Scholar suggests auction-based model to calculate land acquisition compensation

Last Updated: Fri, Nov 09, 2012 13:20 hrs

New models, based on either public auctions or lease principle, have been thrown up as alternatives to compensation models prescribed in the proposed amendments to the Rehabilitation and Resettlement Bill of 2011.

These suggestions came up at a panel discussion on the pending Bill at Observer Research Foundation on Friday chaired by former Cabinet Secretary Surendra Singh, an advisor to ORF.

Describing the current formula of calculating compensation in cases of land acquisitions as arbitrary, Dr. Parikshit Ghosh, faculty of the Delhi School of Economics, suggested that the compensation should be calculated through auction. He said buying the cheapest land through auction would ensure transparency and flexibility.

But the Economics Times National Editor T.K. Arun said the idea of one time compensation, which he described as "one time alienation", was not a good idea. He suggested a lease based model where the land can be acquired through giving away equities to the land owners, making them stake holders in the growth story.

Dr. Ram Singh, another faculty member from the Delhi School of Economics, said real estate aspect should be taken away from the Public Private Partnerships. Giving examples, he pointed out how the PPPs without real estate component have done better and without controversies.

Senior advocate Manoj Kumar said transparency, efficiency and viability should be pillars of the legislation. To achieve this, he suggested Land Bank Corporations which can keep acquiring lands which are surplus or infertile.

RIL's Senior Vice President S.V. Goyal pointed out some loopholes in the Bill while appreciating the government for coming up with this new Bill. He said while they have no problems with the consent clause, but it should be limited to land owners and not affected family. He said there was also no definition of 'rural' and 'urban' which could lead to problems. He said the provision for 20 percent giveback of developed land was also too high.

Muhammad A. Khan, OSD to Union Rural Development Minister Jairam Ramesh, said the suggestions of both lease based model and auction based model were interesting but both too have problems. He said the Standing Committee of Parliament had studied the lease model and decided to shelve the idea though the ministry was interested. Dr. Arun Maira, member of the Planning Commission, also spoke. (ANI)

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