As land costs go up, Road Minister Nitin Gadkari on Friday said there was scope for developers to provide some equity in projects to farmers whose land has been acquired to build roads on build-operate-transfer (BOT) basis.

“Farmers can be made partners in development…They can be given some equity or some revenue share from the toll revenue,” said Gadkari. He said this on the sidelines of a CII conference on public-private partnerships, adding that these were his views and were yet to be converted into a proposal.

Landowners could be partially given some upfront compensation as well as some annuity form of income over the years, the Minister said. A few States have implemented such models where a group of farmers have a holding company.

‘Difficult to maintain’ However, many developers did not seem too think this was a good idea. When asked for a response, Arjun Dhawan, President and CEO, HCC Infrastructure, said: “I think that relationships are difficult to maintain over a long period of time, say, 30 years. To add another entity will be difficult. I am all for direct transfers. But, that is not something that the private sector is good at doing…Do not add a third party in an area where there is already dispute.”

Raghav Chandra, Chairman, National Highways Authority of India, said: “It would add to transaction costs. After the new Companies Act, it would invite a lot of paperwork. However, if at all it has to be done, State governments should create its own company for creating land banks where people who want to contribute their land can be offered part equity.”

CSR spend K Ramachand, Managing Director, ITNL, said: “While it is not a great idea to add the number of stakeholders, ITNL, as company, makes it a point to ensure income upgradation of land owners. We do a lot on education, women’s health…May be the 2 per cent CSR spend can be mandated to be spent in that area.”

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