People's Democracy

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


No. 25

June 24, 2012

Illegal Projects, Land Grab and

Corporate Capitalism in Tribal Regions


Archana Prasad


THE Parliamentary Standing Committee on Rural Development has submitted its report on the Land Acquisition and Rehabilitation Bill 2011. In the discussion on land acquisition in tribal areas, especially the scheduled V and schedule VI areas, it has noted that the bill has no specific provisions for tribal areas even though clause (2)(1) of the proposed legislation explicitly states that the acquisition process will have to follow the state laws for protection of tribal lands. It also recommended that land acquisition in tribal areas should be a last resort and should have the explicit consent of panchayats and autonomous district councils.


Following this the minister for tribal affairs called upon states to stop land acquisition of mining in areas where Maoists were spreading their base. By making the connection between spread of ‘Maoists’ and the land alienation of tribal people, he has assumed that the penetration of corporate capitalism in scheduled areas can be limited by stopping the process of land acquisition. However, recent instances of corporate land grab in the scheduled areas have shown that industrial houses are resorting to benami deals in order to circumvent the formal processes pf acquisition and expedite their projects that appropriate local natural resources.

The loopholes in state laws protecting tribal land rights need to be addressed if the formal processes of land acquisition are to be effective.




There are explicit laws for the protection of tribal land rights in scheduled areas. The Chhattisgarh Land Code, the 1970 Act of Andhra Pradesh and several other laws in Madhya Pradesh, Jharkhand and Odisha prohibit the transfer of tribal land to non-tribal people. Yet even before the advent of corporations in mineral rich areas the acquisition of lands by non-tribals through tribal mediators took place. For example, in states like Madhya Pradesh the kin of politicians and senior bureaucrats acquired land in the name of tribal people and built large sugarcane farms and houses on them. In some cases, like the outskirts of Madhav National Park, senior retired officials from the centre bought large tracts of land from the tribal landholders in the buffer zone of the parks and thereafter made them work as domestic servants in their own houses. Thus benami transactions have been commonly used by the ruling classes to control tribal land and lead to the further destitution of working class tribal people.


However, the question of benami has acquired a new significance under the neo-liberal regime. With the opening up of the tribal areas through privatisation of the mineral sector and infrastructure corporate houses have expanded their operations in tribal areas. However, not all these operations are legal in character as they do not wait for necessary acquisition procedures as well as forest and environmental clearances before they start their projects. As one report in the Down to Earth (journal of the Centre for Science and Environment) showed, power companies in Chhattisgarh were using benami deals to hasten project implementation circumvent formal procedures. Hence the Avantha group of companies had started their power project even before they had approached the government to acquire 358 hectares of land (of which about 50 hectares is tribal land) for the project. This is only one power project in Chhattisgarh. There are 70 other coal thermal power projects coming up in mineral rich areas and most industrial houses seeking to benefit from these projects have purchased lands in the name of some tribal servants or guards employed by them or even unknown tribal people. Hence the Sarada Energy and Mineral Limited purchased 24 hectares of land in the name of three tribal people for Rs 2.5 crore in Janjgir Champa.


But Chhattisgarh is not alone in such deals. In Madhya Pradesh the foundations of illegal mining operations are laid down by benami land deals. An investigation by Tehelka magazine showed that in the Satpura Forest Range of the Betul district (Madhya Pradesh), illegal mining operations were carried out on patta lands given tribal people for farming under the Forest Rights Act. Mining companies routinely leased out such lands for illegal mining operations from tribals who have been granted farming rights inside the forests.


Similar illegal mining operations are rampant in Andhra Pradesh. The Centre for Economic and Social Studies, Hyderabad, pointed out that bauxite mining in the Araku Valley used the lands of small tribal farmers for their illegal mining operations. In many cases the Andhra Pradesh Mineral Development Corporation acted as a front for private companies and taking over lands of small farmers.




These patterns of corporate penetration have impacted the tribal societies in fundamental ways as the benami transactions are not directly done between the company and the land owner. Companies usually use elders or prominent tribal citizens of the village to buy lands from several tribal families. They finance these tribal mediators and then lease out the lands for building their projects. The most prominent case is that of Sandeep Kunwar, the son of the Chhattisgarh home minister who bought lands from several tribal families for a power company. The land was bought at one third the rate of the selling price prescribed by the state government. Thus the tribal land owners got a far lesser price than they would have got if the state acquired their land for public purposes while the tribal mediator made good commission


from the power company. But the emerging tribal middlemen are not only highly connected persons with political links. Poor tribal people from below poverty line families are also being used by corporate to buy lands. Thus one village elder bought land from 12 tribal families in Janjgir Champa in Chhattisgarh for Rs 3.36 crore for Videocon company. It is obvious that he himself did not have the money to pay for this land and the corporate house provided the money.


In this way the practice of leasing out parcels of land follow a two stage process where tribal mediators are first identified and then they purchase lands for the company. These tribal mediators may be village elders, politically linked tribal families with shares and stakes in the companies doing mining or building power plants. In one such report Tehelka magazine documented that families of Congress and BJP MLAs in Madhya Pradesh own many mining companies that are carrying out illegal operations in mineral rich areas like Sehore and Betul. These companies pay money to middlemen (many of whom are themselves tribals) who in turn give tribals a paltry sum of Rs one lakh per hectare to lease out their lands. Many of these lands are patta lands distributed under the Forest Rights Act and in clear violation of the law. Thus companies are supporting and facilitating the emergence of tribal in the land markets. This phenomenon is relatively new as it involves not only a politically powerful class of tribal elite (which existed during state capitalism) but also many ordinary tribal families who are not either politically connected or even large wealthy land owners within their own villages.


The emergence of this class has implications for political practice within the tribal areas. The emerging class differentiation makes it imperative that working class tribal people are organised to protect their land rights. This is particularly true of regions where tribal people are getting pattas on forest lands for farming. At the same time it is important to fight a land acquisition law that aims to ease the way for corporate into tribal regions. However for more effective protection of tribal land rights it is also necessary to strengthen the existing state laws that prevent benami land deals and ensure their just application. Thus the question of acquisition cannot be delinked from the need to curb illegal corporate practices that threaten to start a parallel system of land acquisition. Any law for land acquisition must thus have effective provisions that penalise companies that indulge in such unfair practices.