Modi 100 days: Centre moves fast on changes in Land Acquisition Act to take states on board

In an attempt to make the process of acquiring land simpler, and address concerns of the industry as well as several States, the BJP-led government moved swiftly towards bringing about sweeping changes in the Land Acquisition Act within a month of taking charge at the Centre.

In the first move, a meeting of all State revenue ministers was called by Union Rural Development Minister Nitin Gadkari in June wherein suggestions were sought from all States on the changes that need to be brought about in the legislation to ease problems on the ground.

The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill was enacted last year by the Congress-led United Progressive Alliance government and was touted as a landmark legislation. The Act has been criticised by the industry and certain other sections for making land acquisition not just phenomenally expensive, but more complicated and time consuming.

The Rural Development ministry submitted a list of suggested amendments to Prime Minister Narendra Modi mid-July based on the changes recommended by States, which included doing away with the consent clause for Public Private Partnership projects, removing the requirement for mandatory Social Impact Assessment study and relaxing the retrospective clause.

A key suggestion calls for ?re-examining? the consent clause. Currently, prior consent is required from 70 per cent of the affected families if land is being acquired for Public Private Partnership projects and from 80 per cent in case of private companies.

The ministry has also suggested doing away with the mandatory Social Impact Assessment study, confining it to large projects/PPP projects, ?as it may delay the acquisition process?. Under the current Act, SIA is mandatory and it has to be completed within six months. Modification has also been suggested to the controversial ?Retrospective Clause?, claiming it leads to ?increased burden on state exchequer?, and also to litigations. The report also suggests narrowing the scope of people eligible to receive the Rehabilitation and Resettlement benefits under the Act.

Finance Minister Arun Jaitley, speaking at the Express Adda recently, said defence, affordable housing and some of the infrastructure projects should also fall within the exempted category.

Officials in the ministry say, if enacted, these changes would lead to a complete revision of the Act. While Gadkari?s predecessor Jairam Ramesh has criticized the move, stating the BJP had been brought on board for the Act?s passage, sources in the current government claim it is not a political move since even the Congress ruled states have demanded changes.

Interestingly, some of the Congress-ruled states were the most vocal in opposing certain provisions in the existing Act and instrumental in pushing for the suggested amendments. Internal documents mentioning each state?s view on every issue raised accessed by The Indian Express show the most crucial proposal ? of removing consent clause from PPP projects or alternatively, bringing it down 50 per cent ? was pushed by both Haryana (Congress ruled) and Kerala (ruled by Congress-led UDF), besides some other states. On the definition of affected family, which the ministry has proposed to narrow down, Congress-ruled states like Assam, Himachal Pradesh and Haryana all felt the scope was too broad. On the issue of Social Impact Assessment ? which the ministry has proposed to scrap except for large projects/PPP projects ? Karnataka, Kerala, Maharashtra and Manipur all demanded the process should be restricted to only large projects.

Meanwhile, some states like Rajasthan are set to take their own course on the issue by firming up their own, more industry-friendly Land Acquisition Act. The Rajasthan government is said to be working on a new Act, doing away with key provisions like consent and SIA. While land is a state subject, land acquisition falls in the concurrent list.

Having submitted the report to the PMO, the ministry?s efforts in this direction now seem to have hit a slow patch. Government sources say the BJP would not be keen to be seen as pushing what can be viewed as ?farmer-unfriendly? changes when it is facing key assembly elections, particularly in states like Haryana and Maharashtra where farmers constitute a key electorate.

The intention behind the BJP government?s move has been to fast track acquisitions and ensure the legislation, in the name of protecting the interest of farmers, does not become a hindrance to development and completion of important projects.