Not to be left behind, Chandrababu Naidu makes it easy to acquire land in Andhra too

Andhra Pradesh CM N. Chandrababu Naidu | Facebook

The Andhra Pradesh amendment simplifies the land acquisition process into a singular agreement with the district collector.

New Delhi: In its efforts to develop Amaravati as the state capital, the N. Chandrababu Naidu government in Andhra Pradesh has managed to achieve what the Narendra Modi government has been struggling with ever since it came to power.

On 30 May, President Ram Nath Kovind approved the state’s amended provisions to the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation, and Resettlement Act (LARR), passed by the Congress-led UPA government in 2013.

The amendment effectively eases restrictions on government’s ability to procure private agricultural land for large-scale projects — one of the biggest obstacles in infrastructure development.

It simplifies the land acquisition process into a singular agreement with the district collector, and allows the state government to write off the rehabilitation and resettlement promise for specific projects by paying a hefty sum up-front. Further, it completely exempts projects that fall into the categories of national security, defence, and irrigation, among others, from consent and social impact assessment requirements.

In its first year in office, the Bharatiya Janata Party-led National Democratic Alliance (NDA) government attempted to pass nearly identical amendments at the Centre but failed to tweak the legislation in the face of fierce opposition and farmers’ protests, including from BJP’s own Kisan Morcha. The NDA pushed the LARR ordinance thrice in Parliament but could not muster the numbers in the Rajya Sabha at the time. The ordinance finally collapsed in August 2015.

With the new amendments, Andhra Pradesh joins the exclusive club of a handful of states — Gujarat and Rajasthan in 2016, and Maharashtra, Telangana and Jharkhand in 2017 — which managed to circumvent what they consider to be LARR’s obstacles to development.

Andhra Pradesh’s requirements 

The bifurcation of the state in 2014 to create Telangana resulted in the undertaking of numerous infrastructural projects by the government, including the development of Andhra Pradesh’s ambitious new capital Amaravati, to be spread over 33,000 acres of land.

The projects required expedited land acquisition for which the Naidu government in 2017 implemented the contentious land pooling scheme (LPS) over the more rigid LARR act. The LPS allowed the government to acquire the land on a ‘voluntary’ basis from the farmers with the promise of returning a developed piece of land in the city under construction.

The new amendments will further assist the government in developing the state capital.

What is LARR Act?

Prior to the historic passage of the LARR Act under the UPA regime, the colonial era Land Acquisition Act, 1894 was still in effect. The law failed to account for India’s socialist-democratic vision, as they were written by the British to preserve and further institutionalise India’s status as a colony.

Private property theorists argued that enforceable property rights form the bedrock of not only a democracy, but a functional free-market, as they prevent the unnecessary interference of the state in the economy.

The 2013 Act was an attempt to balance powers between the state and landowners. It expanded the definition of landowners to include those whose livelihood had been affected by land acquisition; introduced a new formula that brought compensation in accordance with the market value of the property; and also established mandatory rehabilitation and resettlement of those who lost their land.

Further, it required acquiring parties to get the consent of 80% of the landowners in the case of companies and 70% in the case of public-private partnerships.

Within one year of the Act’s implementation, both the central as well as various state governments were already trying to dilute it.

Bypassing Parliament

Despite its failure to amend the LARR at the central level, the NDA government continues to encourage states to work around the move.

The NITI Aayog’s 2017 India Action Plan — a vision document — mentions the need for “reforming land/property related laws,” in order to achieve the government’s goals.

PM Modi’s ‘Make in India’ initiative and the state-wise Ease of Doing Business rankings by the World Bank and Department of Industrial Policy and Promotion (DIPP) have only further consolidated the narrative of large-scale industrial projects being good for the economy, for which the setting up of infrastructure is a prerequisite.

Andhra Pradesh and Telangana ranked first in the 2016 Ease of Doing Business rankings, scoring 98.78 per cent.