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  1. India Inc tepid to changes in Land Act

India Inc tepid to changes in Land Act

While India Inc welcomed the waiver of the social impact assessment (SIA) and the consent clause for specific areas...

By: | Mumbai/new Delhi | Published: December 30, 2014 4:30 AM

While India Inc welcomed the waiver of the social impact assessment (SIA) and the consent clause for specific areas, including projects in the public-private participation (PPP) mode, industry was concerned that the compensation to be paid to those who sold them the land remained high and also that it been extended to more sectors. Companies were also apprehensive about taking on the resettlement and rehabilitation (R&R).

Sunil Kant Munjal, joint MD, Hero MotoCorp, told FE the move to ease the conditions for some areas was welcome but added it could have been done for other sectors too. Munjal felt industry might not mind the high compensation if it was not made responsible for resettlement.

“We can pay but don’t make us responsible for resettlement. That should be left to a government agency,” he said.

K Venkatesh, managing director and CEO, L&T IDPL, felt the compensation to sellers was steep. “One reason why projects are stuck is the high compensation,” Venkatesh said.

He added, however, that land acquisition would now be easier since the consent clause and the SIA had been waived for projects in specific areas, including PPP projects where the land would vest with the government.

“However, the government will need to make the necessary allocations in the budget to acquire land,” he pointed out.

Virendra Mhaiskar, chairman and MD, IRB Infra, observed that with national highways coming under the ambit of compensation, NHAI would need to pay more for land. “However, that may actually speed up the process of acquiring land,” Mhaiskar said. While NHAI has been keen to use the EPC route, it may be forced to allocate a smaller amount for such projects since it would need to spend more on land.

Niranjan Hiranandani, chairman, Hiranandani Group, observed that it would have taken at least three to four years acquire land if the SIA was mandatory and consent of 80% landowners was to be taken. “There is no other way to speed up the process of land acquisition than waiving these conditions,” he said. Hiranandani called for clarity on some issues, including the clause relating to the duration for which land could be held if not developed. “While this duration has been increased from 5 years to 10 years, in some sectors the development happens in phases, so the project may or may not be complete in the 10 years. It could be cumbersome if the company is required to go back again and acquire more land,” he explained.

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