North Block Policy Charcha on land reforms throws up innovative ideas

The session -- somewhat similar to Modi's 'Chai pe Charcha' in run-up to general elections -- is first in the series of such interactions

As the government tries hard to build a consensus on amendments to the Land Acquisition Act, the private sector on Tuesday came out with novel ideas to strike a balance between industry and farmer interests. It suggested the government define its role in land acquisition and make a land bank, besides giving some equity in projects to farmers whose land is being acquired.

The ideas came up during North Block Policy Charcha — the first interactive session organised by Chief Economic Advisor Arvind Subramanian to discuss key policy issues of the day.

The topic of the first interactive session-land reforms-can’t be more contextual, as the government faces heat on the amendments from various quarters.

KEY SUGGESTIONS

• The government should have a role in acquiring land and make a pool, so that it can be used for various purposes
• The definition of “public purpose” be made clear in the Land Acquisition Act
• Instead of giving financial compensation to farmers after acquiring their land, it could be a better option to give them some sort of equity in the project

“One of the suggestions was that the government should have a role in acquiring land and make a pool, so that it can be used for various purposes. Another suggestion was to make the definition of ‘public purpose’ clear,” a person who was present in the meeting told Business Standard.

It was also suggested that instead of giving financial compensation to farmers after acquiring their land, it could be a better option to give them some equity in the project.

Amendment to the Land Acquisition Act, passed during the United Progressive Alliance (UPA)-II government to set a fair compensation for farmland being taken over for industrial projects, is a major change being anticipated by the industry. The government was planning to table the Bill in the ongoing winter session but it is now learnt that it might first try to get the Opposition on board.

While some of the people present in the meeting were in favour of changes to the law to make it more industry-friendly, some others suggested a status quo. Officials from the finance ministry quietly heard them without offering any comments.

“It was a brainstorming session to get better understanding on the issue. Some of the suggestions may be given as input while making changes to the law, but discussions in such interactions may not necessarily lead to an action,” the official added.   

A representative from the private sector blamed the government for troubles in land acquisition, saying industry is always made a scapegoat due to lack of capability of the government.

India’s Director at the World Bank, T V Somanathan, was the inaugural speaker at the session. He is a 1987-batch IAS officer from Tamil Nadu. Somanathan was earlier managing director of Chennai Metro Rail Corporation.

Economists, think tanks, academicians, representatives from the private sector, the finance ministry and administrative ministries attended the session that lasted for more than one hour. Officials from the ministry of rural development, urban development and industry department were present.

The session — somewhat on the lines of Chai pe Charcha (chat over tea) by Prime Minister Narendra Modi in the run-up to the general elections — is the first in the series of such interactions. There will be another one on the Goods and Services Tax (GST) later this month, where Arbind Modi, an officer from the Indian Revenue Service, who had headed the Thirteenth Finance Commission task force on GST, is likely to speak.

This is not the first time such interactive sessions are being organised by the economic division of the finance ministry. CEA Kaushik Basu had started such discussions about three years ago. The enthusiasm fizzled out gradually and now Subramanian is starting it in a new avatar.

Officials said the new CEA wanted to have a platform where people from the government as well as outside could come and share their views on crucial policy matters. It is learnt that the name North Block Policy Charcha was suggested by Subramanian himself.