News Wrap: India's Controversial Land Bill

India’s budget session of parliament reopened on April 20 after a short break. Building on momentum from the first half of the session, Prime Minister Modi has made clear his intention during the second half to pass a long-stalled and controversial Land Acquisition Bill, which would reduce the stringent restrictions on forced sales of land. Under the current law, forced sales of land must pass a social impact test, and require the approval of 70 percent of the affected owners. Modi already issued an executive order in December that eliminated some restrictions for certain projects—the current bill under consideration would make these changes permanent. The opposition Congress party and its allies have promised to block the bill.

Advocates of the bill argue that it will reduce obstacles for much needed development and infrastructure projects. Transport Minister Nitin Gadkari, interviewed in the Economic Times, notes that it will bring jobs and investment to rural areas.

“Frankly speaking, this Land Acquisition Bill is totally in the interest of the farmer. It will increase more employment potential in rural areas. It will create more infrastructure that will create more jobs for the youth, particularly in the rural area. It will increase irrigation and it will solve the problem of rural infrastructure. At the same time, it will ensure low-cost affordable housing for the poor.”

As the Telegraph reports, the bill has also received strong support from corporate interests in India.

“India Inc has thrown its weight behind the land bill at a time the Narendra Modi-government is making efforts to get it passed in Parliament, which convenes again for the budget session tomorrow. Industry is engaged in back-channel discussions with various political parties and states to help the bill sail through.”

Firstpost quotes Ratan Tata, industry heavyweight, who argues that India Inc. needs to give Modi more time to deliver on his election promises, and that industry players should support the government in initiatives like the Land Bill.

“There's a great deal of hope in the inspirational leadership of Modi. He is still in the early stages of defining what he hopes to deliver a new India. The implementation hasn't really taken form this year. But we still have to give him the opportunity to implement what he has promised.”

Detractors of the proposed legislation, including the farm lobby, suggest that the bill furthers India’s development at the expense of its poorest citizens. The Times of India notes that farmers, who supported Modi in last May’s elections, are strongly opposed to the proposed change.

“India's poor but powerful farming lobby flocked to Modi's right-wing BJP at the general election last May, when Modi won the biggest mandate in 30 years. But anger in rural areas has been mounting over his government's bid to overhaul land purchasing laws, compounding woes over extensive damage to winter crops due to unseasonal rain across northern India.”

A report in Forbes notes that the bill has implications for other aspects of Modi’s reform agenda.

“The new bill proposes amendments to smoothen land acquisition for key uses such as rural infrastructure, defense projects, industrial corridors, urban infrastructure and affordable housing. On it rest several of prime minister Modi’s pet programs, including the ambitious “Make in India” which emphasizes manufacturing within the country rather than importing.”