The Land Bill is more of a social legislation than an economic legislation and will push up cost of investment manifold. Corporate houses are definitely not against farmers getting right compensation, but any law of the land should strike a right balance between agriculture and industry development.
To say that fresh investments would be hit because of the Bill may be an exaggeration, but it will surely add to the pile of things that are already loaded against the manufacturing sector. Over the last few years, the Government has been boosting manufacturing to minimise the dependence on agriculture for economic growth. But the Bill will make manufacturing activity in India a costly affair and result in flight of capital, as there are ample opportunities abroad.
The Law will bring more certainty on a critical issue impeding infrastructure development. The Government may need to bear the cost of land acquisition since user charges may not be able to bear the cost in all cases. This balance between cost to tax-payers and users remains critical in the design of PPPs.
Manish Agarwal, Executive Director (Infrastructure), PwC India