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LAND POOLING IN AMARAVATI

Background

When the Indian State of Andhra Pradesh was bifurcated in the year 2014, the new state of
Andhra Pradesh was in need of a Capital, but as most of the top brass infrastructure was
situated in and around the city of Hyderabad there was shortage of wealth in the State of
Andhra Pradesh. The Andhra Pradesh Reorgaization Act, 2014 was passed by Parliament of
India to address some of these issues. To address the problem of inadequate funds, Section 94
of the Andhra Pradesh Reorganization Act, 2014 provided for appropriate financial assistance
by the Central Government to the State Government including Tax incentives and also
financial assistance for building the capital, Raj Bhavan, Assembly and for the development
of Backward areas in the State of Andhra Pradesh. But the most pressing need for the then
Government was to have a Capital City in the state. In March, 2014 the Central Government
formed an expert committee chaired by Shri K.C. Sivaramkrishnan to conduct studies and
make recommendations as to the location of the new capital of State of Andhra Pradesh. The
Expert Committee had submitted its recommendations on 31st-August-2014. But the
recommendations of this Committee were only advisory in nature and it was the prerogative
of the State Government to select the location. The Expert Committee broadly had the
following criteria, Availability of water (ii) Connectivity (iii) Favourable climate (iv)
Proximity to existing large urban Centre capital Land availability, suitability and cost an ease
of construction (v) Cost of ease of construction (vi) Topography (vii) Centrality (viii)
Defence and security concern (ix) Historical significance. The Committee had considered
four zones for this purpose, Vijayawada-Guntur zone, Visakhapatnam, Nellore, Tripall (Near
Tirupati). But out of all these zones the Vijayawada-Guntur zone comprising Thulluru,
Tadepalli and Magalgiri Mandals of Guntur was ranked the first primarly due to their
connectivity by both road and water aby virtue of The national highway between Kolkata-
Chennai (NH-16) which is also a part of the golden quadrilateral and highway from Pune-
Machlipatnam (NH-65) and the Kakinada and Machilipatnam Ports which are of close
proximity to the Capital region, abundant water-resources by virtue of the Krishna-Delta and
Vijayawada and Guntur were ranked first and second respectively in Connectivity, first and
third respectively in Regional Development and second and third respectively in Water
resources. The State Government after considering all these issues had chosen the
Vijayawada-Guntur zone for the Capital region and named it Amaravati, the peoples’ capital.
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What is Land Pooling ?

Land Pooling is one such project wherein the Government takes large tracts of land develops
them and returns a part of the developed land to those who had given the lands. In the
Amaravati context, Land Pooling is defined under Section 2(22) of the Andhra Pradesh
Capital Region Development Act, 2014 as, “assembly of small land parcels under different
ownerships voluntarily into a large land parcel, provide it with infrastructure in a planned
manner and return the reconstituted land to the owners, after deducting the land required for
public open spaces such as parks and play grounds, social housing for economically weaker
sections, social amenities such as school, dispensary and other civic amenities, road network,
and other infrastructure as specified under the Act as well as such extent of land in lieu of the
cost of development towards the provision of infrastructure and amenities and other costs and
expenses to be incurred for the scheme and external trunk infrastructure.”

The difference between Land Pooling and Land Acquisition

Land Acquisition

Land Acquisition is a process wherein the land is acquired from the land owners and a
compensation is paid in return. The Act provides acquisition for the purposes of
industrialisation, development of essential infrastructural facilities and urbanisation. The
Land Acquisition Act, 2013 provides for greater compensation for those whoose land has
been acquired by the Government for the sake of development. The amount spent too would
be public money. For the landqcquisition scheme to succeed there must be a robust tool to
determine the value of the lands. Usually the records of the sale transactions are looked into
to ascertain the value of the types of lands. But this may not always provide a true picture as
there may be inconspicuous transactions to evade Tax.1

Land Pooling

Land Pooling is a process under which the government is handed over by the land owners and
in return the government returns a smaller but developed tract of land in return as the value of
the land would rise post development in that area. The land owners would further receive
social benefits like monthly pensions, subsidized food and even tax incentives.

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Land Pooling in the context of Amaravati

The Government of Andhra Pradesh then had an ambitious project of building Amaravati, the
peoples’ capital which when developed, would be a well-planned city. The State Government
adopted the policy of Land-Pooling through which the state promises landowners a smaller
but developed plot of land in the future in exchange for current landholdings. These
reconstituted plots would come with smart utilities and infrastructure such as citywide WiFi
access, paved roads, sewage pipes and electricity lines. The government realised this model
could encourage landowners’ buy-in by giving them a stake in the future capital. This would
lessen the pressure on the State’s finance as the medium of exchange would be land. The
Government of Andhra Pradesh by taking wisdom from states like Gujarat and Rajasthan had
taken this call. This exercise undertaken by the then Government of Andhra Pradesh is
unprecedented as it is the first time in the country wherein such huge tracts of lands are being
collected.The Governmet persuaded 25,000 farmers and obtained 30,000 acres of land in 60
days of implementation of the scheme. The state of Andhra Pradesh in the year 2014 had
even passed its own law for Land Acquisition.2The said Act titled the Andhra Pradesh Capital
Region Development Authority Act, 2014. This Act created the Capital Region Development
Authority which has the power to power to acquire, hold and dispose of property, both
movable and immovable.

The process of Land Pooling adopted in Amaravati

The Capital Region Developing Authority first creates a list of the lands which are eligible
under the LPS scheme. The same Authority holds a lottery for the land from village to village
and creates the final list of the farmers whoose property has been collected. The same is sent
to the Planning Department of APCRDA. The quantum of the land to be returned and the
benefits given, would be allocated as per extent under the head of residential, commercial
etc., however the extent that will be allotted may vary and depends on the nature of land
transferred, referred supra. The surplus land would vest with the Andhra Pradesh Capital
Region Development Authority which may either utilize to build capital or for Public
purposes or transfer for consideration or to lease out to other individuals or legal entities etc.,
for a specified object. The Government of Andhra Pradesh in exercise of powers conferred
under Sub-Section-5 of Section-43 of Andhra Pradesh Capital Region Development
Authority Act, 2014 confered the Andhra Pradesh Capital Region Development Authority
(APCRDA) which does the Land Pooling in the Capital City area wherein the land parcels
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owned by individuals or group of owners are legally consolidated by transfer of ownership

rights to the Authority, which later transfers the ownership of a part of land back to the
landowners for undertaking development of such areas. This is completely voluntary. 3 For
every one acre of land, in accordance to its nature, 1000 sq. yards of Residential plots and
250-450 sq. yards of Commercial plots will be given to the land owners. For the loss of crops
an annuity of Rs. 30,000 to 50,000 per acre with 10% annual increase is being given for 10
years. For the first year (2015-16) an amount of Rs. 128.92 crores have been paid as annuity
and Rs. 141 crores have been released for the second year. Additionally, one-time payment of
Rs. 100000 per acre for gardens having lime/sapota/guava/amla and jasmine plantation is
being given.

Pandalaneni Srimannarayana and Ors. v. State of Andhra Pradesh4

3
http://documents.worldbank.org/curated/en/956761486979973088/pdf/Resettlement-Policy-Framework.pdf
4
Pandalaneni Srimannarayana and Ors. v. State of Andhra Pradesh, MANU/GT/0124/2017.