Land Acquisition Norms Amended, a Welcome Step

Land Acquisition Norms Amended, a Welcome Step

Niranjan Hiranandani, MD, Hiranandani Constructions Pvt. Ltd

The Indian Government has taken a welcome step on the issue of land acquisition norms, said Niranjan Hiranandani, MD, Hiranandani Constructions Pvt. Ltd. (HCPL). He was reacting to media reports about the Union Cabinet, chaired by the Prime Minister Narendra Modi, on 29 December having approved certain amendments in the land acquisition norms. These seek to fast-track the purchase process of land, while bringing more projects under the provisions of rehabilitation and compensation of land owners.

“While the amendment has the potential to give a boost to affordable housing, it will also facilitate a scenario where infrastructure projects will be fast-tracked. For ‘Affordable Housing’ to become a reality, it will need time bound land acquisition and creation of infrastructure, which the amendment will facilitate. What is most important is that the amendment does not impact the compensation to farmers, while it ensures time-bound acquisition, it remains ‘Socially Correct’ while also being ‘Business Friendly’,” said Niranjan Hiranandani.

The amendments relate to Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, pointed out Niranjan Hiranandani, adding that while the Act came into effect from January 1, 2014; stakeholders faced difficulties in its implementation. “Among the welcome changes that the amendment brings about relates to faster processing. The Act resulted in a ‘prolonged’ process for land acquisition, and created a situation where the farmer was able to get benefit; nor could the project be completed in time for the benefit of society at large, explained Niranjan Hiranandani.

The amendments allow a fast track process for (i) defence and defence production, (ii) rural infrastructure including electrification, (iii) housing for poor including affordable housing, (iv) industrial corridors and (v) infrastructure projects; including projects taken up under Public Private Partnership mode where ownership of the land continues to be vested with the government. These projects would not need to seek the consent of 80 per cent of the affected landowners.

On the impact this would have on ‘affordable housing’, Niranjan Hiranandani pointed out that while it was clear that compensation to farmers would be high, it was obvious that the government intends to acquire land in areas where land prices are not high; and new infrastructure would be created to develop linkages to such new areas. “So, what we will see is locations which are situated at some distance from the Central Business Districts (CBDs); where new infrastructure will ensure better standards of living plus high speed transport to work places.

If one considers the concept of ‘Smart Cities’, it is obviously new areas where these will be developed – and the amended norms will help facilitate the same. If one looks at the Mumbai Metropolitan Region (MMR) for instance, the existing local train network has extended the ‘location’ of affordable housing to locations in the Vasai-Virar Region and the Karjat-Panvel Region. Infrastructure development in form of new, high-speed transport options like the Metro and new road links would create a similar situation for locations beyond Panvel and in the periphery of Alibaug; a major infrastructure project like the trans-harbour sea link between Sewree and Nhava would also make affordable housing a reality in these locations,” explained Niranjan Hiranandani.

The positive effect of the amendment, said Niranjan Hiranandani, would be visible as regards infrastructure growth. “The amendments will kick-start hundreds of billions of dollars in stalled projects,” he said. Pointing out that restrictions on buying land was among the barriers holding up projects worth almost US$ 300 billion in various sectors, Niranjan Hiranandani pointed out that about 50  per cent of China’s economic growth was not just due to manufacturing; but also a result of the urban housing revolution. “As a result of the amendment, in India too, the multiplier effect on GDP will happen due to volumes in housing unit production, and this will enhance economic growth,” he concluded.