The Economic Survey has asked for a “well structured eminent domain law” to put an end to the constant hold-up of land acquisition encountered by industry.
It says the government must have the role of a mediator in any new law on land acquisition so that objections raised by some farmers don’t decide the fate of industrial projects. The government must mediate and support farmers wishing to sell their land to industry.
It says setting up a new industry requires a lot of contiguous land and since these are plots held by various farmers, their interests get pitted against one another. “If we force the one farmer holding out to sell, we violate his interest, and if we abandon the project, we are violating the interests of the farmers who want to sell,” it says.
Still, the Survey is very clear that the farmer who does not want to sell land should not come in the way of the rights of the farmer who wants to sell. “Not to have a viable land acquisition policy is to compromise the rights of those who want to sell their land.. It is this that necessitates the government to step in as mediator,” it says. To leave it entirely to the market would mean giving in entirely to the hold-up problem.
It identifies the rights of farmers who wish to sell their land with the growth of industrialisation and urgently seeks a “well articulated law on where and under what circumstance and for what kind of payment can government acquire land from farmers for industrial purposes”. And, says the draft land acquisition Bill addresses these issues.
The Survey also calls for flexibility in labour laws in the interest of both the industry and workers. It says there is need to give much greater freedom to both employers and employees to voluntarily sign contracts of different kinds and then have the state recognise the contract and help enforce it. It says needs vary in a modern economy and some may need permanent labour, while some may serve demands that are volatile and need flexibility in running their labour force up and down. It says workers may also want options ranging from permanence of tenure to temporary work to earn more money. It says the price of curbing flexibility hits workers the most, as it would reduce demand and thus keep wages low.
