Editorial: Government land bank

By: |
Published: March 17, 2015 12:31:43 AM

Need a centralised list of land available with govt

Finance minister Arun Jaitley has done well to say the government plans to stay firm on the land acquisition Bill—it is not clear on what basis environment minister Prakash Javadekar told PTI the Bill would be passed by the Rajya Sabha this week—since getting land is one of the biggest problem facing industry today; indeed, it is not clear how the NDA will get through its plans of big SEZs and NIMZs unless the Act is amended. It is also important to clarify, given the large number of misconceptions floating around, that the land Bill does not envisage the government getting land for the private sector at non-market rates. Even under the original UPA land Act—and this has remained untouched in the NDA amendment—private sector land purchases are to be governed by rules to be set by individual state governments. That is, the private sector will purchase land on its own, but beyond a certain size of land—to be decided by each state – this land will be subject to social impact assessment and other requirements. In order to make sure the private sector pays even higher rates for the land it purchases, one way is for state governments to actively start declaring various agricultural land as suitable for commercial use. Once this is done, the prices will automatically start escalating so that the farmer gets the upside—right now, since change in land use is very tough, the real upside comes only after the land has been bought and the private sector aggregator applies for change in land use.

But as a parallel process, it is vital the governments—the Centre and the states—start quantifying the land available with them which can be used for commercial purposes. The 12 major ports, for instance, are supposed to have 2.64 lakh acres of land with them of which around 0.52 lakh acres are spare—this is the reason why road transport and highways minister Nitin Gadkari has said smart cities will be built around each major port. Similarly, the Railways have large tracts of land, but reports suggest not too much of this land has been monetised since the Railway Land Development Authority found that while it had possession of the land, the titles were not clear—this is the precise reason why the NDA under Atal Bihari Vajpayee had to put off the sale of the iconic Ashok Hotel in the capital. Similarly, there are supposed to be large land parcels with the defence forces, in various industrial estates, and even with several PSUs. Apart from letting industry know what land is readily available, even government departments need to know such details since that is the only way the land can either be monetised or used for various PPP projects—getting the private sector to participate in modernising of railway stations, for instance, critically depends on land being made available for commercial usage. Getting together details of a government land bank is not a substitute for getting the land Bill through, but it is an important complement to it.

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