Wednesday, 22 April 2015

New Land Bill: Not a Zero-Sum Game

Image Courtesy: Google

It is unfortunate that the debate over the new land acquisition rules is being reframed in the context of the so-called ‘rich-poor’ and ‘industrialist-farmer’ divide.

Those who are giving this issue a divisive colour in the pursuit of narrow political ends are actually doing a great disservice to the nation.

In the hullabaloo, we seem to have lost sight of the fact that the larger agenda in front of the country today is poverty eradication.

For that to happen, we need to create public infrastructure, which will provide the necessary fillip to the Make-in-India program, which in turn will boost manufacturing and job creation in the country. Our attempts at lowering poverty and bringing prosperity to rural areas will fail if there is no land available for infrastructure to come up.

What the Modi government's land bill aims to do is make the acquisition of land for infrastructural projects easier by moderating some of the restrictive provisions in the previous land acquisition law of 2013.

Standard Chartered Bank had estimated that if land buyers have to mandatorily obtain consent of 80% of landowners, as stipulated previously, the process would typically take 4-5 years. No wonder then that infrastructure projects worth over $100 billion remain stalled, robbing the economy of millions of potential jobs.

As it is, India is ranked 142nd out of 189 countries in the World Bank's 'Ease of Business' list. Persisting with such restrictive rules would spell disaster for the government’s efforts to kick-start the investment cycle and catapult India to a strong growth trajectory.

Farmers Interests Will Be Protected

Those opposing the new land acquisition bill are making it out to be a zero-sum game in which the government can either benefit industry or the farmer.

The government has actually taken an approach that balances the interests of farmers and the ease of land availability for development projects.

However, there seems to be a deliberate attempt to paint a misleading picture of an “anti-poor” and “pro-industry” government colluding with ‘Big Business’ to usurp farmers’ lands. Nothing can be further from the truth.

In fact, the new land bill increases the likelihood that landowners will be compensated fairly, not only in terms of their land but also in terms of their jobs and livelihood. It seeks to not only ensure compulsory employment to one member of the family affected by the land acquisition but also proposes a hassle-free grievance redressal mechanism for them.

A Development Agenda for our Farmers

What India needs today is a development agenda aimed at lifting small and marginal farmers out of poverty. They need to be empowered, their children need to be educated and given the opportunity to compete for mainstream jobs. They have to be given the chance to improve their quality of life.

For farmers to prosper, people and resources need to be reallocated away from low-productivity segments to more efficient ones. One of the ways to do it is through co-operative farming. Small agricultural holdings need to be merged to form larger co-operative units to allow for adoption of mechanised cultivation.

They also need to be encouraged to move up the value chain. With food processing gaining importance in India, there is an opportunity to do exactly that. As food processing as a sector is more labour absorptive and less capital intensive vis-à-vis textiles and apparel, investment in this sector can lead to the large-scale employment thus pulling many out of the rut of subsistence farming.

However, if all this is to become a reality India will need to build the necessary infrastructure. So, I think it is time to update former Prime Minister Lal Bahadur Shastri’s slogan of ‘Jai Jawaan, Jai Kisaan’ to ‘Jai Jawaan, Jai Kisaan, Jai Nirmaan!’

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