Kamal Nath, Union road transport and highways minister, has proposed that any land acquired by NHAI be returned to the original land holders if project work is not initiated within five years. This proposal differs from the provisions of the Land Acquisition (Amendment) Bill, which says that the land acquired for a private project will vest in the government; it does not revert to the original land holders. Land acquisition for projects is a controversial issue, and it is useful to examine the various proposals.

There are three major objections to the Land Acquisition Act, 1984. First, the type of projects for which land may be acquired compulsorily. Second, the amount and mode of compensation to the owners of the land. Third, the rehabilitation of the owners as well as others whose livelihoods are affected by the acquisition. These issues are addressed by the Land Acquisition (Amendment) Bill and its companion Rehabilitation and Resettlement Bill.

Currently, land may be acquired for “public purpose”, which has a broad definition. It includes land needed for village sites, town or rural planning, land for residential purposes for the poor, for development (including education, health or slum clearance) or if it is needed by a public sector entity. The act also permits acquisition for use by a private company for any work that is “likely to prove useful to the public”. This clause has been interpreted broadly to include employment creation.

The amendment bill specifies that land may be acquired only for three purposes: strategic defence requirements; infrastructure projects (roads, rail, bridges, power, ports, etc); and for a company if 70 per cent of the land is already purchased through market mechanisms. This last condition is contentious. One argument is that land is just one more resource for an industrial concern. Just as they acquire other resources (raw material, capital, etc), they should purchase the required land. After all, no industrialist wants to go back to the days when IPOs were priced by the government; if that is abhorrent, why should land identification and pricing be done by the government? On the other side, the argument is that the government should facilitate land for industrialisation. The land market in India is very inefficient, and titles are not clear in most cases. It is not practical to expect private companies to identify a large number of small land holders, check titles and purchase land.

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