NEW DELHI, (Reuters) – India’s government edged closer to replacing a century-old land acquisition law yesterday, introducing a bill in parliament that seeks to placate a rural voter base worried it is being short-changed in the country’s rush into modernisation.
Delayed for months by anti-corruption protests that paralysed parliament, the bill that would increase compensation for forced and large land sales was squeezed into the lower house ahead of a recess and could be voted on in December.
Compulsory land acquisition for the public good is a contentious issue as crowded India seeks to industrialize, often at the expense of small landholders. The new bill proposes paying four times market value for land earmarked for infrastructure projects in rural areas.
The legislation, spearheaded by ruling Congress party leader Sonia Gandhi and her son Rahul, is seen as crucial for the government’s chances of winning elections in the heartland state of Uttar Pradesh next summer.
The Gandhi family has staked their political future on making big gains there ahead of a general election in 2014, where Rahul Gandhi is seen by many as a potential prime ministerial candidate for the Congress party.
“The entire credit for this bill should go to Rahul Gandhi,” Rural Development Minister Jairam Ramesh told reporters. He said opposition parties broadly supported the reform, which he hoped will be approved in December.
The mainly poor farmers who make up the bulk of India’s 1.2 billion population worry they are being ripped off by rapacious businessmen and politicians in land deals, while companies are wary of making large investments for fear courts will strip them of their holdings.
The government wants to meet the needs of the farmers but must also keep India’s economy growing at a fast rate by attracting investment for new roads, housing and factories.
Major infrastructure projects are currently held up by clashes over land. Tata Motors had to abandon plans in 2008 to build a car factory in West Bengal state due to violent protests by farmers.
‘LAND FOR LAND’
In the poor coastal state of Orissa, protests by farmers have slowed the construction of India’s biggest single foreign direct investment, a $12 billion steel mill belonging to South Korea’s POSCO .