Land reforms crucial to bolster investment

Land usage policy and the acquisition process in India are big impediments to growth and development of Nation. Several big projects, may be private or public, are trapped for the land acquisition. The forest and tribal land doesn't permit productive usage of mineral resources.

The development of tribal belt is stagnant due to restrictions on the private transfer of tribal land. India must resolve these problems through appropriate policies and regulations in the public interest. That will boost overall investment, particularly in the infrastructure, core sector, mineral and energy and thus boost GDP growth and reduce poverty ratio. However, such reforms need strong political will at center and state level.

India has about 16 per cent share of the world population as against 2.6 per cent share of land causing land deficit. Hence, India must ensure productive and efficient usage of land for the Nation's prosperity. Total land in India is about 3.30 million square KM and its' approximate usage and classification is mentioned below.

Out of balance 33 per cent land, industry & mines (including plantation, residential colonies and related structures) might occupy below 2 per cent. The growth of mines and industries has been highly compromised and converted India as an import hub of the mineral, energy and the manufactured goods. Even the public infrastructures are also facing problems.

About 10 per cent of forest land has dense forest, about 50 per cent is having moderate forest and about 40 per cent of forest land has nominal or nil trees. It is not prudent choice while keeping the scattered and thin forest that too, in the small patches. India must shift thin and moderate forests and develop dense forests in a planned manner. India should release about 7-8 per cent of the forest land (about 2 per cent of country land) for the productive usage without affecting the total dense green cover. Such land must be directly added to the "Land bank" of government.

We can't afford losing mineral wealth below the ground. There should be a reverse restriction on the usage of major mineral bearing land for other purposes, as applicable for coal. We must also amend forest dweller act, which crafts entry barrier to the development process. We can shift the forest, agriculture and dwellers to other areas but we can't shift the mineral deposits. This is more relevant since, most of the mineral bearing zones are in the forest area and mineral resources are precious for modern economy.

Agro productivity per acre in India is below 50 per cent compared to many countries. This can be boosted through investment in technology and irrigation infrastructure. Thus, the part of agro land can be released for other productive usage without compromising the agro production with judicious compensation to farmers.

There is continuous migration of population to urban cities in search of jobs and "Rojggar." Such migrated population don't get cheap house due tohigh land prices in cities. I believe that, there is no prudence in permitting the forest or agro activity in the land attached to cities. Those activities must be shifted and the land be released for residential and commercial purpose and the green cover may be developed in a planned manner.

Simultaneously, FSI normsfor multi storied buildings should be doubled for using vertical space. It will provide affordable houses to the urban poor. The commercial space will become cheaper andboost economic activities. Costlier urban land has increased the cost of living and economic activities. Thus, we have converted India as high cost economy; that must be eased.

The restriction on transfer of tribal landin scheduled districts has crafted a big impediment for the development of tribal districts. The PESA act has not benefited tribal. Such old dated laws have deprived tribal population for takingbenefits of modern economy and kept them in poverty. India must amend these laws and fetch prosperity in the tribal belt.

Unlike other countries, substantial land in India is under private ownership, that too, in fragmentedplots. Government also owns several scattered and smaller plots. Such fragmentation prohibits the entry of any large project seeking a larger patch of land. Therefore, India must allow mergers, exchange, mutual transfers for creating larger plots; that will ease the problem to a large extent. However, the land records may be digitized for quick transfers.

Despite changes in land usage policy, the land acquisition might be necessary forthe large industrial projects which need larger patch of land at single location. For this, Land acquisition bill-2013 may be amended. A few recommendations are as under; these are not exhaustive.

l For acquiring land, the land owner's consent may be obtained from 51 per cent owners in terms of land holding. Prior to land acquisition, negotiated purchase may be encouraged and such purchased land may be treated as a part of the consent. Socio economic benefits arising out of the project must be publicized before acquiring land.

l During negotiated purchase, the market price of land will obviously shoot up. Hence, the compensation cost for the balance acquisition may be maximum1.5-2.0 times of market value for avoiding dissent among those land owners, who have sold their land immediate prior to acquisition. The exchange of land to other location may also be allowed without stamp duty. The cost of structures must be reimbursed. It should also be insured that, the loss of regular income from the land is adequately compensated.

l However for such projects, which can't be shifted such as, linear infrastructure, mines and adjoining land for expansion, the consent may be exempted.

Aforesaid changes in the land usage and allocation policies and Acts will facilitate both private and public sector investment and benefit economy on multiple fronts leading to prosperity of nation. However, such radical reforms need crafting of public opinion in favor.

(The author is Non-Executive Director of Shiva Cement and Advisor of Shivom Minerals)