KOLKATA: The West Bengal government, which is asking investors to directly acquire land for projects, is also thinking of retaining the ownership of the land, adding to the raft of controversies that has dogged the state’s industrialization efforts.
The state doesn’t appear comfortable with the idea of allowing ownership rights to the investors who will pay for the land. “We are working on a model where the ownership of land will remain with the government, despite the investors directly negotiating and compensating the land losers,” Sabyasachi Sen, principal secretary for commerce and industry, said. This should not pinch the investors as it will be no different from the price they pay for long lease agreements (of 99 years) that they sign for the land acquired by the state, he feels.
But some top investors—potential and actual—term this as a bad move.
The “government cannot take such a rigid stance on the issue,” said Hemant Kanoria, vice-chairman and managing director, Srei Infrastructure Ltd, a company which has an in-principle clearance for an auto-component special economoc zone (SEZ) at Kharagpur on 247 acres of land. He has heard of the proposal and thinks it is unfair. “There has to be a balance between the land acquired by the corporates and that by the government. Lease can happen only where land acquisition is facilitated by the government,” he said.
The state government has come under sharp criticism particularly after the police firing at Nandigram over farmer protests on the acquisition of land. Clashes at Nandigram have killed 20 people in the past three months, 14 of them in police firing. That’s offset government’s efforts to acquire land for industrial and infrastructure projects and pushed it to review its own role in the acquisition process. With the Union government also advising states to steer clear of the acquisition process, the West Bengal government had finally come around to the view that prospective investors should directly acquire the land they need. But the new proposal has thrown another spanner in the works.
“Where is the question of lease from the state government, when we are directly acquiring the land ourselves? It cannot happen,” Venugopal Dhoot, chairman of Videocon Group, told Mint.
As the government is yet to come to a decision on this, the proposal has not been officially communicated to the investors. Dhoot finds it hard to believe that the government could even consider such a proposition. His group company, Videocon Realty and Infrastructure Ltd, is currently acquiring 2,667.6 acres in North Bengal for a multi-product SEZ. The company was earlier expecting the government to facilitate land acquisition for its other two SEZs proposed in another northern district and at Kharagpur for another 2,825.68 acres.
It is now proposing to get into direct acquisition in these projects too, but has put the process on hold, waiting for the storm created over Nandigram to blow over. The proposed investment between the three SEZs is Rs2,000 crore.
“If it’s true, it will definitely be detrimental to investments into the state,” said Pawan Ruia, chairman, Ruia Group, who was planning to invest Rs3,000 crore in a ship-building, repair and breaking project supplemented by a thermal power plant and a steel plant, on 2,000 acres at Nandigram. He is now talking of halving his investment for just a stand-alone ship-building project, which he hopes will be accommodated on 250-200 acres of land available with the Kolkata Port Trust. “Where is the practicality in such a proposal (of retaining ownership with the government)?” he asked.
The West Bengal government has worked long to implement land reforms in the state towards an equitable distribution of land. Now, in its drive to industrialize the state, it is faced with the daunting task of acquiring vast tracts of land in highly-fragmented holdings. Its rather drastic initiatives in the direction, including a land acquisition law that allows forceful acquisition for the betterment of the economy, has stirred up a controversy.
Aparna Harish contributed to this story.