It all began in Singur

Singur 2008 was a watershed. The land market changed forever. Sellers began to adopt new methods to ramp up the compensation value. And industry has begun to economise on land use.

In a way, the compensation game on the ground seemed to anticipate the Land Acquisition (Rehabilitation and Resettlement) Bill. Today, there can be no turning the clock back.

Yes, but it all began in Singur — or should we say Kharagpur? In the middle of the last decade, when the Tatas expressed interest in investing in a small car project in the State, they were first offered a strip of uncultivable or mono-crop land, connected by highway and rail network, near Kharagpur.

Most of the identified land was vested with the government, thereby limiting the scope of any fresh acquisition. The company was fine with the offer. They had existing group facilities in the region located around 100 km from Kolkata and the group hub in Jamshedpur.

Last-minute change

But, just when everything was in order, some wise men felt the auto hub should come up nearer the metropolis. The Tatas picked the irrigated and multi-crop land at Singur.

No one knew the land owners. No one bothered to find out if the farmers had another opinion.

The State decided that the villagers would part with the land in the interest of the nation, and issued notifications under the Land Acquisition Act, 1894, citing “public purpose”. (This is what governments across the country always did, either for a genuine cause or to pave the way for real estate development.)

What happened thereafter is history.

Heavy-handed use use of a law converted an economic opportunity into a socio-political mess. Tata Motors made an unceremonious exit from Bengal in October 2008.

But they were not alone to be surprised. Somewhere along the way, the tide had turned.

Nationwide trend

For decades, Indian business and politics had exploited the State’s domination on the land till it exploded in their faces.

The anti-land grab movement that began in 2005 at Dadri (Reliance Power) in UP, reached a logical conclusion in September 2008, when the farmers of Raigad voted against Reliance’s proposed SEZ in India’s first-ever referendum on land acquisition.

The rules of the game were changed forever.

Beginning 2008, not many state governments dared to slap acquisition notices. The mineral-rich states (like Odisha and Chhatisgarh) were quick to implement elaborate rehabilitation and resettlement (R&R) programmes. The others preferred to opt for market purchases from land owners.

Convincing people, rather than coercing them, in selling their land at mutually beneficial terms, is the new order of the day.

From this perspective, there is nothing new in The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill, 2012, that is now set to replace the century old Land Acquisition Act – except for acknowledging a political reality. It sets the benchmark for compensation deal (four times the market rate in rural areas and two times in cities and towns).

New complexities

With land becoming a scarce resource, one can safely assume that the market-price multiplier will act as a minimum floor rate for the future bargain.

The Government expects that high prices will act as a catalyst to create a land market for industry, within the existing framework of eminent domain. Hopefully it will. But the process is unlikely to be smooth.

Last year, a private sector captive coal miner offered a hefty Rs 17 lakh an acre, over and above the R&R package spelt out by the state, for acquisition of non-cultivable land in Odisha. But, the villagers stalled the negotiation. They demanded jobs as well.

Offering employment is no solution either. In 2009-10, Mamata Banerjee, then the Railway Minister, asked railways to offer jobs for land, for laying a track in one of the poorest districts of West Bengal.

Last heard, the project is scrapped, not due to paucity of land but for more complex reasons. The promise of jobs created a thriving land market along the proposed track, leading to fragmentation of holdings to the lowest possible decimal.

Naturally, for every inch of land, there were more job seekers than Railways could ever anticipate. And, many or most of them were ‘outsiders’. Add to this the poor land records in rural India and there were often more than one job seeker for the same land!

Coal India, too, has fallen victim to such generous offers. Two years ago, the state-run miner improved its R&R policies with enhanced scope to offer jobs and cash against land. As a result, the settlement process became slower.

There are cases, as in Talcher in Odisha, where projects requiring a small patch of land are stalled, as villagers want CIL to acquire a few hundred acres more so as to ensure jobs for everyone.

A higher compensation deal threw open greater investment opportunities for land sharks.

Need for state planning

Looking back, the historic anti-land grab protests and the resulting political upheaval has left us with some positives.

A coal-bed-methane exploration company has brought down its land requirement in Bengal to one third. Introduction of modern technology helped aviation authorities reduce land requirement for new airport projects.

A mega sized private sector power plant has come up in Gujarat at a fraction of land requisitioned by the state sector. And, IT companies are learning to give up the luxury of working from sprawling campuses.

But, there are some concerns as well. The new regime may demand states to engage in long term land planning. The case in point is the huge land bank created by Tamil Nadu Industrial Development Corporation through regular purchases since mid 1990.

Alternatively, India may witness rise of land operators, who will be responsible for integrating the fragmented holdings for industry.

Recent reports suggest, five-years since the automobile factory was relocated, Singur is now in the grip of land mafia, with a few hundred acres already having changed hands. With the Banerjee-led state government now keen to see industry back, they are integrating the smaller plots.

The ‘unwilling farmer’, who had put up a stiff resistance against the state, now have little choice before the muscle flexing of local goons.