Land locked

Ravi Sinha

Not that Hitender Tyagi of Noida was a prosperous landlord, yet he felt like the one with his small  12-acre holding of agricultural land. Today this ailing farmer feels like a pauper who was forced to part with his sole source of livelihood as his land was forcibly acquired by the Noida Authority. The compensation was too meagre to give him any long-term financial security. With no other ‘job skills’ this 58-year-old man was unfit as well as too old for any other job. The compensation money too, was soon spent and today his family lives in penury.
“My son bought a car with the compensation given to me and is now working as a driver. My daughter-in-law works as a domestic help in the nearby apartment blocks that have been constructed on the land that once belonged to us. It makes me cry my heart out but I am not alone to suffer this kind of cruel injustice by the government. Now when I am told about the new law coming that can make any farmer lose his right over the land as and when the rich want it and the government is a party to it, I feel a collective suicide is better for us than to see our children working as servants on our very own land,” says a dejected Tyagi.

Contentious issue
Land acquisition in India has always been a contentious issue and the urban planners for long were calling for a need to amend the Land Acquisition Act of 1894. Following some violent protests and legal logjam post land acquisition in many parts of the country, the government in 2007 and 2011 tried to address the issue and finally came up with the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act in 2013. This Act laid down the process for land acquisition that removed the urgency clause on part of the State and prescribed Social Impact Assessment Survey, Preliminary Notification stating the Intent for Acquisition, a declaration of acquisition and compensation to be given by a certain time. All acquisitions required rehabilitation and resettlement to be provided to the people affected by the acquisition.  
However, Industry in general and real estate in particular termed the 2013 Act unreasonable that could make land acquisition a very cumbersome process for the Industry. The grouse was that it was proving to be a major bottleneck for reviving infrastructure development and green field investment.
Hence the BJP Government in December, 2014 amended Section 10(A) of the Act to expand sectors where assessment and consent was not required. For five sectors, the consent clause was removed. Now the government or the private developers no longer need mandatory consent of 80 per cent of land owners for acquiring land in those five sectors.   

Industry welcomes amendments
As expected, the industry and real estate sector cheered the new provisions. Analysts within the built environment even expressed that the dream of ‘Make in India’ could become reality only with enabling provisions for industrial corridors and defence purposes. The sector even welcomed the Ordinance ‘way to go’ for the feasibility of government’s ambitious plan of ‘Housing for All by 2022’. There was a general feeling that exempting industrial corridors from the consent clause would boost the commercial activity as well along such corridors.
Anshuman Magazine, CMD of CBRE South Asia maintains that the amendments will have a positive impact on the infrastructure and real estate sector. Feeling hopeful of the new norms to ease off the inordinate delays seen so far in the land acquisition process for large scale infrastructure and affordable housing projects, he says the infra industry, in particular, is expected to gain much from these new changes, as will housing for the poor.
“I hope this is just the first step in amending the Land Acquisition Act, as much more amendments are required to ease land acquisition procedures in India. It could perhaps bring in more segments of organised real estate within the ambit of such faster processing norms, which would be beneficial for construction activity across the country,” says Magazine.

Niranjan Hiranandani, CMD, Hiranandani Group says the government has taken a welcome step on the issue of land acquisition norms, having approved certain amendments in the land acquisition. These seek to fast-track the purchase process of land, while bringing more projects under the provisions of rehabilitation and compensation of land owners.

“While the amendment has the potential to give a boost to affordable housing, it will also facilitate a scenario where infrastructure projects will be fast-tracked. For ‘Affordable Housing’ to become a reality, it will need time-bound land acquisition and creation of infrastructure, which the amendment will facilitate. What is most important is that the amendment does not impact the compensation to farmers, while it ensures time-bound acquisition, it remains ‘Socially Correct’ while also being ‘Business Friendly’,” says Niranjan Hiranandani.
Rohit Raj Modi, President, CREDAI NCR says it is expected to boost much needed infrastructure development and housing construction in the country. “The likely changes in the Act that includes removal of consent clause for land acquisition for affordable housing, rural infrastructure and industrial corridors would prove to be a game changer. The Act is likely to benefit affordable housing segment the most and would help achieve the government’s ambitious plan of ‘Housing for all by 2022’”, says Modi

Home buyers not impressed
Such optimism of the real estate developers, however, fails to impress the home buyers who feel that the free-for-all land acquisition law would only help the developers. Sandeep Acharya, a home buyer from New Chandigarh points out that the government may be giving a feeler that more compensation and rehabilitation offered to the farmers would escalate the home prices, and “it is not well founded”. He reminds how in several cases the financial burden on the developers post the additional compensation to farmers due to judicial intervention was nullified with extra FSI/FAR granted to the developers.

“Even when the developers were given extra FSI/FAR to compensate their business profitability after the court order to grant additional money to the farmers, they still increased the cost of  flats. I feel this fair justice and compensation to farmers is an alibi not for the homebuyers’ interests but to safeguard the interests of the big industries who want land at cheap rates,” adds Acharya.

As per rough estimates, restrictions on buying land are among the main barriers holding up projects worth almost $ 300 billion in various sectors.

However, before the issue of whether the amendment and the Ordinance would kick-start hundreds of billions of dollars in stalled projects could be answered, the government found itself in rough waters as there is a growing discontent across the country over the Ordinance and the debate has spilled over from Parliament to the streets with various political parties, pressure groups, farmers and activists taking to streets against what they call a draconian law to snatch the farmers’ land.

Though the government is now sending out feelers that it is ready to consider suggestions on the Land Acquisition Bill, there hardly seems to be any consensus emerging to address the issue with the consent of all the stakeholders, including the farmers, industries, developers, socio-political groups and homebuyers.

— The writer is CEO, Track2Realty

Impact on consumers

• Free market transactions cheaper from pricing standpoint
• Land Acquisition from government agencies often leads to litigation, affecting delivery timelines for home buyers  Benefits of easy acquisition through government agencies not passed on to homebuyers
• If the Ordinance becomes law it would benefit buyers only through better public infrastructure around projects.