TABLE OF CONTENT Pg.
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Abstract 1
Introduction 2
Historical Background 2
Land Acquisition in India 3
Controversies 4
Eminent domain 5
Legislative Changes 6
INDUSTRY-AGRICULTURE NEXUS AND TRADE-OFFS 7
Food security 7
Threat to water resources 7-8
Objective 8
Employment 8
Conclusion 9
ABSTRACT
This essay discusses the issue of how farmers who lose their livelihoods as a result of
agricultural land being acquired for industrialization should be compensated. The farmers
are leasing land from a private owner or the local government with a legally required
sharecropping contract prior to ownership. The choice of the landlord to sell the land ex
post to an industrial developer and the ex-ante incentives given to tenants and the landlord
to make particular investments in agricultural production are influenced by compensation
rules. It has been demonstrated that efficiency concerns demand that farmers receive
excessive compensation in the case of conversion.
INTRODUCTION:
Paying compensation to people whose traditional livelihoods are disrupted by modern
industrial undertakings is a significant topic in contemporary development strategy. This
calls for taking efficiency and equity into account. Those who are made unemployed by
industrialization are left to the whims of the market in the lack of a welfare state.
Insufficient remuneration for these groups can have negative political and societal
repercussions that threaten the political viability of the programs in question.
In addition to its political implications, compensation policies have a significant impact on
economic efficiency. They have an impact on landowners' decisions to switch from
agricultural to industrial use. Farmers may generate surpluses that they would have to give
up in the event of eviction due to frictions in the leasing market, such as moral hazard and
low tenant wealth. There would be no private motivation for landowners to consider these
losses when deciding whether to convert their property. Thus, insufficient remuneration
may encourage unduly quick industrialization. In addition, the expectation of these changes
in the future creates a tenure vacuum for those in the agricultural industry, which affects
their willingness to make investments that raise farm output.
Over the past 20 years, these issues have become increasingly apparent on a global scale,
especially in nations that are industrializing quickly like China and India. Urban real estate
development and the conversion of agricultural land designated for industrial enterprises
have been hallmarks of these countries' transition to industrialization. Local and regional
governments have been instrumental in this process, eager to accelerate growth inside their
borders in order to create significant spillover effects and/or increase government revenue.
Farmers who are farming these fields and the laborers who work for them both lose their
jobs at the same time.
It has been suggested that the compensation given to people who were relocated is
insufficient. It has been said that the procedure used to decide on and carry out these
compensations is opaque, arbitrary, and done on an as-needed basis. There have also been
grievances raised regarding the displaced people's lack of rights and involvement in the
transition process.
HISTORICAL BACKGROUND:
The basic right to property is eliminated by the Constitution (Forty-Fourth Amendment) Act
of 1978. Prior to 1978, private property was primarily protected by two articles: Arts. 19(1)
(f) and 311. However, these sections were eliminated by constitutional revisions, leaving
private property vulnerable.
U.S Constitution in its V amendment ordains that- “No person can be deprived of his life
liberty or property without due process of law”.
In contrast to other fundamental rights, the right to property is constantly being restricted
by constitutional changes. In India, the right to property has all but disappeared. The
extensive legislation established by state and federal governments to regulate property
rights has given birth to a great deal of significant litigation in the field of constitutional law.
The payment of compensation for the acquired property rights was the central concern in
these disputes. This issue has been the subject of significant constitutional debates, and the
constitution has been changed multiple times to overcome some unfavorable court
decisions.
Art. 312 was amended several times before being finally repealed. Two articles—Article
19(1)(f) and Article 31—that guaranteed the right to property were included in the 1949
Indian Constitution. However, the 44th Amendment Act removed both of these articles. The
Forty Fourth Amendment Act of 1978 removed the subhead "Right to Property" from Article
31. In Chapter IV of Part XII of the Constitution, a new insertion known as Article 300A has
replaced Article 31(1). Article 31(1) is moved, and Article 31 is removed, indicating the
elimination of the fundamental right to property.
Under the Indian constitution, the right to property attempted to address the issue of how
to manage property and the pressures associated with it by attempting to strike a balance
between the right to property and the right to compensation for its acquisition through an
absolute fundamental right to property, which was then balanced with reasonable
restrictions and supplemented by an additional fundamental right to compensation in the
event that the state acquired the properties. item 19(1)(f), which was counterbalanced by
Article 19(5) and the compensation item in Article 31, served as an example of this. This was
an intriguing development that was influenced by the British concept of eminent domain,
but overall it struck an intriguing balance by acknowledging the state's authority to seize
property while also recognising, for the first time in India's history in a millennium or longer,
the individual's right to property against the state.
There were only four constitutional clauses pertaining to property after 1978: A. 31, 31B,
31C, and 300A3. Despite being part of the chapter on fundamental rights, A. 31A, 31B, and
31C cannot truly be referred to as such because they place restrictions on the right to
property rather than conferring basic rights. These clauses' primary goal was to shield
property rights from various laws that restrict them.
LAND ACQUISATION IN INDIA:
In India, the term "land acquisition" refers to the procedure through which the national or
state governments of India acquire property in order to carry out different infrastructure
and economic development projects. There have been several disputes including allegations
that landowners have not received fair compensation.
The Right to Fair Compensation and Transparency in Land is the legislation that governs land
acquisition in India.
The 2013 Acquisition, Rehabilitation, and Resettlement Act became operative on January 1,
2014.1.
The Land Acquisition Act of 1894 governed land acquisition in India until 2013. On
December 31st
In 2014, India's new government enacted an edict formally directing citizens to "meet the
twin
goals of farmer welfare; in addition to promptly attending to the strategic and
developmental requirements of the nation." Land Acquisition was approved by the
government.
CONTROVERSIES:
Since India's independence, the eminent domain theory has been applied extensively,
benefiting nearly 21.6 million individuals between 1951 and 1990. With the construction of
massive projects like dams, mining, sanctuaries, thermal plants, canals, and industrial
infrastructures. 4 These are typically classified as "development-induced displacement"
events. The Indian populace has shown distaste for the land acquisition procedure. The
amount paid back is reasonably modest in relation to the economy's current price index.
Additionally, Because of their poor human capital, displaced persons frequently struggle to
obtain suitable jobs.
Approximately 75% of those who have been displaced since 1951 are still awaiting
rehabilitation, according to the government's proposed National Policy for Rehabilitation. It
is important to remember that displacement is only taken into account in relation to "Direct
Displacement". Fishermen, landless workers, and craftspeople are not covered by these
rehabilitation programs. Approximately 10% of Indian tribal people are displaced
individuals. Dam projects have forced nearly a million Adivasis from their homes, and the
situation for Dalits is even worse. According to some estimates, 40% of those who have
been displaced are from tribal roots.
A growing number of social and political protests have been held against the various
industrialists' land acquisitions. In the recent past, they have come from Bengal, Karnataka,
and Uttar Pradesh.
There were protests against Tata Motors' purchase of 997 acres of land in Bengaluru to
establish a manufacturing for the nation's least expensive car. 5 Similar incidents were place
in West Bengal at least ten years before to the Singur incident, despite the silence of
opposition parties and other civil society organizations at the time. Similar to this, the World
Bank eventually canceled the Sardar Sarovar Dam project on the Narmada River, despite the
project having been built on bought property. The government was able to purchase private
land according to the Land Acquisition Act of 1894. It is the only piece of legislation related
to land acquisition that, although being altered multiple times, has not been effective.
In light of the fact that circular rates are frequently misleading, the 1894 Act's financial
recompense for displaced individuals was limited to the land's market worth. Conflicts
relating to land acquisition in India during the post-reform era have revealed three unique
inclinations:
i. Technology and rights bundle
ii. The relationship between Power Land regulations, and
iii. Vanishing commons
Important Indian political parties have fiercely opposed the Land Acquisition Amendment
Bill, which the BJP-led government is currently pushing through the Lok Sabha, claiming that
the changes are anti-poor and anti-farmers. The proposed revisions eliminate the need for
farmer consent in order to move forward with land acquisition under five main project
categories.
EMINENT DOMAIN:
The authority derived from the concept of eminent domain to appropriate someone's
property. According to the eminent domain doctrine, a sovereign can take any action as
long as it serves the public good. According to the idea, the sovereign might purchase
private land for public use as long as it is of a public nature of the utilization is unequivocally
proven. Two Latin maxims serve as the foundation for the doctrine.
(1) Salus populi suprema lex (Welfare of the People Is the Paramount Law) and
(2) Necessitas publica major est quam
Articles 19 and 31 of the Indian Constitution initially guaranteed the right to property, which
includes land. Every citizen has the right to own, possess, and dispose of property, as
guaranteed by Article 19.
"No person shall be deprived of his property save by authority of law," according to Article
31. Additionally, it declared that a person whose property was taken for public use would
get compensation. (Frequently open to a broad interpretation). The 1978 Fourteenth
Amendment eliminated the ability to property removed from the list of fundamental rights
and a new clause, Article 300-A, introduced which stated in the Constitution that "no person
shall be deprived of his property save by authority of law" 44th Amendment, effective as of
10.6.1979. The amendment made sure that the right to property is now a constitutional,
legal, and statutory one rather than a basic one. In the case that this right is violated, the
affected party may seek redress in the High Court under Article 226 of the Indian
Constitution. Under Article 32 of the Constitution, and not the Supreme Court.
Full compensation, or the market worth of the property at the time of acquisition, is
inferred by Article 31(2). "Make sure that what is determined as payable is compensation,
that is, a just equivalent of what the owner has been deprived of," is the mandate of the
Legislature. Justice, Reddy, O Chinnappa, and others decided on July 7, 1983) that the basic
right to property has been eliminated due to its inconsistency with the objectives of social,
economic, and political and "equality of opportunity and position," as well as the creation of
"a socialist democratic republic, as the Constitution intends. There is no justification for
replacing the outdated notion of property with a new one that would preserve the
semblance of the laissez-faire philosophy and establish a new oligarchy in the name of
efficiency. Among the various aspects of efficiency is yet to find an unfailing efficiency
measure that can accommodate the vastly different needs of a changing society . 6
It's interesting to note that Justice Reddy, O Chinnappa, introduced the concept of efficiency
along with the need of infallibility. With the addition of "social" components to property
rights, a new era in Indian history had begun.K. K. Mathew justice precisely said, "Property
in consumable goods or means of production worked by their owners (use aspects of
property) were justified as necessary conditions of a free and purposeful life; but when
property gave power not only over things but through objects over people (the property's
power aspect) Furthermore, it was unjustified because it was a tool of slavery as opposed to
independence7.
LEGISLATIVE CHANGES:
In addition to paying landowners compensation, the 2013 Act aims to offer livelihood losers
from the land rehabilitation and resettlement benefits, which will be in addition to the
minimum compensation. The least amount of money that must be given to the landowners
is determined by a multiple of market value and further criteria specified by the Act.
The Act prohibits or restricts the purchase of land when it involves an area that is irrigated
for several crops. The Act modified the requirements for acquiring land for use by private
enterprises or in public-private partnerships, requiring 80% of the landowners' consent.
Additionally, the Act introduced modifications to the land acquisition procedure, such as the
requirement for a social impact study carried out prior to the transaction being made.
In addition to having significant flaws in its socioeconomic effect assessment procedures,
the new law avoids the constitutional local self-governments by not designating them as
"appropriate governments" when it comes to property acquisition.
INDUSTRY-AGRICULTURE NEXUS AND TRADE-OFFS:
We shall now address the first problem. To emphasize, it is possible to generalize dualistic
models of growth—such as Lewis’ model—to support the use of agricultural land for
industrial purposes. The notion But it's not without controversy. Redirecting agricultural
land will affect jobs and food production. water, security, and additional natural resources.
These worries relate to the industrialization issue in general and not particularly to state
acquisition. Let us examine each of these issues in isolation.
FOOD SECURITY:
One of the main issues when land is used for industrial reasons is food security. According to
Du Pont's 2012 global food security index, India is rated 66th out of 105 nations. 2011 saw
India as 15th place on the Global Hunger Index (GHI). India was one of the three nations
where the worldwide The hunger index increased from 1996 to 2011. Against this bleak
backdrop, 78 of the 81 developing Some nations were able to reduce the rate of hunger
(International Food Policy Research Institute, 2011).
THREAT TO WATER RESOURCE:
Rerouting land for industrial use also negatively impacts the nearby water resources. But the
government doesn't try to evaluate the effects on water supplies, and it doesn't set any a
baseline for utilization. In this context, three main issues come up.
Firstly, the government permits businesses to use water resources in such diversions
whenever they are built.enormous amounts, making it difficult for the locals to get water.
Secondly, the groundwater recharge system may be destroyed if land is diverted for
industrial uses. As stated in the 2007 SANDRP study, once property ownership is
established, the right to collect groundwater is unalienable. Industries can produce
enormous amounts even in a very small region. of water, causing the nearby wells to dry up.
As per the 2005 Memorandum of Understanding signed by the project's water supply from
POSCO-India and the Government of Orissa will be routed from the Jobra barrage that
receives water from the Mahanadi River's upstream Hirakud dam. POSCO predicted that it
will need 3.5 cubic meters of water every second for their steel plant, which equates to
7000 crore liters of water annually for the facility. Given the increasing strain on the Hirakud
dam, which is mainly intended for irrigation, any additional pressure brought on by
industrial use will only increase the severity of the current issues.(Report, 2010, Mining Zone
People Solidarity Group)
Thirdly, the contamination of aquatic bodies resulting from the discharge of industrial
wastewater into them. For instance, the negative effects of mining and industrial activity are
so great in Orissa's Keonjhar and Sundergarh districts that one of the region's Brahmi rivers
has been named among the ten worst. The Centre for Science and Environment (Mining
Zone People Solidarity) contaminated waterways in India 2010 Group Report).
OBJECTIVES:
Nonetheless, agricultural practices and industrialization both have comparable effects on
water resources. The primary source of it is the modernization of agriculture, with borewells
and tube wells being utilized for watering take the lead to exhaustion of water table
because of excessive extraction.
EMPLOYMENT:
Proponents of industrialization acknowledge that, in comparison to agriculture's high labor-
to-land ratio, the direct employment produced by the industries may not be particularly
significant. Still, they make a point pointing out that the creation of downstream jobs
(indirect jobs created through backward connections) could result in a significant increase in
jobs. Patnaik (2007) claims that there are issues. with this dispute. First, the effects of new
industries replacing small ones once they are destroyed is typically overlooked. For instance,
the immediate jobs that Nano was supposed to produce were approximately 2700
employees, indirect employment of 16000–17000 based on the potential around 4,500
fewer jobs in agriculture. First, it doesn't appear that the employment situation is becoming
worse. Nevertheless, focusing just on these figures presents a skewed image.
CONCLUSION:
In conclusion, as section 2 illustrates, land acquisition may be a legitimate instrument for
policymakers looking to expand our economy. However, we discussed how execution in the
last section. Failed attempts reduce its efficacy. More thought has to be given to this
outcome. Stated differently, one must look into the fundamental causes of the land
acquisition policy's failure. In a nation such as India With so many parties involved and
competing interests, the state might find it difficult to strike a compromise. numerous
stakeholders while also attending to the needs of development.
