Land Acquisition Bill: Experts weigh pros and cons

The cabinet has given its seal of approval for the Land Acquisition and Rehabilitation Bill. Confirming the same, rural development minister Jairam Ramesh said the Draft Land Bill will be placed in current parliament session.

The landmark bill proposes strict norms for compensation and rehabilitation and also restricts government's power to acquire land for private projects. So how is India Inc reading this bill? While, the bill brings some relief in the form of transparency, it leaves a major lot of corporates unhappy.

"The rehabilitation and resettlement (R&R) clause will lead to a 50% increase in market costs," says Pankaj Bajaj, president of the Confederation of Real Estate Developers' Associations of India (CREDAI). To which, B Muthuraman, president of the Confederation of Indian Industry (CII), adds that the total cost involved could turn out to be a big negative. The bill, according to him, has gone overboard on costs of rehabilitation and the industry will not be able to afford to buy land.

Calling the R&R clause almost like an extortion racket, Niranjan Hiranandani, managing director of Hiranandani Constructions said, "I think it is a nonsensical position to take. Ultimately, we need a balance wherein we satisfy all the stakeholders in this case. The government is trying to satisfy stakeholders, but at the cost of development. That is the problem."

The bill does come with a few positives too. "It combines both land acquisition and resettlement and rehabilitation, providing rehabilitation and resettlement package for land owners and for people who are landless. Also, the government continues to have a predominant position in terms of purchase," Muthuraman said.

FICCI welcomes the central feature of the bill, its secretary general, Rajiv Kumar said. "According to that the government will leave it largely to the private sector to acquire land directly and will not interfere. We still feel that some of weaknesses would be addressed when it is tabled in parliament," he pointed out.

However, to Arun Nanda executive director at Mahindra & Mahindra the bill is too populist in nature.

NC Saxena, member, NAC says,