States may be allowed to acquire 30% land for industry

State governments may be allowed to acquire up to 30 per cent of land for industry instead of the 10 per cent at present.

This proposal has been discussed and "is under the active consideration" of the Group of Ministers (GoM) set up to draw up a resettlement and rehabilitation policy. The Land Acquisition Act will be amended after the GoM submits its report.

Speaking to Business Standard, Minister for Rural Development Raghuvansh Prasad Singh said, "State governments deal with land acquisition. The issue of letting states acquire up to 30 per cent of the land for industry will be sent to them for their consideration and comment."

A majority of the members in the GoM are in favour of the 70:30 formula where industry acquires 70 per cent of land and the state government hands over the remaining 30 per cent, according to the minister.

The move shows that the GoM has given in to industry, which has been voicing concerns over the stiff opposition to land acquisition for the Special Economic Zones and industrial parks in different parts of India. At its heart, the proposal envisages smooth handover of land to industry by the state government without being dogged by conflict.

Even after the state government had acquired land, in some cases like Singur, locals have threatened industry with physical harm unless they were adequately compensated.

The earlier draft policy envisaged state governments' role in acquiring land only to the extent of 10 per cent. Industry itself was to have bought the rest of the land. This was to have been subject strictly to the contiguity principle.

"Contiguity will continue to be the criterion for acquisition by the state. Only when private players face problems in acquiring land will the state government intervene," Singh said.

The GoM will have its last meeting next week, and will finalise the policy. "After this meeting, it is likely to go to the Cabinet," he said

"The resettlement and rehabilitation policy is so important that if the Cabinet raises new issues, the GoM may have to consider it again," Singh said indicating that a national level policy may take time.

The National policy for Resettlement and Rehabilitation of Project Affected Families, 2003 ( formulated by the NDA government) came into force in February 2004. Stating that the policy was severely lacking various provisions under rehabilitation, the UPA government formulated a new policy in 2006. The draft policy, which went through numerous changes at various levels, is now the subject matter of the GoM.

On the issue of compensation also there are still some differences. While some of the members opine that the compensation can be a one-time settlement, others differ.

"First of all, there should be no forcible displacement. Wherever possible, land for land should be provided for the project affected. Apart from providing livelihoods, they should have a share in profits of the project," Singh said.