Land bill weighs on India’s farmers

The Modi government’s bid to win amendments to the 2013 land acquisition bill passed has hit a hurdle from the opposition and the farm sector. But some see good tidings in the law.

The Indian government is struggling to get the land acquisition bill passed in this session of parliament, which ends on May 8. Amit Dave / Reuters

MUMBAI // Ravi Chandran, a farmer in the southern Indian state of Tamil Nadu, does not share the views of the politicians and farmers who are vehemently opposing the government’s push for new land laws.

Narendra Modi, India’s prime minister, is trying to get amendments to the land acquisition bill of 2013 passed. The existing law states that to force any sale of land, at least 70 or 80 per cent of the owners must give their consent and there has to be a social impact assessment.

In December Mr Modi launched an emergency ordinance allowing land for certain projects to be forcibly acquired without the need for such processes. The government is trying to make this into a law, arguing that agricultural land is needed to move ahead with large-scale infrastructure and industrial “public purpose” projects to benefit the economy and population.

The new land bill is critical to Mr Modi’s economic reform process, as he strives to attract investment – and it is proving to be a major hurdle. Those who fiercely oppose it say that it will deprive farmers of their livelihoods, with the hugely political issue reaching boiling point when a farmer from Rajasthan hanged himself at an Aam Aadmi Party rally against the reforms last month in New Delhi.

But Mr Chandran, who farms 60 acres of land – 10 acres of which he owns and the remainder on lease – believes that Mr Modi’s planned changes could help the rural population.

“Industrialisation of rural areas would help the village folks to augment their income,” he says. “Lack of opportunity is the reason for exodus to towns.”

Farming is often economically unviable, he says.

“The reality is in spite of our best efforts, we are unable to make good profit from farming that we could sustain upon with this meagre income. The majority of farmers are marginal farmers owning less than two acres.”

Even in a good year, such a farmer in India earns less than 50,000 rupees (Dh2,883) annually and often needs to have another source of income, Mr Chandran says.

He believes that the farmer opposition to the reforms has been “blown out of proportion” by the opposing political parties and the media.

“When I interacted with many farmers, they are not aware of the bill,” he says.

The government is trying to get the bill passed in this session of parliament, which ends on May 8, but it is struggling to win the support needed.

Rahul Gandhi, vice president of the opposition Congress party, has accused Mr Modi of being pro-corporate and anti-farmer, portraying him as trying to snatch land and livelihoods from the poor.

Mr Modi’s land acquisition reforms would only apply to land for particular uses: defence, affordable housing, rural infrastructure, industrial corridors and public-private partnerships.

“Currently most of India’s usable land is in agriculture, which produces 16 per cent of GDP,” says Kamal Sen, the president and chief executive of Cogitaas, a consultancy. “Obviously, more land has to shift to industries, infrastructure, power generation, urbanisation and the services industry, which increases GDP and productive employment.”

He explains that agriculture “is becoming unviable without government support” and many farmers do not want their future generations to go into farming.

“The point for Indian agriculture is not the quantity of land used, but its productivity. Indian agriculture, mostly stuck in food grains production, has some of the lowest productivity per acre measures, whether for food grains or for other agricultural uses,” says Mr Sen. “Farmers can produce three to four times more, on less land, if agriculture reaches world-class productivity.

“Making farming productive and profitable is the main issue – which involves many factors like technology, scientific cropping, water conservation, crop insurance, etc, rather than just quantity of land used in farming.”

Unseasonal rains in a number of states, which have destroyed crops, have added to the woes of farmers.

Farmers in rural areas would be offered four times the market value for the acquisition of their land. But there are other factors that need to be considered, Mr Sen says.

“At the village level there should be a system of advisory, guiding and management systems that give displaced people full rehabilitation, with secure livelihoods, with some stake in the future development of their area and full help in restarting their lives.”

The Confederation of Indian Industry (CII) highlights that the amended land bill would help create millions of much-needed jobs in India, which has a population of more than 1.2 billion. With more than half of its citizens under the age of 25, millions are entering the job market each year.

“The land acquisition ordinance could not have come at a more opportune time when developmental infrastructure and industrial projects worth crores [crore=10 million] of rupees are delayed due to hurdles in land acquisition,” says Sumit Mazumder, the president of the CII. “This deprives millions of landless people of job opportunities and forces them to migrate to urban slums to look for livelihood.”

The amended bill is “pro-farmer pro growth”, he adds.

The United States has also weighed in, urging India to resolve its land acquisition issues to attract funds for infrastructure projects and smart cities.

“Land acquisition, foreign direct investment and other questions still remain unresolved,” the US ambassador Richard Verma said, addressing the annual general meeting of the American Chamber of Commerce in New Delhi, the news agency Ians has reported. “The expectation of large amounts of private sector finance, either domestic or foreign will be a challenge. These concerns mean many projects may not be commercially viable at the outset.”

Mehul Thakur, the director of Viva Homes, a Mumbai-based developer, says that the amended bill would make land acquisition a “faster and smoother” process to the benefit of the country’s economic growth ambitions.

“Most of the land parcels are held up by small farmers and gathering consents from all is a long process which leads to cost overruns and delay in completion of projects,” says Mr Thakur.

Mr Chandran says he knows many farmers who have voluntarily sold their land to property developers in exchange for large amounts of money and they saw it as an opportunity to exit the struggle of making a living from farming.

“For instance, the 45km stretch between Mayiladuthurai and Thiruvarur, which passes through my town, you can see lot of real estate plots carved out of farmland.”

He adds that he thinks his land would be unlikely to be acquired under the amended land bill because his farm is situated in such a remote area.

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