New Land Acquisition

Act 2013: Ensuring

inclusive growth in
India
D K Ojha

Ushering in of new land acquisition norms have opened up new vistas of growth.
Its time that government and public sector entities put together their
perspective development planning detailing their long-term strategies for future
infrastruture growth.
Rapid industrialisation is critical for maintaining the growth of any economy. However, in recent
times it has been observed that land acquisition has become a limiting factor in Indias
industrialisation. Land Acquisition for major economic projects has shot to national attention lately
capturing media space and invading the language of informed discourse. Hence, it became
imperative that a new land acquisition act was ushered in in-order to streamline the land
acquisition mechanism in India in a manner that balances the interests of affected families with the
need of the infrastructure industry. In a country like India, the stakeholder management is a never
ending task of balancing and integrating multiple relationships and multiple objectives. A strategy
focussing on management of stakeholders is critical for the success of big infrastructure projects in
India. It is important to understand concerns of stakeholders and come up with an innovative
approach to resolve issues involving them.
It points out to the essentiality of inclusive growth model, that India cannot leave Bharat (Indian
villagers) far behind without risking major conflict. To address historical injustice, the Act applies
retrospectively to cases where no land acquisition award has been made.

Ever since its enactment, the The Land Acquisition Act, 1894 has been subject to controversies
and fierce debate. Notwithstanding rounds of amendments, including the 1984 changes, it has
failed to address some important issues associated with land acquisition particularly forcible
acquisitions, definition of "public purpose", widespread misuse of "urgency clause", compensation,
lack of transparency in the acquisition process, participation of communities whose land is being
acquired and virtually no rehabilitation and resettlement package. Further, weak implementation
and ineffective administration at the ground level has increased the suffering and anguish of the
people. Due to a lack of clear definition of "public purpose", there has been considerable difference
of opinion among various judgments of the Supreme Court of India, finally resulting into granting
very broad discretionary powers to the State in terms of deciding the contours of "public purpose"
under particular circumstances. All these factors coupled with the urgent need to industrialise have
put land acquisition at the heart of the debate in India. In view of above, it requires fresh
application and interpretation in the light of the dynamic context of an emerging economy and a
nation in transition.
Despite being amended from time to time the Land Acquisition Act, 1894 had outlived its utility. It
was in this background that the Government of India enacted a new law for land acquisition namely
Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement
Act, 2013 which introduced a number of changes over and above the existing 1894 law on land
acquisition in India.
This is the very first law in India, that links land acquisition and the accompanying obligations for
resettlement and rehabilitation in to a single Act. It mandates a Social Impact Assessment (SIA) of
the proposed acquisition by an independent body comprising the representatives from Gram
Sabha (village council), Panchayats (Local level self-government) and Municipal Corporations and
will carry out the assessment on the suitability of the purpose, minimal acquisition, families to be
displaced etc. within six months of its commencement.
For projects undertaken by private companies or through public-private partnerships, the Act
requires the consent of 80 per cent of the affected people, which will put a check on forcible
acquisitions. The Act guarantees higher compensation to the land losers and adopts the market
value method to compute compensation. The claim for compensation of "affected family" has been
endorsed by providing a broad definition to the term which includes sharecroppers, agricultural
labourers, tenants whose primary source of livelihood stands affected. Central to this Act is the
identification of the public policy and the role of the executive, industry, judiciary and civil society
in achieving the fine balance between equity and effi ciency in infrastructure development in India.
In the soul of the new Act are fair compensation, thorough resettlement and rehabilitation of those
affected, adequate safeguards for their well-being and complete transparency in the process of
land acquisition.
Given the inaccurate nature of circle rates, the Act provides the payment of compensations that are
up to four times the market value in rural areas and twice the market value in urban areas and
thereby rule out problems of unwarranted claims and issues of inadequate compensation. It points
out to the essentiality of inclusive growth model, that India cannot leave Bharat (Indian villagers)
far behind without risking major conflict. To address historical injustice, the Act applies
retrospectively to cases where no land acquisition award has been made. Also in cases where the

land was acquired five years ago but no compensation has been paid or no possession has taken
place then the land acquisition process will be started afresh in accordance with the provisions of
this act.
To safeguard food security and to prevent arbitrary acquisition, the Act directs states to impose
limits on the area under agricultural cultivation that can be acquired. In case land remains
unutilised after acquisition, the new Act empowers states to return the land either to the owner or
to the state land bank. Where the acquired land is sold to a third party for a higher price, 40 per
cent of the appreciated land value (or profit) will be shared with the original owners.

Conclusion
A comprehensive, participative, inclusive and meaningful process has been put in place under new
land acquisition Act prior to the start of any acquisition proceeding. Based on the propositions of
required quantum of consent and Social Impact Assessment, it can be inferred that the process of
land acquisition under the new law will be much slower. Further, because of propositions of R&R,
higher rates and compensation even for livelihood losers land acquisition is set to become much
more expensive in India. Thus the financial viability of the projects is likely to be affected due to
anticipated delays and substantial rise in the cost of the land. In light of this, the Project
Implementing Authorities must reformulate their policies regarding need of land for their
upcoming projects. Optimal use of land should become a top priority and the process for land
acquisition and rehabilitation and resettlement needs to start much earlier. This would lead to
balanced and inclusive growth of social, political, economical and infrastructure development by
better stakeholders participation. Governments and the Public Sector Enterprises need to put in
place the perspective development planning that details their long term strategies by fixing
milestones and timeframes for accomplishing goals in respect to their anticipated land
requirements for future infrastructure growth of India.

D K Ojha is Director (IPMD), Ministry of Statistics and Programme Implementation.

The views expressed here are solely those of the author in his private capacity and do not in any
way represent the views of Ministry of Statistics and Programme Implementation or any other
entity of Government of India.