for public purposes) and should include the opportunity costs and the net present value of resources (especially in case of extractive industries), among other things. Annuities should be paid in terms of the share of the profits, in addition to the requirements of the rehabilitation plans. Further, a fund should be created to which the private sector should contribute monetarily, and which should be included in the cost of the project. The cost of any ecological and social damage to the area in which the project is located, must also be estimated and included in the project cost.


Above all, adequate rehabilitation and resettlement options, discussed at some length by the NAC paper, should be available to all the project affected people. An integrated land use plan, which is made in a participatory manner and approved by democratically elected institutions, should form the bedrock of all acquisition processes. This will ensure a pathway for a more balanced and just developmental process that does not compromise on food, livelihood and social security for the most vulnerable sections of the nation.