Land Acquisition

Andhra Pradesh wants to dilute the Central land acquisition law – and that could harm farmers

The amended rules may allow for some projects in the state to be exempt from Social Impact Assessment and food-security related protection.

The state government of Andhra Pradesh is preparing to amend The Right to Fair Compensation and Transparency in Land Acquisition Act, 2013 in order to acquire land for the new proposed capital city of Amaravati, in the footsteps of the Gujarat state government. A move of this kind will greatly disadvantage the farmers whose land is at stake, compromising their rights. In an interview, Kanchi Kohli, the Legal Research Director at the Centre For Policy Research-Namati Environment Justice Program, explains this in greater detail.

Can you explain the specific provisions in The Right to Fair Compensation and Transparency in Land Acquisition Act (RFCLARR), 2013, and how these provide protection to farmers’ lands?
There are few provisions in the RFCLARR, 2013 that look to strengthen the position of those whose lands are being acquired or whose livelihoods and rights would be affected by the acquisition. One is the need for prior consent of 70% to 80% of land owners depending on whether a project is a public-private partnership or entirely private sector owned. Another is a thorough Social Impact Assessment to determine all people affected (other than land owners), and a process for determining and putting together a Rehabilitation & Resettlement plan. There are also provisions relating to the repatriation of land or possible higher compensations, in case it has remained unused.

Can you explain the Social Impact Assessment in more detail?
Broadly speaking, SIA is a process to understand the nature and extent of impacts on lives and livelihoods of people living in or dependent on the land being acquired. Although there are apprehensions expressed by industry and its associations that the SIA process will lead to delays in land acquisitions, at least two aspects of the SIA process as prescribed under the RFCLARR, 2013 are critical for a democracy.

  • One of the first objectives of the SIA is to determine whether the acquisition is for a ‘public purpose’ or not, as land cannot be acquired under the 2013 law otherwise.
  • Second, is to determine the people who would be affected by acquisition of the land, including farm labourers, users of a forest, pastoralists, artisans and several other occupations that have always been left out of the rehabilitation and compensation processes. This process needs to be carried out by the District Collector in collaboration with the panchayats, gram sabhas and municipalities and a public hearing has to be conducted to ascertain if the impact assessment is adequate. It is only after this that a Social Impact Management Plan is prepared.

What are the proposed amendments and how would these dilute the Act?
The Principal Act of 2013 allows states to create rules under the Act (Section 109). If one is to go by this news report, the Andhra Pradesh government is seeking to move amendments similar to that carried out by Gujarat. One significant change is the introduction of a section, which allows for some projects to be exempt from the SIA and food security related protection (discussed below).

According to the national legislation, SIA is mandatory and multi-cropped land is to be acquired only in exceptional circumstances. However, the Gujarat state rules, drawing from the 2014 ordinance put out by the Central Government, exempts defence and national security projects; projects related to rural infrastructure; affordable housing; industrial corridors of state governments and its undertakings; and infrastructure projects, from SIA and food security related safeguards – effectively rendering these protections invalid.

If Andhra Pradesh were to adopt similar amendments for the acquisition of land for the new state capital, the rights of land owners and those tilling the land, could be seriously compromised.

How can the Act be interpreted differently from state to state? And with respect to that how have the amendments played out in Gujarat?
In our working paper, co-authored with Debayan Gupta, we have tried to assess how Section 109 has been used in nine states and how it affects sections such as consent, SIA, determination of compensation, and applicability of the food security clause. While some of these amendments are in the form of clarifying procedures or giving clear timelines for processes, others are seeking to work around the national rules, which state governments find cumbersome to implement.

It is yet to be empirically assessed how these amendments have played out in Gujarat.

Is Andhra Pradesh government changing its land acquisition procedures​, and how will this affect the farmers of Amaravati?
As has been widely reported, Amaravati is the new capital for Andhra Pradesh following its bifurcation in 2014. The state government has lauded it to be a people’s capital with state-of-the-art infrastructure and is seeing it as an opportunity to create a world class city. A land pooling scheme has been put in place by the state government to bring together the 33000 acres of land required for the construction of the city, which reportedly several farmers have responded to positively.

However, the state government’s current move is to acquire the remaining land which that has not been pooled in through the acquisition process. The news report quotes the Agriculture Minister assessing this land at almost 6,000-8,000 acres. With the proposed amendment this would happen without an SIA and acquisition would be possible as food security safeguard provisions would not apply. More importantly, the livelihood dependence on this area would neither be assessed nor compensated for.

What is the likelihood of other states following suit? And if there is a domino effect of this kind, how can people’s rights be protected eventually?
A RFCLARR ordinance of 2014 and the proposed amendments to the 2013 Act drawing from the ordinance, had already put the above mentioned idea on the table. Large-scale opposition within the parliament and by farmer’s organisations led to the setting up of a Parliamentary Standing Committee. This Committee had received several technical submissions, including by CPR-Namati Environment Justice Program, on the legal and constitutional tenability of the proposed amendments.

Even though the national law has not been amended so far, several provisions put forth have been built into the state rules. For instance, some states like Telangana, Andhra Pradesh, Gujarat and Tripura have proposed to do away with prior consent entirely.

Since the focus of the amendments to this law has shifted to the state rules and land acquisition is a process entirely under the administration of the state governments; it is important for us to follow these proposed amendments closely. Whether it is enhancing the national provisions, protecting safeguards or reversing the dilutions will require an active engagement of many interested in democratic decision making in India.

This article first appeared on the website of The Centre For Policy Research.

We welcome your comments at letters@scroll.in.
Sponsored Content  BY 

Want to retire at 45? Make your money work for you

Common sense and some discipline are all you need.

Dreaming of writing that book or taking that cruise when you hit your 40s? Well, this dream need not be unrealistic.

All it takes is simple math and the foresight to do some smart financial planning when you are still young. If you start early and get into the discipline of cutting down on unnecessary expenditure, using that money to invest systematically, you can build wealth that sets you free to tick those items off your bucket list sooner than later.

A quick look at how much you spend on indulgences will give you an idea of how much you can save and invest. For example, if you spend, say Rs. 1,000 on movie watching per week, this amount compounded over 10 years means you would have spent around Rs 7,52,000 on just movies! You can try this calculation for yourself. Think of any weekly or monthly expense you regularly make. Now use this calculator to understand how much these expenses will pile up overtime with the current rate of inflation.

Now imagine how this money could have grown at the end of 10 years and overcome the inflation effect if you had instead invested a part of it somewhere!

It is no rocket science

The fact is that financial planning is simpler than we imagine it to be. Some simple common sense and a clear prioritization of life’s goals is all you need:

  1. Set goals and work backwards: Everything starts with what you want. So, what are your goals? Are they short-term (like buying a car), medium-term (buying a house) or long-term (comfortable living post-retirement). Most of us have goals that come under all the three categories. So, our financial plans should reflect that. Buying a house, for example, would mean saving up enough money for up-front payment and ensuring you have a regular source of income for EMI payment for a period of at least 15-20 years. Buying a car on the other hand might just involve having a steady stream of income to pay off the car loan.
  2. Save first, spend later: Many of us make the mistake of putting what is left, after all our expenses have been met, in the savings kitty. But the reverse will have more benefits in the long run. This means, putting aside a little savings, right at the beginning of the month in the investment option that works best for you. You can then use the balance to spend on your expenditures. This discipline ensures that come what may, you remain on track with your saving goals.
  3. Don’t flaunt money, but use it to create more: When you are young and get your first jobit is tempting to spend on a great lifestyle. But as we’ve discussed, even the small indulgences add up to a serious amount of cash over time. Instead, by regulating indulgences now and investing the rest of your money, you can actually become wealthy instead of just seeming to be so.
  4. Set aside emergency funds: When an emergency arises, like sudden hospitalisation or an accident, quick access to money is needed. This means keeping aside some of your money in liquid assets (accessible whenever you want it). It thus makes sense to regularly save a little towards creating this emergency fund in an investment that can be easily liquidated.
  5. Don’t put all your eggs in one basket: This is something any investment adviser will tell you, simply because different investment options come with different benefits and risks and suit different investment horizons. By investing in a variety of instruments or options, you can hedge against possible risks and also meet different goals.

How and Why Mutual Funds work

A mutual fund is a professionally managed investment scheme that pools money collected from investors like you and invests this into a diversified portfolio (an optimal mix) of stocks, bonds and other securities.

As an investor, you buy ‘units’, under a mutual fund scheme. The value of these units (Net Asset Value) fluctuates depending on the market value of the mutual fund’s investments. So, the units can be bought or redeemed as per your needs and based on the value.

As mentioned, the fund is managed by professionals who follow the market closely to make calls on where to invest money. This makes these funds a great option for someone who isn’t financially very savvy but is interested in saving up for the future.

So how is a mutual fund going to help to meet your savings goals? Here’s a quick Q&A helps you understand just that:

  1. How do mutual funds meet my investment needs? Mutual Funds come with a variety of schemes that suit different goals depending on whether they are short-term, medium-term or long-term.
  2. Can I withdraw money whenever I want to? There are several mutual funds that offer liquidity – quick and easy access to your money when you want it. For example, there are liquid mutual funds which do not have any lock in period and you can invest your surplus money even for one day. Based on your goals, you can divide your money between funds with longer term or shorter term benefits.
  3. Does it help save on taxes? Investing in certain types of mutual funds also offers you tax benefits. More specifically, investing in Equity Linked Saving Schemes, which are funds that invest in a diverse portfolio of equities, offers you tax deductions up to Rs. 1.5 lakhs under Section 80C of the Income Tax Act.
  4. Don’t I need a lot of money to invest in MFs? No, you can start small. The returns in terms of percentage is the same irrespective of the amount you invest in. Additionally, the Systematic Investment Plan (SIP) allows you to invest a small amount weekly, monthly or quarterly in a mutual fund. So, you get to control the size and frequency of your investment and make sure you save before you spend.
  5. But aren’t MFs risky? Well many things in life are risky! Mutual funds try to mitigate your risk by investing your money across a variety of securities. You can further hedge risk by investing in 2 to 3 mutual offers that offer different growth stories i.e. a blue-chip fund and a mid-cap fund. Also remember in a mutual fund, your money is being managed by professionals who are constantly following the market.
  6. Don’t I have to wait too long to get back my returns? No! Mutual Funds, because of the variety of options they offer, can give you gains in the short or medium term too.

The essence of mutual funds is that your money is not lying idle, but is dynamically invested and working for you. To know more about how investing in mutual funds really works for you, see here.

Disclaimer: Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

This article was produced by the Scroll marketing team on behalf of Mutual Funds Sahi Hai and not by the Scroll editorial team.