Cabinet clears ordinance to make land acquisition easier

The union cabinet has cleared an ordinance to ease land-acquisition rules and auction minerals such as iron ore to kickstart stalled projects.

Prime Minister Narendra ModiThe amendments to the act aim at excluding five categories of projects, including defence, national security, rural infrastructure and low-cost housing exempt from strict regulations prescribed in the Act.

Finance minister Arun Jaitley, however, said the interests of farmers have been protected.

The union cabinet chaired by Prime Minister Narendra Modi today approved certain amendments to the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

The Act that came into effect from 1 January 2014 has been reported to be facing difficulties in its implementation, in view its rigid provisions.  The Narendra Modi government has brought in certain amendments to remove procedural hurdles in the acquisition of lands required for important national projects.

The amendments also aim to further strengthen the provisions to protect the interests of the 'affected families', according to a cabinet release.

Restrictions on buying land, under a law championed by the last UPA government, are among barriers holding up projects worth Rs20,00,000 crore (almost $300 billion) in sectors such as rail, steel, mining and roads.

Farmers are still to be compensated at four times the market rate for land in rural areas and twice the rate in urban areas, but the extent of consent needed for land acquisition has been trimmed considerably, especially for public-private partnerships. 

"Procedural requirements have been  relaxed - like the required consent of 70 per cent of affected landowners and a study on the social impact - provisions like that will not apply; higher compensation will apply," said the Finance Minister, referring to five types of projects that include industrial corridors around major highways.

Four-fifths of all landholders concerned in a sale must give their consent before any land is acquired for a private project. 

The ordinance will have to be cleared by the next parliamentary session which starts in February.

The government has now in its seven months in office used an ordinance six times due to a lack of majority in the upper house of Parliament or Rajya Sabha.

But a legislative logjam prevented the government from getting bills, including raising foreign holding in insurance and commercial mining of coal.