The Hindu Business Line : Quicker legislation

Much as the government would like the nation to believe in its ability to sustain current levels of economic growth, the case would be more convincing if it steered some critical pieces of legislation through Parliament quickly. Recent events indicate that the ruling coalition could sour its record of growth so far in the run-up to the forthcoming elections, both in the States later this year and the general elections in 2009. The first incident is the eruption of violence in Nandigram, West Bengal, a few days ago, despite the State government having made no move to acquire any land for industry. The second is the post-Budget 30 per cent rise in cement prices and 20 per cent hike in steel prices that have provoked policymakers to talk in undertones of cartels and threaten stricter measures including the use of an old provision from the nearly defunct Industrial Development (Regulation) Act 1951 to assure cheaper supplies. The third is the discrepancy evident between intent and practice in coal mining development. While officials are all for private leasing of new coal blocks, the enabling legislation is yet to be passed by Parliament. The sporadic violence over land acquisition and the unnecessary invocation of an archaic law to browbeat cement producers and manage prices reflect lethargic policy-making at a critical juncture of economic growth.

As it is, the amendments to the 1894 Land Acquisition Act were introduced as late as last year despite overwhelming evidence that land acquisitions have long been problematic. After all the raging controversies over townships and Special Economic Zones, the amendments to the 1894 Act and the fortified provisions of the Rehabilitation and Resettlement Policy 2007, crucial as they are to fresh industrial capacity, are yet to become law. The refurbished Mines and Minerals (Development and Regulation) Act that, breaking from the past, promises competitive bidding for private leases suffers the same fate.

If delays in the two land laws alienate the dispossessed, the undue wait for the updated anti-trust Competition Commission has left industry wincing at the prospect of the government using arcane laws to twist its arm. Ditto for the mining legislation because, even if the land transfers proceed smoothly, the nitty-gritty of leases still need sorting out if investors have to put in money and technology. The treasury benches have to push the unfinished business to the top of Parliament’s agenda so that the Opposition wakes up to the criticality of the issues. Regardless of which parties assume power in the next elections, the need for land, better coal for power and cheaper cement will stay with us a long while.

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