THE SCHOLARS’ AVENUE ²
W E D N E S D A Y , O C T O B E R 22 T H 2008
SINGUR - A Wake-up Call
“I am telling my workers — you have to change. If you fail to change, your company may fail."
KGP Singur
Quotes from a pro-reform Left front Chief Minister signaling a change on the horizon for West Bengal.
The 30 year old Marxist
Government finally seemed to
have woken up to the changed
dynamics of a globalized world.
The change was all the more visible
when Mr. Ratan Tata announced
the setting up of a small car factory
at Singur the very day Mr.
Buddhadeb Bhattacharya was
sworn in as Chief Minister on 18th
May, 2006. With a SEZ at
Nandigram also planned, Mr.
Bhattacharya looked set to change
the image of West Bengal into an
investor-friendly one.
Presently, Tata motors has
pulled out of Singur forsaking its
Rs. 1500 Crore investment. The
Government has accepted
In the eyes
of the law
While Singur is a particular
case in point, land acquisition has
n e ve r b e e n e a s y f o r t h e
Government. The Land
Acquisition Act, formulated by the
British way back in 1894 was
adapted in more or less the same
for after Independence and
enables the state to expropriate any
private property forcefully for
'public purpose', with due
monetary compensation to the
owners. The underlying logic lies
in the principles of Utilitarianism
and the consideration of
community welfare over an
individual's right to property.
Unfortunately, the law is
inherently imperialistic and
successive Governments have only
worsened matters by taking full
advantage of the ambiguity of the
'Public Purpose' clause. Whenever
conflicts with the judiciary arose
(See Box, R. L. Aurora vs. State of
U.P, 1962), the Govt. brought about
amendments (1962 and 1984)
which only strengthened its arm.
The term ‘Public Purpose’ was
“The Land Acquisition Act
did not contemplate that the
Government should be made a
general agent for companies to
acquire lands for them for their
private profit”
- Supreme Court
expanded to include “companies
that are engaged in or are planning to
engage in any industry or work for
public purpose''. With this, the state
could virtually classify any
acquisition of land to be in public
interest. Since then, the courts have
been indecisive on the issue, with
one judgement ruling that 'The
Government is the best judge in
deciding whether acquisition is for a
public purpose or not'
FEATURES A V E N U E 3
"We are not fools to ignore the changes taking place in the World".
Nandigram as a failed case of crisis. The Government resorted victims, the most horrific being
forced land acquisition; with a to brute force to quell protests , the rape and killing of an 18 year
dented image not just in the eyes of involving both the state police old girl inside the factory
the industry but also the workers and CPI (M) cadres to coerce premises. The culmination of
and farmers whom it claims to people into accepting the these events was the 'gherao' of
represent. compensation package offered. the factory which forced the
Although forcible acquisition of Tatas to pull the plug. The recent
So what went wrong? land for a ‘public purpose’ is the events are too fresh to be
The proposed 997 acres for state’s legal right under the reiterated here.
the Tata small car plant was Land Acquisition Act (See Land
Acquisition - A Legal Perspective), The SEZ Question
mostly fertile, multi-crop land,
located in one of the most there were two major issues on In an overzealous drive to copy
a g r i c u l t u r a l l y p r o d u c t i ve which the Govt. was caught on China's Special Economic Zones
r e g i o n s o f We s t B e n g a l . the wrong foot. (See Box) (SEZs) model, more than 500 SEZs
Unwilling farmers standing to These let Ms. Mamata have been sanctioned covering
lose their only source of income Banerjee to creep in and the around 500,000 acres in total. This
naturally erupted in protest and communists ironically found has meant widespread acquisition
the state's ill-preparedness was themselves fighting on the side of prime agricultural land for both
clear in the inept handling of the of a capitalist business house. public and private sector
The agitation claimed its enterprises, often with meagre
compensation and no
rehabilitation. Small farmers have
Compensation Package been the worst hit, with the land
The initial compensation package was fixed as follows: going in huge chunks to big
1. Rs. 8.70 Lakhs per Acre for the mono crop land corporate houses, a reversal of the
2. Rs. 12.76 Lakhs per Acre for the multi-crop land. Land Reforms era. Singur and
This Rs. 12.76 Lakhs, if put in a Fixed deposit at the current rate Nandigram were only waiting to
of interest, would earn Rs. 9,750 per month, ignoring inflation, happen.
which comfortably exceeds the income from any multi-crop land. The Government seems to have
The return drops to nearly Rs. 3,000 per month if inflation is woken up to some of these
accounted at the rate of 6%. Such compensation also neglected the concerns, going by the provisions
expected increase in the value of the land post development. Most of the Land Acquisition
of the small farmers are poorly skilled and the absence of a Amendment Bill 2007. 'Public
rehabilitation package meant that unemployment was a very real Purpose' is redefined to include
prospect for most of them. only defense purposes and
Cost of wooing the Tatas infrastructure projects. The
The enormous subsidies and incentives provided by the state Government can now acquire land
Govt. has raised several eyebrows. A Rs. 200 crore loan at 1% rate of for private companies only if 70%
interest, VAT proceedings being handed back to the company as of the required land has already
loan, Rs. 130 crore as compensation to farmers; all add up to a been obtained by the company
straightforward subsidy of Rs. 12 crore a year on the land purchase. through direct negotiation with the
These benefits are required to support the Nano project. But is the land owners. The Rehabilitation
state justified in using tax payer money for offering these enormous and Resettlement Bill 2007 has also
benefits to a private venture?
been simultaneously tabled which
What needs to be done? è Where should the line be drawn
The basic question of SEZs slave labour) and the Shenzhen between public good and private
on prime agricultural land still SEZ (set up on coastal profit?
remains unanswered. The wasteland) are the paths to è Should land acquisition solely be
Standing Committee on follow. the responsibility of corporate
Commerce in its report on The The Government's callous houses or is state intervention
Functioning of Special Economic approach towards basic necessary?
Zones in June 2007 infrastructural development is è Who does the state bear greater
recommended the use of only the major reason for the failure responsibility towards– the farmers
waste barren land for SEZs; to of the SEZ model in India, as who stand to lose their livelihood or
use single-crop, rain-fed land in opposed to its success in China. the private developers?
unavoidable situations and to The people affected too have to provides for better compensation
ban altogether the use of multi- be taken into account. Slogans packages for tribals, forest dwellers
crop, irrigated land. None of like “China was yesterday, India is and land tenants taking into
these have found any mention in today” will only remain the account the intended use, future
the amendment bill, an empty rhetoric that they are value of land and a social impact
oversight that is too glaring to unless the present primeval assessment. Alternative
ignore. Industrialists cannot be outlook changes. The corporate employment and not
blamed for willing their world, by itself needs to follow compensation is the key issue here
factories to be placed at well- the example of visionary as simply handing out a lump sum
connected places with abundant industrialist J R D Tata, who had of money does not serve the
resources. It is the Government's the courage to set up base in a purpose. The old adage about
responsibility to provide the barren land and convert it into teaching a person to fish rather than
necessary infrastructure to the sparkling, well- giving him a fish holds. Companies
make it viable for SEZs to be set administered city of and the Government should
up on wastelands such as the Jamshedpur. India needs more ensure that all displaced people are
Thar Desert. Russia's Siberian of such visionaries. Let's hope given sufficient training to make a
industrialization (without the there are more. living.