In the last 15 days, the land question (as Marxists would style it) has grabbed headlines. A 50,000 strong contingent began a march toward New Delhi demanding land for the landless to build homes. They were persuaded to end their march after the Union minister for rural development Jairam Ramesh promised to look into their demand sympathetically.
Almost at the same time, the land acquisition Bill was sent back to the drawing board. A group of ministers agreed to reduce the threshold for consent for land acquisition to 66% of the affected owners from the original 80%. The Congress party brass would have none of it and wants the 80% figure to be restored.
Viewed separately, the two issues appear unconnected. After all, the demands of the moneybags and farmers could not be more dissimilar. But viewed together, their effect on the Indian economy and their political implications are at once interesting and disquieting.
There is, of course, something sinister in the suggestion that land be taken away from those unwilling to part with it. Even the most diehard believer in the government’s right to eminent domain, or the power to take private property for public use, will agree that tempering provisions must accompany their exercise. In practical terms, the issue is one of trade-offs and their associated politics.
The simplest choice is not to acquire any land and take the country back to an idyllic rural existence. In reality, unemployment and stagnant incomes make the bulk of village India an unlivable place. Add an adverse land-to-man ratio and the picture gets even less rosy. It is not that these facts are not known. Successive governments have harped on shifting people from agriculture to industry to reduce the pressure on farming. For various reasons, that has not happened. But with the land policies being envisaged (right to land) or being put in place (the land acquisition Bill), industrialization will become even tougher.
The details need not detain us but one feature is particularly pernicious in this context and is worth mentioning here. Under the planned law, land acquisition (for public sector, public private partnership and private projects) in urban areas will be undertaken at market rates. In rural areas, however, land will become more expensive as one moves away from urban centres. “Multipliers” over the market price will kick in. These will range from 2 to 4 times the market price. For example, land close to Delhi will have a smaller multiplier; land in “the middle of nowhere” a bigger one.
The idea is perverse. If anything, it is this land that should be priced cheaply. If this feature is incorporated in the law, it will defeat efforts to industrialize the hinterland. The problem will be acute in districts where agricultural productivity is low. There is no rationale for tightening the land acquisition process in these areas; instead they need to be industrialized fast and their population shifted to a modern sector as quickly as possible.
But invert the logic; instead of economic factors, consider the politics of making industrialization harder and it makes sense. Virtually any industrial job requires more skills than farming. It is also a sad truth that citizens living in rural areas have been denied any worthwhile education leave alone any “quality” education that will equip them for better jobs. As a result, they cling to their land —even if it is unviable. It makes political sense to tell such persons that there are laws that make it impossible to take away their land. This temporary comfort is sufficiently attractive for electoral purposes. Any wonder then that it makes industrialization a bad word in our politics?
This is the “mass” level of land politics. The apex—the conditions attached to large-scale land acquisition, for example of the kind needed for Special Economic Zones—is equally, if not more, pernicious. The costs involved—land prices in multiples of market price, resettlement and rehabilitation (R&R), etc.—will make it hard for anyone but the large corporations to acquire land. In many issues associated with this process (such as the multipliers and the thresholds above which R&R requirements will kick in) state governments have been given wide discretion. In the Indian context, it can only mean one thing: cronyism.
So India may well be on its way to becoming one big, inequality-stricken, village republic; land for homes for the millions of landless at the bottom of the heap and cronyism at the top. This will lead to further calls for preventing land “alienation” further fuelling inequalities. After all, the big corporations and the middle class won’t stop growing; only the poor will get poorer.
It is, of course, unfair and irresponsible to suggest that those responsible for drafting or navigating such laws have cruel intentions in mind. What is more likely is that they are taking such steps with the best of intentions. But one cannot resist the temptation to point to the “old” politics of the Congress party: In its glory days, it depended on mobilizing the weak and the oppressed (muslims and harijans—dalits today—at the bottom and the upper two varnas at the top). The party had its favoured industrialists as well. It was only the mandal and kamandal interlude that upset this pattern. Perhaps the Congress feels that there is a good chance that its quest for the right to land will help it return to its happy days.
Siddharth Singh is Editor (Views) at Mint. Reluctant Duelist will take stock of matters economic, political and strategic —in India and elsewhere—every fortnight. Comments are welcome at firstname.lastname@example.org
To read Siddharth Singh’s previous columns, go to www.livemint.com/reluctantduelist