land acquisition and transfers for private industry_211213

8/13/2019 Land Acquisition and Transfers for Private Industry_211213

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C e n t r e f o r E q u i t y S t u d i e s | W o r k i n g P a p e r

A case study in Raigarh, Chhattisgarh

December 13

Land Acquisition and Transfers

for Private Industry


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C e n t r e f o r E q u i t y S t u d i e s | W o r k i n g P a p e r P a g e 2

This study was undertaken by the Centre for Equity Studies in partnership with

Jan Chetna in Raigarh, who continue to work tirelessly for the rights of the

disadvantaged all over the district, often at a great personal cost. Without the

assistance of Rajesh Tripathi, Savita Rath, Ramesh Agrawal, and others in the

organization, this study would not have been possible.

The paper was written by Amod Shah, Saba Sharma, and Shikha Sethia,

researchers at the S. R. Sankaran Unit for Hunger and Social Exclusion. Other

researchers who worked on interviews, surveys and analysis in this study

include Kanchan Gandhi, Radhikha Nair and Shankhmala Sen. We are always

grateful for the guidance and input of Harsh Mander, director at CES.


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affected persons (PAPs), about 40 per cent of who were tribals. 2 Only about a

quarter of all such displaced persons had been rehabilitated.3 An updated

estimate, for the period from 1947 to 2000, puts the total number of DPs and

PAPs at more than 60 million.4 While there are no recent estimates on the

number of development-displaced and project affected persons, the rapid pace ofresource exploration and industrialisation in recent years would suggest a sharp

increase in these numbers.

A second notable feature of recent economic growth in India is the increasing

withdrawal of the States participation in the processes of development and

industrialisation. This is particularly apparent in the case of public purpose

projects, for instance mining projects, dams, power plants, highways, ports and

other vital infrastructure and industries, which serve the broader interests of

society, rather than solely private aims. While in the past, government owned

companies were directly responsible for setting up and running large-scale

projects in the public interest, the State has increasingly found itself unable to

meet the rapidly growing demand in these sectors in the post-liberalization

period. In addition, the belief that the private sector can deliver these public

goods and services faster and more efficiently than the government has come to

be widely accepted. As a result, the government has actively supported the

growing influence of private companies in the implementation of public purpose

projects, with the government functioning primarily as a facilitator of such

private sector participation. For instance, over the period from 2006 to 2010, the

private sectors share of the total installed capacity ofthe power sector in India

rose from 11.6 percent to 20 percent, and private companies are expected to

contribute around 60 percent of the new power capacity added over the 12th

Five Year Plan period, from 2012 to 2017.5 Similarly, 74 out of the 131 coal

blocks allocated by the government between 2006 and 2011 went to private

companies.6

The States changing role in the context of public purpose projects raises critical

questions about its ability to balance its responsibility of protecting the rights of

those affected by the project and compensating affected persons for any costs

that they are forced to bear in the name of development, with the pressing need

2Fernandes, Walter (1998), Development-Induced Displacement in Eastern India, in S.C. Dube

(ed.), Antiquity to Modernity in Tribal India, Vol 1: Continuity and Change among the Tribals,

New Delhi: Inter-India Publications, pp. 217-301.3Ibid4Fernandes, Walter (2007), Singur and the Displacement Scenario, Economic and Political

Weekly, 42 (no. 3, 2026 January), pp. 203-6.5India's installed power capacity up 37% in last five years - Economic Times6Minutes of the meeting held on 11.01.2012 & 12.01.2012 chaired by Additional Secretary (Coal)

to review the progress of allocated coal/lignite blocks and associated end use projects, Ministry

of Coal, Government of India,2 March 2012


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to create a favourable policy framework for rapid growth in sectors that promote

the public good. These issues are of critical importance, since public purpose

projects, despite their broader social and developmental objectives, have severe

negative impacts on the environment and the lives of people affected by such

projects. As the pace of growth and industrialisation has significantlyaccelerated, so too has the scale of such destruction and damage. While the role

of private companies is being increasingly regarded by many as the most

efficient way to achieve faster growth, there is great concern that private

companies are motivated primarily by profit and in the pursuit of profit, the

public benefit is often compromised. The State, by encouraging and actively

assisting private companies implementing public purpose projects for instance,

by appropriating land for their use or relaxing environmental standards for such

projects- is ultimately utilising its sovereign power to further private profit. It is

the States duty, in all such transactions, to ensure that the viability of the project

is also evaluated on the basis of how far the benefits to the public outweigh the

costs to the public, rather than project-level profitability, and the extent to which

both due legal process and justice have been ensured for all persons affected by

the transactions.

The present study seeks to analyse the abovementioned debates specifically in

relation to the procurement of land by private companies implementing public

purpose projects. In the past few years, the highly contentious nature of such

land transfers, often with the active support of the government, has been widely

publicised due to agitations in Singur and Nandigram in West Bengal, and in

Jagatsingpur and Niyamgiri in Orissa, among others. However, these are hardly

isolated incidents; by one estimate, land related conflicts affect 130 of Indias

602 districts, across all states of the country, with most such incidents taking

place in 2011 and 2012.7In this study, we explore in greater detail the various

mechanisms by which such transfers have occurred, as well at the States role in

this process. The rest of the paper is structured as follows: Section 2 summarizes

key laws and procedures related to land procurement by private companies.

Section 3 details the objectives and methodology of the study, while a detailed

analysis of the study findings is presented in Section 4. Lastly, section 5 discusses

these findings in the context of Indias recently passed land acquisition law.

7Press Release: New Research Predicts Rising Trend in Indias Violent Land Conflicts; Map Shows

Massive Resource Takeover Spurs Conflict in 130 Districts, 17 December 2012, Rights and

Resources Initiative, Society for Promotion of Wastelands Development, New Delhi. Available at

http://www.rightsandresources.org/documents/files/doc_5644.pdf


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2. Laws and procedures for land procurement by private companiesPrivate companies undertaking public purpose projects can rely on two avenues

for the procurement of land required for such projects - direct purchase from

landowners or compulsory acquisition by the government. In theory, companies

and landowners are free to engage in free market transactions, resulting in the

purchase of land by the company at a mutually agreed rate of compensation.

However, as we highlight in the findings of our study, there generally exists a

significant asymmetry of power between land (and livelihood) losers and

companies, resulting in deals being concluded on terms that are unfavourable orunjust to land losers.

The process of coal allocation to private companies

As per the Coal Mines (Nationalisation) Act, 1973, only the public sector was

allowed access to the countrys coal reserves. However, soon public

enterprises found themselves unable to cope with the increasing demand for

coal to feed the countrys growing demand for coal for power, steel andcement consumption. In 1993 and 1996, amendments to the Coal Mines

(Nationalisation) Act allowed for coal mining for captive consumption by

private companies for power generation and cement, respectively, with other

uses to be notified by the government. A previous amendment in 1976 had

permitted captive mining by private companies in the iron and steel sector.

The governments record in allocating blocks through a fair and transparent

process has been far from satisfactory and, rather than maintaining a neutral

role in the process, is accused to have been hand in glove with privateindustry. A draft performance audit by the CAG of allocations made by Coal

India Limited reveal that, between 2004 and 2009, the government had

allocated coal mines with a capacity of producing over 14 billion tonnes to

private companies, at preferential rates and without following a transparent

bidding process. While the scale of the allocations in this period is

unprecedented, it is alleged that even allocations done between 1993 and

2004 were rife with malpractices. Allocations in both periods are currently

the subject of an enquiry by the Central Board of Investigation.

While captive mining was encouraged in order to help meet short and

medium term coal production requirements of the country, many of the

captive coal blocks allocated failed to meet production targets and some failed

even to start production.

Source: "Draft Performance Audit, Allocation of Coal Blocks and Augmentation of Coal

Production by Coal India Limited" Report of the Comptroller and Auditor General of India

(Union Government (Commercial)), and various news articles


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Similarly, in an attempt to address its extremely poor record of rehabilitation

and resettlement of persons affected by public purpose projects, the government

introduced a National Policy on Resettlement and Rehabilitation for Projected

Affected Families (NPRR) in 2003, and subsequently revised this in 2007. The

stated aim of the policy is to minimise large scale displacement, and where such

displacement is inevitable, to ensure the proper rehabilitation and resettlement

of all project affected families, including for landless persons whose livelihoods

and are negatively impacted by such projects. Unlike the LAA 1894, which only

dealt with cash compensation for land losers, the NPRR adopts a more holistic

view of rehabilitation and resettlement, laying out guidelines on additional

assistance aimed at the restoration of livelihoods of affected persons, and where

possible, the provision of land for land. The NPRR attempts to lay down basic

norms for the rehabilitation and resettlement policies adopted by various States

and Central government departments. For instance, the Chhattisgarh Ideal

Rehabilitation Policy 2007 lays out guidelines for amount of land to be provided

to resettled families, the provision of jobs and other assistance. It also specifies

norms around compensation for acquired land, and for trees, houses and other

improvements on the acquired land. One major concern with the NPRR is that it

applies only to projects that displace 500 families or more en masse in the plains

and 250 families or en masse in hilly, desert or Scheduled Areas. This has

resulted in instances where land acquisition for the same project has been split

into smaller bits, each displacing fewer than 500 families, so that the provisions

of this policy can be sidestepped.11In order to give the NPRR statutory backing,

many of its provisions have been incorporated into the RFCTLARR 2013, which

11Walter Fernandes, Rehabilitation Policy for the Displaced, Economic and Political Weekly, Vol

XXXIX No 12, 20 March 2004

How is land acquisition legislation misused to favour private companies?

A recent CAG report on land acquisition by the Odisha government for private

companies between 2002 and 2011 highlights that in 176 out of 208 cases

(involving 3,434 hectares of private land), land was acquired based on their

incorrect declaration as public purpose projects. Additionally, in 85 of thesecases (involving 2,010 hectares of private land), the urgency clause was

invoked to speed up the land acquisition process, even though none of these

cases satisfied the conditions required for invoking this provision. The CAG

report also found that the government had failed to adequately assess land

requirements for industries, resulting in large amounts of acquired land being

unutilised and hoarded by private companies.

Source: T N Vijaylakshmi (2012), CAG blows lid off land grab in Odisha, Down to Earth, 30

March 2012


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now stands as a comprehensive law regulating land acquisition, as well as

rehabilitation and resettlement.

In tribal areas covered under Schedule V of the Indian constitution 12, the

Panchayats (Extension to the Scheduled Areas) (PESA) Act 1996 provides foradditional safeguards to prevent tribal land alienation and unfair acquisition of

tribal land. These include a requirement that land acquisition for development

projects, and rehabilitation and resettlement of affected persons, be undertaken

only after consultation with the Gram Sabha or the Panchayats at the appropriate

level. As of March 2013, only three out of the nine states with Schedule V areas

had framed state-level rules for implementation of the PESA Act. Whereas

Chhattisgarh is yet to frame state-level PESA rules, the states Land Revenue

Code and Land Acquisition Act have been amended to require approval of

village-level Gram Sabhas in the event of land acquisition or diversion of land for

industrial purposes. By requiring consent at the village level, rather than just

consultation at the appropriate level, the Chattisgarh amendments appear to

provide for stronger protection against unfair land acquisition than the PESA Act.

3. Overview of the studya. Study Objectives

This study aims to provide a detailed examination of the processes by which land

is procured by private companies undertaking public purpose projects, as well as

the role of the State in these transfers. It looks at both legal and illegal

mechanisms of land transfers, while acknowledging that even transactions that

appear to be legitimate on paper may not be truly legal; and also there is a

distinction between formal and substantive legality, and between legality and

justice. Similarly, rules and regulations governing the transfer of land are often

subjectively interpreted and implemented by the State and its officials, resulting

in transactions that, though legal, may be severely unjust to certain stakeholders.

With these objectives in mind, the study essentially aims to ask the following key

questions:

1. In the studied area, what is the extent to which companies purchasingland directly from local residents follow procedures laid down by law, in

both letter and spirit? If the law is subverted, how is this done? Is

illegality merely an anomaly, or part of the system in the way that it is

operationalised at the ground level?

2. What, ultimately, is the role of the state when it comes to issues ofprocurement of land by private companies? Is it merely a facilitator, and

to what extent should it take responsibility for ensuring fair practices?

12Raigarh district in Chhattisgarh, where this study is focused, is a Schedule V area


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C e n t r e f o r E q u i t y S t u d i e s | W o r k i n g P a p e r P a g e 1 0

How does the States role in this instance fit into the broader debate about

the nature of development, and the role of industrialization?

3. In the context of compulsory land acquisition by the government, to whatextent are practices laid down in the new land acquisition law just or

unjust? How does it address the issues highlighted in the study area?

b. Description of the study areaThe study focuses on Tamnar block in the district of Raigarh, Chhattisgarh.

Raigarh has experienced rapid industrialisation since the early 1990s, when the

first sponge iron plant of the steel and mining giant, Jindal Steel and Power

Limited, was established there. Since then, the entire state of Chhattisgarh has

seen industry grow at an unprecedented rate, and Raigarh, given its dense

concentration of coal, perhaps more so than other districts. Tamnar block in

Raigarh is host to a variety of industrial projects, including coal mines, thermal

power plants, sponge iron plants, cement plants and a large industrial park. A

number of private companies currently run projects here, with the major ones

being Jindal Steel and Power Limited, Jindal Power Limited, Monnet Ispat and

Energy Limited, and Jayswal Neco Industries Limited.

The environmental impact on such industrialisation has been enormous,

resulting in massive deforestation, water and air pollution, and the consequent

impact on the health of those who inhabit these places. But by far the greatest

conflict is on the issue of land, and the way that land is sold and acquired in these

places. Of the 533 Gram Panchayats in Raigarh, about 300 are likely to be

affected by mining and industrial projects. In Tamnar block, only 6 out of 57

Gram Panchayats have not experienced land acquisition for coal mines or other

industries. In about 8 of the affected villages, all of the land has been transferred

for such projects, resulting in the displacement of the local population. Since the

process of land procurement is far from over, such displacement is bound to

increase.13

c. Study methodologyThe study involved visits to the study area by CES researchers, in June and

October 2012, and a household survey in three villages, conducted over a two-

week period in February 2013. In two of the surveyed villages, Sarasmal and

Kosampalli, large amounts of land have been procured for the Gare-Pelma IV/2

and IV/3 opencast coal mines, owned by Jindal Power Limited. The third village,

Tamnar, is the largest village in Tamnar block and lies in the vicinity of a 1000

MW power plant, also built by Jindal Power Limited. In Tamnar village, the 1000

MW power plant was set up in 2004, and is used for commercial power

production. The plant is now further expanding to add the capacity of another

13Interview with Jayant Paridhar, reporter at the Raigarh daily Patrika


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2400 MW, which has run into some controversy previously, first for starting

construction before obtaining environmental clearances from the Ministry of

Environment and Forests, and then for proposing construction on land that had

already been acquired by the Chhattisgarh Mineral Development Corporation.

The small size of Sarasmal and Kosampalli14 enabled a fairly comprehensive

door-to-door survey by our team of four researchers, covering a total of 83

households. In Tamnar, a large village of 3,974 people organized into 10

neighbourhoods or paras based on community, we aimed to cover each

neighbourhood and randomly select houses within a given neighbourhood,

sueveying a total of 117 households.

The survey covered questions about the amount of land purchased, acquired or

illegally occupied by the company, the manner in which such transactions were

conducted, the current landholding status of the household, and the

compensation received (both monetary and non-monetary). In addition, the

survey enquired about the perceived health and environmental impacts of the

project, welfare work undertaken by the company under its corporate social

responsibility programs, and awareness of procedures related to land

acquisition.

The survey results are supplemented by interviews with individuals and families

in several villages across Tamnar block, conducted during earlier visits, and

alongside the survey in February 2013. All of these villages are located in the

immediate proximity of coal mines and other industries. Information from these

interviews has been used to illustrate and elaborate on some of the mechanisms

of land procurement highlighted in the survey data, as well as crucial issues

around health, environment, and livelihood, which form an imperative part of

the larger narrative of land acquisition. The report also refers to documents

obtained through the Right to Information Act and from government offices in

Raigarh.

4. Findings of the studyWidely perceived through the analysis of the survey, as well as through

interviews and meetings in affected villages, was a sense of mistrust in the

companys willingness to behave fairly, and in the governments promise to

protect against these injustices. In both private sales and land acquisition, there

were a variety of mechanisms where the process of law had been subverted to

varying degrees. In some cases, even where formal legal procedure was followed,

in practice, it was not done so substantively with adherence to the spirit in which

14In 2011, the population of Sarasmal and Kosampalli villages was 508 and 279 respectively


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the law was framed. During private sales, for instance, the power imbalance

between the company and the landholder puts the landholder at a considerable

disadvantage, often resulting in transactions that barely compensate for the

market value of the land, let alone the loss of livelihood. Companies are able to

do this by intimidating through force and, and, as we heard repeatedly,threatening people with forced acquisition at even lower levels of compensation.

Companies are successful in purchasing the land in this manner because it is

widely assumed that regardless of whether it is through private sale or

compulsory acquisition, they will eventually be in possession of the land. And

finally, even when the law is formally or even substantively complied with, it

often leads to unjust outcomes for vulnerable communities like tribal people, and

raises questions of sustainability.

Landholders felt that the government was willing to use its authority to act in the

interests of the company. In cases where they resisted selling their land to the

company, it was compulsorily acquired by the government. While the affected

persons should be better protected when the government acquires the land

parcels, this was not the case. The government appeared to have completely

disregarded its duty to adequately protect the interests of landholders. For

instance, appeals filed against land acquisition were not taken into consideration

by the local authorities. Notifying Gram Sabhas as well as individuals of the

impending acquisition and the process of appeal is an important duty of the

government but we discovered that rarely were the affected persons fully

informed about the procedures and most people were unaware of the time-

frame within which to file an appeal. Similarly, instances of land acquisition in

scheduled areas like Raigarh district require a No Objection Certificate (NOC)

from the Gram Sabha, but false NOCs were issued, signed only by gram

panchayat members, and accepted by the state as an adequate proof of consent.

Perhaps most crucially, none of these procedural violations take into account the

larger question, of whether the government should be indiscriminately acquiring

tribal land for industrial purposes in the first place. It can be argued that the

spirit of the law barring the sale of tribal land to non-tribals should override the

governments right to indiscriminately exercise its powers of eminent domain,

and should particularly apply to instances where the State functions as an

intermediary in the process of such land transfers.

Direct negotiation between the company and the affected person (whether

coercive or not) and acquisition by the government on behalf of private

companies are not the only two ways through which companies acquire land for

development projects. As evidenced in Raigarh, another practice is the illegal

occupation of land by companies. As before, at a disadvantage because of their

lack of agency, affected persons are often unable to regain possession of theirland. In most instances, directives from the district collectors office, as well as


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orders from the high court to return the land to the owner were ignored by the

company, and neither had government officials followed up on the

implementation of these orders, despite the repeated requests of the

landholders. There is also no official record of land being illegally occupied by

the company, i.e. cases where it may still be in the name of the originallandholder, but is effectively being used by the company.

In tribal areas, where sale of tribal land to non-tribals is illegal, companies have

developed the practice of purchasing the land parcel in the name of a tribal

employee, for their own use. Even though this is formally recognised as a legal

transaction between two tribals, it represent a clearly illegal subversion of laws

aimed at preventing alienation of tribal land. This was a recurring practice in

Raigarh, and many tribal landowners claim to have sold their land, either directly

to the company or to an employee or broker of the company, and these sales had

either been registered with full knowledge of the local authorities, or transferred

without due procedure. It is practically impossible to determine how much tribal

land has been procured by the company in this fashion, without the intervention

of the government. and particularly local officials like the patwari, who is

supposed to keep an annual record of changes in land use at the village level.

However, it is widely acknowledged that these records are not regularly

updated, if at all.

In many cases, people were unable to clearly differentiate between the two main

forms of land procurement, namely private sale to the company and compulsory

land acquisition by the government. While this may appear to be a

methodological issue, it actually speaks of a much deeper problem. It is reflective

of a larger trend in which affected persons are unable to tell the company and

the State apart, given that the latter tends to act almost uniformly in favour of the

former. This lack of information is not just a symptom of poor awareness among

the landholders but of willful neglect of the due process of acquisition on the part

of companies and the State alike. A number of people reported that the

compensation for both land acquisition and private sale was received as one

lump sum, and were therefore unable to tell whether the rates of compensation

for these transactions were different for the two. Moreover, some of the

landholders covered in the survey were unable to specify whether their land had

been transferred to the company through a private sale, or land acquisition, or a

combination of both.

Irrespective of the nature of the transaction - whether through direct sale,

compulsory acquisition, or illegal occupation - ignorance about proper

procedures was a key reason for affected persons going undercompensated or

being unable to effectively appeal at the appropriate level. Adding to this was thecommonly shared perception that the government had accepted a bribe from the


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company and will thus act in its favour, which left landholders with little choice

but to take what was offered quietly, without protesting. The absence of the State

in checking the subversion of laws and procedures by the company was not

restricted to just private land transfers, but extended to other issues, such as the

illegal occupation of forest and common land by the company and a completedisregard for a projects impact on the health, environment, livelihoods and

social conditions of the local population.

The findings of the study are divided into five sections the first is an enquiry

into the procedure of land transfer, in which we identify how much land was

procured through various mechanisms, and how many people were rendered

landless as a result. The second area of enquiry is compensation and

rehabilitation, in which we examine the differing rates of compensation and also

issues such as the provision of jobs and other rehabilitation measures, which are

meant to compensate for the loss of livelihoods and security. The third section is

about awareness and consent, where we assess how well informed people were

about the process of land acquisition and sale, and whether companies and

governments are following the correct procedures when land is acquired or sold.

More than anything, this section aims to highlight the importance of information

and awareness of law in the land acquisition process.15 We then address the

effect of the development project on livelihoods, on health and environment as

well as the social impact. Finally, we look at what CSR initiatives have been

undertaken by the company in the vicinity of the project.

i. ProcedureBased on the survey, of a total of 682.07 acres of land that is in possession of the

company in Sarasmal and Kosampalli, 47 percent was sold to the company

directly, 38 percent was procured through government acquisition and about 1

percent was illegally occupied by the company, without the consent of the

landholder and in most cases, without paying them any compensation. In

Tamnar, of a total of 390.43 acres in the companys possession, 61 percent of the

land was sold directly to the company, 29 percent was acquired by the

government, while another 7 percent was illegally occupied by the company. In

Sarasmal and Kosampalli, owners of the remaining 14 per cent of land (the

majority of which belonged to tribals) were unable to clearly identify whether

their land was acquired by the government or sold directly to the company. In

Tamnar this figure was 2 percent acres, somewhat lower. In some cases we were

15A methodological clarification many households in Sarasmal and Kosampalli, while being

distinct in themselves, have joint land holdings such as between two or three brothers, or

between a father and his sons. When we speak of households in the survey, we speak of the

family representing the same land holding, even where this concerns two or three families.

Where, however, the family members have already split the titles among themselves, we speak of

them separately. This is to avoid repeating entries in the data.


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able to resolve the confusion by looking at acquisition or registration documents,

but in others this proved to be not possible. We have excluded these respondents

from the following data analysis, so as not to misrepresent the results.

Since Tamnar block in Raigharh district has a significant tribal population, and

transfer of tribal land is a particularly contentious issue, it is important to

highlight here that of all the households surveyed in Sarasmal and Kosampalli,

68 percent of land belonged to tribals. In Tamnar, which has a much more

diverse population, 20 percent of surveyed land belonged to tribals, 36 percentto OBCs, and 44 percent to the General category. A breakdown for the groups is

shown in the following table, as are the types of transactions through which the

land transfer took place.

Table 4.1 Details of surveyed households

Sarasmal & Kosampalli Tamnar

NumberLand

(in acres)

Land (%

of total)Number

Land

(in acres)

Land (%

of total)

Landholdinghouseholds

75 682 100% 111 390 100%

of which SC 1 4 1% 1 1 0%

ST 59 467 68% 26 77 20%

OBC 14 202 30% 58 142 36%

General 1 9 1% 26 170 44%

Landless

households8 - - 6 - -

While the transfer of land occurred through private sale, government acquisition

or illegal occupation, even within these categories there is a spectrum, withvarying degrees of compliance with due process.

47%

38%

1%

14%

61%

29%

7%2%

Land sold directly

to the company

Land acquired by

the government

on behalf of the

company

Land illegally

occupied by the

company

Nature of land

transaction

unclear

Chart 4.1 Breakdown of land in possession of thecompany (percentage of total)

Sarasmal & Kosampalli

Tamnar


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In some instances, transactions were conducted willingly between companies

and landowners, with minimum infringement of the law, at least on paper. In the

surveyed villages of Sarasmal and Kosampalli, sale of non-tribal land conducted

willingly accounted for 15 percent of the total land sold, acquired or illegally

occupied by the company, and in Tamnar, it accounted for 34 percent. However,

even here, there are discrepancies between the compensation received. In all of

the surveyed villages, companies typically first approach the biggest landholders

in a village with offers to buy their land. They often also went on to become

intimidators and agents of the company in helping the company to purchase land

from other residents of the village. These landholders tended to be upper-caste

and wealthy and, given their status as keys to purchasing land in the rest of thevillage, were able to negotiate better prices and compensation deals for

themselves.

With tribal land, even less can willing sales be accepted at face value. Provisions

aimed at preventing tribal land alienation in Schedule V areas of the country

prohibit the direct sale of tribal land to non-tribals or companies. However, a

fairly common practice revealed during our surveys involved selling land to

tribal employees at the company, or a tribal broker, thus making the actual sale

legal (since it is still a transaction between two tribals). The use of this land bythe company, nonetheless, remains illegal, and obtaining this land via its

employees is a clear violation of these rules. This is rarely ever investigated,

since tribal employees and brokers do not file complaints against the company,

and there is no other way to say how the land is being used. Of the total land

sold, acquired or illegally occupied by the company, 14 percent in Sarasmal and

Kosampalli, and 9 percent in Tamnar was tribal land that was reportedly sold

willingly to the company.

15%

44%

10%14% 16%

2%

34%30%

17%

9%

2%7%

Non-tribal

land sold

freely to the

company

Land acquired

by the

government

Non-tribal

land sold

through

intimidation

Tribal land

sold freely to

the company

Tribal land

sold through

intimidation

Land illegally

occupied by

the company

Chart 4.2 Nature of land transactions (percentage of total)

Sarasmal & Kosampalli

Tamnar


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In Sarasmal and Kosampalli, we found that 26 percent of the total land sold,

acquired or illegally occupied by the company involved such forms of

intimidation, and in Tamnar this was 19 percent of the total land. Whereas in

Sarasmal and Kosampalli, the primary form of intimidation was threats by the

company and its agents, in Tamnar, most households who were intimidatedreported that their land was dug up, earth and building materials were dumped

on it, or that access to their fields was severely restricted due to the companys

activities. Many who claimed not to have been intimidated nonetheless wished

they had not sold their land, and worried about future livelihood security, or of

feeling cheated because of inadequate compensation.

Often when companies are unable to acquire land themselves from villagers or

are not allowed to purchase land directly from tribals, they approach the block

or district administration with a request for the acquisition of the required land.

Land acquisition of tribal and non-tribal land through the government usually

happens over several rounds, depending on the requirements of the company at

various stages of the project. In Sarasmal and Kosampalli, 44 percent of the total

land transferred to the company was acquired through the government, and in

Tamnar this figure accounted for 30 percent of total land. While acquisition is

considered to be the states prerogative,16 people report that they feel the

acquisition was unjustified, or that their consent was not properly sought before

the process began. Many came to know of their lands being acquired very late

into the process, and there is some evidence that the government did not make

enough of an effort in informing people well in advance, as they are required to.

There are also cases of illegal occupation of private land by the company, where

little or no compensation is paid. In a few cases, landholders were forced to sell

after companies had already occupied the land and begun work on it. As land

ownership had been transferred to the company, this appears legal on paper,

although our interviews suggested otherwise. Such illegal occupation of land by

the company accounts for 2 percent of all land procured by the company in

Sarasmal and Kosampalli, and 7 percent in Tamnar.

16This is no longer the case, since the recently passed land acquisition act requires a minimum

level of consent if land is being acquired for private companies


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Occupation of forestland and government land

In addition to private land, companies also utilize common lands and forests in

and around villages, sometimes illegally. In Sarasmal and Kosampali, discussions

revealed that the company had occupied at least 13.5 hectares (33.7 acres) of

village common land, without approval from the Gram Sabha, and mining has

continued on this land despite Gram Sabha resolutions calling for it to be ceased.

In the case of forestland, documents obtained through the RTI indicate that nodiversion of forestland for mining and industrial purposes had occurred in

Sarasmal and Kosampalli. This is at odds with information obtained through the

survey, during which villagers reported that forestland surrounding the village

was also being used by the company. Additionally, at least 10 villagers who were

given title or pattas to forestland under the Forest Rights Act 2006 have had

their land forcibly occupied, without any compensation, by the company. In some

of these cases, the company claimed that this land had been allocated to them by

the government.

Illegal occupation of land

Krishna Sao, a resident of Tamnar, found that 2 acres of land had been illegally

occupied by JPL in 2002, and digging began on it without his consent. He was

offered 2 lakh rupees per acre (at the time, legal transactions were usually

settled at 50,000 rupees per acre), but he refused, and took his case first to theSub District Magistrate (SDM) court, and then to the High Court in Bilaspur. In

2006 the court ordered that his land be returned, but he was unable to get this

order implemented. In 2007, he approached JPL to provide him compensation

for the crops that he lost, which was refused. In addition to facing harassment

by the company when he filed a case, he was also harassed and pressured at

his workplace, forcing him to resign the police service. Krishna Sao is an

exception, and most others, even if they do file a case, do not pursue it after

they are intimidated, either by the company or others in the village.

In the case of Haripriya Bai Patel, 6 acres of her land was illegally occupied by

Jindal Power Limited, and without any money or documents changing hands,

construction of a residential complex for its employees began on the land.

Haripriya Bai went to the district collector with this complaint, who ordered

that the land be immediately returned to her, in its original form. When this

did not happen, she took her case to the high court in Bilaspur, who ordered

the same thing, most recently in November 2013, when it gave the company

15 days in which to return the land. As with Krishna Sao, however, this order

has not been implemented, and cannot be done without the proactiveinvolvement of the district administration, in particular the collector.


20/35


21/35


acquisition typically happens after the company has bought up whatever land it

can beforehand, this is of little use. In any case, the government has set the bar

too low to adequately account for the loss of livelihoods associated with land;

until very recently, when compensation amounts were raised substantially,

persons losing land due to government acquisition were paid less than Rs. 1 lakhper acre.

In addition to setting the rates in a discriminatory fashion, companies will

sometimes refuse to pay or delay payment as punishment for filing a case against

them or resisting the acquisition and sale. Even the government is not entirely

neutral in this process. In a letter from the residents of villages Sarasmal,

Kosampalli, Kondkel, Dongamahua and Libra (all in the Gram Panchayat of

Sarasmal) to the District Collector, the residents allege that 17 landholders from

these villages (all of which have been affected by the JPL IV/2 and IV/3 coal

mines) have not received any compensation for their lands, which were all

transferred through government acquisition.18 The letter further lists each

applicants name, land holding, and whether they have cases pending in a district

or high court on the matter. Out of 17, only two have cases in the high court,

while one is in the SDMs court. There are also those among the surveyed

households who have not collected compensation for land acquisition in protest,

opposing either the acquisition itself, or the extremely low values of

compensation.

As part of the rehabilitation process, the company is obliged to offer at least one

job to each family whose land is acquired for industrial or mining-related

projects. In Sarasmal and Kosampalli, 63 percent of the landowning households

were offered a job by the company19but strikingly, only 25 percent of the total

landowning families have received jobs for a family member. Tamnar does not

fare much better, although the gap is slightly narrower 55 percent of

landowning households were offered jobs, and 32 percent received them. The

outcome is similar, with less than a third of landowning families actually

receiving jobs as part of compensation. People also complained that the jobs

offered were mostly for low-paying contractual work, which usually paid

between 4,000 rupees to 5,000 rupees per month. These jobs provide neither

sustainability nor significant compensation for loss of livelihood.

Several of those who received jobs, and others who wanted to but did not,

reported that it often takes several trips and repeated requests to the company

before even a contractual job is provided, let alone a permanent one. Others

18A copy of the letter is available at the Sarasmal Gram Panchayat. It is undated.19This includes both cases of land acquisition, and instances where jobs were promised to

landholders, as an incentive to sell their land to the company.


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claimed that jobs were promised to each shareholder of a commonpatta (such as

family-owned land, where three or four brothers jointly hold the title of the

land), but ultimately provided only to one shareholder. Some respondents also

reported that during the sale or acquisition, the company offered to sponsor the

education of the children of the landholders, a promise that they have failed tofulfill across the board.

iii. Awareness and ConsentOne of the most remarkable and, we believe, important findings of the study is

the awareness of procedures related to sale and acquisition of land. Many people

were unaware of the requirements from the government and company, and

others pointed out that both had deliberately flouted these procedures.

During instances of land acquisition, the government is obliged to provide a

public notification of the acquisition, with the option for affected landholders to

appeal against the decision within 30 days. In Sarasmal and Kosampalli, we

found that only 12 percent of total landholders whose land was acquired were

informed about it well in time, either through newspapers or through a

notification at the Panchayat office. Another 46 percent found out after the

notification period, but before the process of land acquisition had been

completed.

Similarly, in Tamnar, only 22 percent claim to have been informed in time about

the land acquisition process, and 46 percent found out after the notification

period. Results also show that 19 percent in Sarasmal and Kosampalli, and 22

percent in Tamnar found out about the acquisition not only after the stipulated

period, but indeed after work had already begun on the land. In several cases,

people reported that the first they heard of the acquisition was when they were

asked to pick up their cheques at the Sub-District Magistrates office.

12%

46%

19%24%22%

46%

22%

10%

Before the end of

the notification

period

After notification

period but before

completion

After procedure

was completed

No response

Chart 4.3 Notification about compulsory land

acquisition by government



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The low levels of awareness about notification and appeal explain why despite a

lot of opposition, only 3 households in Sarasmal and Kosampalli, and in Tamnar,

whose land was acquired by the government reported filing an official appeal

against this land acquisition with the relevant authorities. Many reported being

unaware that appeal was possible, while others were reluctant because ofintimidation by company agents or after seeing the fruitlessness of others

efforts. All those that have appealed have reported a lack of response and no

positive outcomes for their case.

Perhaps the biggest fraud perpetuated by companies has been in obtaining false

No Objection Certificates (NOCs). Under the provisions of the PESA Act, land

acquisition in Schedule V areas is only possible with the consent of the Gram

Sabha,20 but in Sarasmal and Kosampalli, as well as Tamnar, NOCs have been

taken from the Gram Panchayatinstead(who are sometimes beneficiaries of the

ensuing process, one dissenting gram panchayat member in Tamnar informed

us), which is illegal.21 In Sarasmal and Kosampalli, only 31 percent of the

respondents were aware that NOC procedures had not been followed or that afalse NOC had been issued, while another 59 percent said that they were

unaware about NOC procedures, or did not attend the Gram Sabha regularly and

were thus not aware. In Tamnar, these numbers were 46 percent and 34 percent

20As discussed earlier, private land sales from tribals to non-tribals are illegal in all instances,

irrespective of the consent of the Gram SabhaG21Residents of Sarasmal filed an objection stating that on the date on which the false NOC is

issued, there was no meeting of the Gram Sabha in the village. As a result, there are now two

official documents, one that claims to have granted the NOC, and another which declares that

there was no such meeting on this date, the latter filed in response to the former. See also

Debarshi Dasgupta, Where the Ore Sinks the Earth, Outlook, 24 September 2012.

Misinformation and Land Transfers

It is not uncommon to hear of people discovering after the fact that their land

had either been sold or acquired without their knowledge. In what might

sound like the plot of an especially absurd film, Bharat Raj Sidar, from Milu

Para, found that not only was his 1.8 Hectares of land sold without his

knowledge and consent to a person whom he had never met nor seen, but

also that it had been sold on his behalf by a woman impersonating his wife.

The situation took another bizarre twist when upon filing a case in the high

court, the revenue department claimed to have lost all documentation

pertaining to his case. This case, filed in 2001, continues to be fought in the

high court, and in the last 12 years Bharat has received several lucrative

offers from Monet Ispat Limited (the company in question) in exchange for

dropping the case, all of which he has refused. The former General Manager of

the company has already been jailed for forging the signature of the buyer.


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respectively. In both cases, only 1 percent thought that the procedures had been

carried out legally. In at least four other villages22 in Tamnar block, false NOCs

had been taken from Gram Panchayats for projects being implemented in their

vicinity. Despite this, there has been no attempt by the local authorities to

investigate the issue and take appropriate action.

iv. Impact of the projectImpact on Livelihood Security

The question of livelihoods is a crucial one in the debate on land acquisition.

Most of the respondents were concerned that without land, their traditional

occupation of agriculture and related activities like livestock rearing andcollection of forest produce were under threat. Thus, an important learning from

the survey has been the proportion of people that have been rendered

completely landless by the acquisition, and how many remain with land on

which to farm. 64 percent of the total landholding households surveyed in

Sarasmal and Kosampalli, and 44 percent of those in Tamnar had become

completely landless as a direct result of the project i.e. all of their existing land

holdings were bought by the company and its intermediaries, or compulsorily

acquired by the government.23A few of these people have bought land elsewhere

with the compensation money received. 9 percent of landholding households inSarasmal and Kosampalli, and 15 percent of those in Tamnar had less than 2

acres of land remaining, meaning they are engaged in some form of subsistence

farming. Food security was a particularly important concern, with most people

having previously grown and consumed their own food, and sold the surplus for

additional expenditures. As a result of becoming landless, people were

concerned that their expenditures would increase because of having to now buy

food from the market, or from the Public Distribution System, and that this was

22Gare, Kharsiya, Saraitola and Jhikabahal23This is separate from the number of people that were already landless at the beginning of the

survey

59%

31%

1%

8%

34%

46%

1%

19%

Unaware/do not

attend Gram

Sabha

No NOC/false NOC

issued

Legal NOC

issued/procedures

were followed

No response

Chart 4.4 Knowledge about Gram Sabha NOC



25/35


not properly offset in the rehabilitation and compensation offered to them by the

company.

Eight of the respondents that were surveyed in Sarasmal and Kosampalli, and 6

respondents in Tamnar, were initially landless, and thus not eligible for anycompensation or rehabilitation. However, the presence of the mines has

negatively impacted their livelihoods, as they worked as agricultural labourers

on other peoples lands. Additionally, any earnings that they made from common

lands or minor forest product are also compromised. However, this section of

affected people has not been addressed by the company or the government, and

they continue to struggle to make ends meet without any external help.

Impact on Health and Environment

In general, regulations on environment are clearer than those on land

acquisition, with clear guidelines in place for each step. The company must apply

for an environmental clearance from the Ministry of Environment and Forests

(MoEF) at the central level, as well as seek approval from the State Pollution

Control Board at the state level, after which it is obliged to submit an

Environmental Impact Assessment (EIA) report from an independent agency.

The submission of the EIAs must be followed by a public hearing or jan sunvahi,

to be announced in at least 2 local newspapers, and must include all affected

persons within a 10 kms radius. After the jan sunvahi, the company is expected

to submit a report of its compliance with various local environmental issues, and

once the MoEF has satisfactorily reviewed thejan sunvahiproceedings and other

submissions, the company is granted a clearance.

Local activists in Raigarh have argued that companies writing the EIAs are not as

independent as they may appear, and are paid by companies to write favourable

reports. A second complaint, by activists and villagers alike, is that these 400-

64%

9%

27%

44%

15%

41%

Landless Subsistence farming (


26/35


page reports, as well as their 20-page executive summaries are almost always in

English, and are hardly ever circulated widely, thus making affected persons

unable to comment effectively on their contents. While the jan sunvahi is

supposed to be about environmental issues, it often becomes a forum for

discussion about social and land-related impacts as well, since there is no otherplatform to voice these concerns publicly. Reports of misconduct atjan sunvahis

are not common, and one in Gare in 2008, a hearing of the IV/6 coal mine

allocated to Jindal Steel and Power Limited, was lathi-charged.24 Activists also

report thatjan sunvahis are usually held in remote and difficult to access villages,

in order to limit local participation, and that company supporters from other

areas are brought in to speak on behalf of the company.

Despite such violations, the flouting of environmental norms is increasingly

being more carefully monitored. The National Green Tribunal (NGT), for

instance, invalidated the January 2008 public hearing at Gare, and directed the

company to hold another. On other issues relating to the expansion of the

2400MW plant, the NGT had also ordered expansion to be stopped until

environmental clearances are properly obtained. It is easier to successfully

appeal the stay or reversal of an industrial project on environmental grounds,

particularly with the establishment of independent agencies like the NGT at the

centre, than it is on grounds of unfairness in the land acquisition process.

However, closer monitoring of environmental standards has nonetheless not

eased the negative effects on the environment at the village level. In essence,

once the applications are cleared and work has begun, there is no follow-up or

monitoring of the extent to which environmental standards with regards to

pollution and health impacts are being met.

In Sarasmal and Kosampalli, which are both now situated on the edge of the JPL

coal mine, the primary source of concern is coal dust, which settles on everything

in and around the village from trees, crops, clothes, etc. Coal dust, dirty water

and other waste from the mines seeps into the nearby rivers and ponds, making

this water unfit to drink. Some people also reported getting skin infections from

bathing or washing their clothes in the water. The presence of the coal mine also

means a significant increase in the air pollution, and noise pollution. Twice a day,

there are blasts to dig deeper for coal, and this results in violent shaking. In some

instances, rocks and debris from the mines fly out due to the blast, and land on

the roofs and houses of the inhabitants, often causing serious damage to the

structures. In addition, the vast amount of deforestation has meant a significant

24An alternative jan sunvahi was conducted in September 2013. See Alok Gupta, 'Public Hearing

for Jindal coal projects held amid protests', Down to Earth, 27 September 2013. Available at

http://www.downtoearth.org.in/content/public-hearing-jindal-coal-project-raigarh-held-amid-

protests


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reduction in access to forest produce, and the takeover of common land by the

company has meant reduced availability of fodder for livestock.

In Tamnar, living right next to the power plant means constant exposure to

smoke from the plant, as well as increased air pollution due to this and thepresence of coal dust in the air. Villagers reported a noticeable increase in

respiratory diseases, and sickness among children. Pollution is affecting the

health not only of humans, but also livestock. As with Sarasmal and Kosampalli,

water pollution is a major issue, particularly with regard to industrial effluents.

Water is unfit for drinking or bathing in, and locals say the availability of fish in

the water bodies is decreasing.

Social Impacts

In addition to affecting the physical environment, the presence of the company

also has adverse effects on the socio-cultural life of the community. In all three

villages, the presence of industry meant that many labourers were brought in

from outside. This created a sense of resentment among the residents, which

often manifested itself in claims about those outsiders making the area more

unsafe for women, or being the cause of increased instances of crime. Others

pointed out that there was increase in the number of road accidents because of

the number of dumper trucks carrying coal to the plant, reportedly driving at

reckless speeds.

The biggest change for the affected families was the changing nature of

livelihood, and of learning to cope with a new way of life that did not have

agriculture at its core. Many families were accustomed to producing their own

grains, fruits and vegetables. Others felt that the company was not compensating

adequately for the loss of livelihood. The effect on employment overall however

was ambiguous, many felt that the company had generated more employment by

being established there in particular, people of lower castes in Tamnar village

felt their social standing had improved, and their being landless no longer meant

that they were at the mercy of the upper caste landowners of the village. Others

also felt that the level of education had improved, more people were sending

their children to private school than before. Even some of those who were not

properly compensated said that if they had been, perhaps life would have

improved, as it appeared to have for those who had been properly compensated.

However, most felt that losing land meant losing their livelihood, which had not

been replaced with a steady source of income from the company. It was pointed

out that those who received the most generous compensation packages were

those that were already powerful in the village the large landowners, who

ultimately became facilitators for the company.


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v. Corporate Social ResponsibilityUnder Corporate Social Responsibility, companies are expected to provide

certain services and undertake work to fulfill the developmental needs of the

villages. In the case of Tamnar, this includes the building of boundary walls for

schools, building water tanks, public taps and digging bore wells to providedrinking water, building roads, setting up community halls, and sometimes

putting up a medical camp and providing free medicines. Additionally, some

people also reported individually receiving financial assistance, or donations for

festivals. Many people responded to questions about CSR with an irritable what

have they done here, even where the company had undertaken CSR efforts in the

village. CSR mainly is a fraction of R&R responsibilities, but done as a kind of

charity, rather than the right of affected persons. The general sense, with few

exceptions, was that digging wells or putting taps in place was not adequate for

the loss of land and livelihood that most people have had to suffer. Most people

said they would have preferred getting a permanent job with the company

instead, and some even complained that the water in the taps was not fit for

drinking, which rendered their provision somewhat ineffective. Many believed

that the CSR activities were tokenistic, and not necessarily in the best interests of

the village.

As an answer to a question in the Vidhan Sabha in 2011, Jindal Power Limited

(which owns both the coal mines in Sarasmal and Kosampalli, as well as the

power plant in Tamnar) reported that from 2006 to 2011, in the district of

Raigarh, it had spent only Rs. 46 crores on corporate social responsibility and

other activities, having promised, at the start of 2006, to spend at least Rs. 150

crores over three years.25According to its own admission, however, it has failed

to spend even a third of this amount over five years.26Moreover, in each year,

among its largest expenditures on CSR is on the development of and student

welfare in the O.P. Jindal school in Raigarh.27This, however, is a private school in

the city of Raigarh, not benefitting the children of any affected people in the

villages of the district (a fact that has not gone by unnoticed in the rural areas

affected by industry and mining).

25Information submitted in response to Vidhan Sabha question no. 767 (b), asked by MLA

Mohammed Akbar in the Monsoon session of 2011. The document contains information on

previous conditions fulfilled by industries in the state of Chhattisgarh. This document was

obtained under the RTI act in Raigarh.26The figure for the first three years is even lower, just under Rs. 40 crores.27Expenditures on the O.P. Jindal School in each year are as follows: 1.4 crores in 2006-07

(biggest expenditure that year); 3.18 crores in 2007-08 (biggest expenditure that year); 2.16

crores in 2008-09 (third largest expenditure); 10.5 crores in 2009-10 (third largest); 38.9 lakhs

in 2010-11.


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The District Collector of Raigarhs note on proposing a new CSR policy also notes

that present CSR spending is arbitrary and ad-hoc in nature, that there is

inadequate monitoring, and that people are generally skeptical of companies

efforts, which the document acknowledges are often ingenuine.28In an effort to

streamline CSR with the development agenda of the district, Raigarh has set up acommon fund at the DCs office, which will collect CSR money directly from

companies, and set up a monitoring cell to ensure that it is used productively and

for genuine development efforts.

5. Role of the State in the context of the new land acquisition lawAs we saw in Raigarh, although land transfer implemented by the State was

accomplished through means that formally appear legal, they often involved

practices that were not substantively legal and threatened the rights of the very

people that the law was meant to protect. Affected families had difficulty in

telling the State and the private industry apart in the land acquistion process,

which suggests either that the two acted in tandem or the outcomes of the direct

land transfer and compulsory acquisition by the State were not vastly different.

Even if private companies alone were responsible for the disregard for law such

as that observed in Raigarh, the State is complicit in the act by its very absence

and inability to prevent such practices.

28Approach Note for CSR Policy in Chhattisgarh, 31 March 2012, District Collectorate, Raigarh.

Alternative mechanisms: The role of community mining

As an alternative to big companies mining land, residents of Gare in Tamnar

have launched a campaign for what they call community mining, where

landholders themselves will be in charge and will directly reap the profits of

coal mining. On 2 October 2012, villagers symbolically broke what they called

the koyla kanoon, saying that if coal mining is essential for the development of

the nation, then they can do this themselves, by setting up a company in which

the villagers are shareholders, so that they have an equal stake in what

becomes of their land.1 In return for this, they are willing to pay the

government ten times the royalty that mining companies pay. In the case of

Gare, which falls within the disputed IV/6 Gare-Pelma coal block, the mining

rights for this coal block have already been allotted to JSPL in 2006. The

company had until 2012 to acquire land, get environmental clearances and so

forth. The only way in which the community can ask for this allotment to be

revoked is if the corporation does not adhere to the timeline and the

community asks for the rights instead. So far the government is silent on the

issue, with matters being complicated by the fact that the JSPL has failed to

acquire the requisite land and environment clearances in the stipulated time.


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However, with the State unable to execute public purpose at the speed and with

the efficiency necessary to meet its development goals, there appears to be no

viable alternative at present to the idea of private involvement in executing

public purpose. Some alternatives have emerged to the development process

being managed by local communities, without the involvement of the State orprivate companies (see box on community mining in Gare), but these are largely

isolated incidents and have received little support from the State.

There is little consensus at present on how the role of the State should change, to

respond to the new challenges that emerge as a result of the withdrawal of the

State from taking a lead role in this process. In such a situation, the land

acquisition law in the country becomes an extremely important tool for setting

clear guidelines for the State, as well as codifying a minimum standard for large-

scale private land transfers. Currently, there are at least 4 prevailing views about

what the role of the State should be in land transfers between private companies

and landowners, for public purposes:

i. Hands-off Policy: One important view is that the state should havenothing to do with compulsory land acquisition for private companies. If

private companies need land, they should negotiate with the landowners

and pay them what they demand, if they choose to sell their land. If they

do not, then they should not be forced to do so by the state.

The willing buyer-willing seller model is said to be an efficient mechanism

that allows for the two parties involved to directly negotiate a price

acceptable to both and accounts for subjective preferences that could be

higher than the objective rate of compensation decided by the State.

However, the Raigarh experience shows us that this is far from the case.

Between the acquirer and the affected person, the balance of negotiating

powers is tilted in favour of the acquirer who has more resources, access

to more information, more agency and is better organised than the land-

and livelihood-losers. Thus, the probability that coercive tactics and

intimidation will be used to persuade unwilling sellers to become

willing sellers at a price acceptable to the acquirers is quite high. In the

case of Raigarh, common tactics used to intimidate landowners were the

dumping of earth and other materials on the fields and blocking access to

the fields.

Another problem with this approach is that the receiving company is not

obliged to undertake R&R, or offer adequate compensation. What goes in

the name of CSR is no substitute whatsoever to a rights-based legally

binding entitlement of R&R (which we shall see the new legislation, nowin force, does address).


31/35


ii. The 75:25 Approach: A second approach is that the private companyshould be required to first purchase a certain proportion of the land

themselves, say 75% or 80%, through the willing buyer-willing seller

model. It should then be their right to approach the state to compulsorily

acquire the remaining land for them.

This option is often touted to be optimal for growth in terms of

discouraging the holdout problem that often delays projects that provide

a clear public benefit. When the option exists for people to claim

compensation by the government by holding out, they can in theory

refuse any offer that is lower. It would appear that this option leaves the

affected persons best off, by encouraging private companies to provide

higher compensation, but this is not so. This method also discounts the

imbalance of powers between the two negotiating parties and those

without agency again are vulnerable to exploitative sales. In the case of

Raigarh, we saw that powerful landowners were the first to sell, and on

average received better compensation than the smaller landowners, who

were from the SC and ST communities. In addition, the threat of forced

acquisition by the government was used to force landowners to sell their

land to the company.

This approach in fact benefits private parties the most as, in effect, there

is no real cost to the company from the holdout, with the government

guaranteeing that land will be acquired from the recalcitrant landholders.

There is therefore no incentive for the company to offer compensation

packages higher than that offered by the State. Furthermore, this leaves

no choice with the affected person about whether their land should be

acquired or not (unlike the hands off approach) and can be especially

harmful when the public benefit is hard to establish, when the State sides

with the private company and/or when the legal provisions for

compensation and rehabilitation are insufficient.

iii. Compulsory Acquisition Only by the State: A third view is that all landacquisition for public purpose should be done by the State, and not by

private companies. This hopes to address the inequality in bargaining

power between the company and the landowners, which often leads to

coercive sales, putting landowners at a disadvantage. This method is

meant to ensure that the acquisition is legally implemented and adheres

to minimum standards for compensation, rehabilitation and resettlement,

as mandated by the law.

Our findings in Raigarh show that this is not necessarily true, and that thestate is also susceptible to powerful influence and corruption. Grievance


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redressal was ineffective, since filing an appeal did not mean that the land

was returned, neither did compensation increase. However, proponents

of this view argue that it is the least unfair of all the methods. The

presence of the State as the negotiator creates an accountability towards

the people that private companies do not possess, whether in matters offairness of transaction, compensation, consent, or other pertinent issues.

This view argues that the state, however flawed, nonetheless has more of

an incentive to act in the public interest and that this is the most equitable

(or least inequitable) approach to land acquisition.

iv. Choice Between Direct Purchase and Compulsory Acquisition: Afourth view is that the choice should lie with the private company;

whether it wants the government to acquire land or it wishes to approach

landowners directly.

More so than the 75:25 approach, this method provides some incentive

for companies to provide higher compensation than mandated by the

government, as there is no option to ask the government to acquire the

remainder of the land area in cases of holdout. However, when the

company chooses to acquire the land itself, this method suffers from the

same drawbacks highlighted in the hands off approach. When the

government acquires land on behalf of the company, this method has

similar outcomes to the one in which compulsory acquisition is

permissable only by the State.

The Right to Fair Compensation and Transparency in Land Acquisition,

Rehabilitation and Resettlement Act (hereafter referred to as the RFCTLARR Act,

2013) was passed in September 2013, replacing the Land Acquisition Act, 1894,

which, despite its colonial legacy, had continued to be in effect for more than a

half-century after Indias freedom in 1947. The earlier law was a mixed bag of

various approaches but adhered most closely to the 75:25 rule, even though no

such limits to how much land the company was required to purchase were set in

advance. This effectively amounted to a hands-off approach by the State, until the

company failed to purchase the entire parcel of land that it required for the

project. The company could in this situation request the government to step in

and acquire the remaining portion of the land through compulsory acquisition.

Indias new RFCTLARR Act, 2013 is a variation of the last approach, which allows

private companies to choose whether the government will acquire the land

through the procedures laid down in the RFCTLARR law or the company will

acquire the land through direct negotiation (willing buyer-willing seller).

However, in situations where the company chooses to approach the governmentto acquire land on their behalf, they are required to get the consent of 80 percent


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of affected families (70 percent in the case of public-private partnerships). When

the companies acquire the land themselves, they are also required by this law to

provide compensation, rehabilitation and resettlement to affected families, in

cases of large-scale acquisitions. Our dominant concern is that if the companies

do choose to or are compelled to buy the land for themselves, as in Raigarh,strong-arming and intimidation tactics will continue. There is also little guidance

on how compliance with the law will be monitored, for example in ensuring that

affected persons were correctly identified, compensated and rehabilitated.

All the methods mentioned above, except for the one in which only the State is

authorised to acquire land for public purpose, require that the State be present

as a neutral arbitrator and a guardian of rights for the affected person, to prevent

the unjust land transfer practices observed in Raigarh. The absence of the State

in this capacity has grave consequences for those affected, including, but not

limited to, displacement without resettlement and rehabilitation, health

problems and loss of livelihood. Only the State can hold private companies

accountable for delivering large-scale public benefit without imposing a

significantly larger public and environmental cost. At the same time, the law

governing land acquisition by the State should also impose strict guidelines on

the State for when compulsory acquisition can be exercised, what its

responsibilities are and any such law should pay particular attention to

recording and resolving public grievances. The RFCTLARR Act attempts to

accomplish this in three ways:

i. Defining Public Purpose: The Act gives us a list of public purposesfor which land can be acquired under provisions of the Act. These

include, among others, strategic defence and national security,

permitted infrastructure projects, housing and urban development,

residential housing for the poor and landless, as well as land for

persons displaced or affected as a result of natural calamities or

schemes implemented by entities owned or controlled by the State. In

Schedule 1 of Section 2 in the RFCTLARR Act, 2013 projects for

industrial corridors or mining activities, national investment and

manufacturing zones, as designated in the National Manufacturing

Policy are considered within the scope of public purpose. The list

clearly lists the purposes for which the law applies and is, therefore,

less open to interpretation than its predecessor. The list has no open-

ended clause for other purposes that are unforeseen at the time of the

drafting of the law, as is common in some other countries. However,

the list of permitted infrastructure projects allows for other projects

to be included within in by tabling a notice in Parliament to that effect.

It must be noted here, however, that there are no constitutionalprovisions or guidelines regarding compulsory land acquisition and


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should ideally protect the interests of the affected persons, the Raigarh

experience shows that malicious intent often leads to circumvention of the law

and coercive practices to obtain consent, even if the language of the law dictates

otherwise.

The RFCTLARR Act, 2013 also inexplicably exempts some important laws from

the acquisition, rehabilitation and resettlement procedures laid down in the Act

for a year from the commencement of the Act. These laws include the Railways

Act, the Coal Bearing Areas Act and the Land Acquisition for Mines Act, which are

among those under which the largest amount of land acquisition takes place.

While this schedule already includes thirteen such laws, the Centre can add to or

subtract from this list by executive notification.

Even though the new Act has generous entitlements for affected families (not

just land losers), the States demonstrated bias towards supporting private

industry at the expense of the affected persons means that private land-owners

could continue to be pauperised, receiving rock-bottom rates for land, which

either the state formally acquires from them, as it did for state implementation of

public purpose projects in the past, or land which they voluntarily sell to

private companies. Without sensitive institutions, participation of local bodies

such as the Gram Sabhas and participation of the affected families themselves, it

is unlikely that the experience of affected families under the RFCTLARR Act,

2013 will be vastly different from those in Raigarh.

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