FROM THE VIEWSROOM. Factories or forests?

In seeking to industrialise in a hurry, the government is pushing for changes in land acquisition and environment laws that are politically shortsighted and economically flawed. The proposed changes in the Right to Fair Compensation in the Land Acquisition Rehabilitation and Resettlement Act involve diluting the consent clause in the case of PPP projects to 50 per cent from the existing 70 per cent, restricting the social impact assessmentto large projects and watering down the rehabilitation clauses. Alongside this move, the TSR Subramanian Committee seems to have suggested fewer no-go zones for mining and raised questions over gram sabha consent.

Changes in the land law could stoke the sort of agitations which, in fact, brought about the legislation — such as Singur, Raigad and Nandigram. The Singur agitation raises a basic question: Should land that yields three crops of paddy a year be used to make cars? By seeking to do away with SIA for most projects, such questions will never be answered. Are we to assume that a large factory is a public good, irrespective of the location? As EF Schumacher said, the discipline of economics is unable to put a right value on natural resources.

It is absurd to argue that rehabilitation is not important if the project-affected have given their consent and the cash compensation is generous. In fact, cash compensation should be substituted by alternative land and a stake in the profits of the enterprise, a concept that was perhaps first accepted by the Sardar Sarovar Narmada Nigam. Why are we turning the clock back?

The political consequences of forcible land acquisition can be alarming in Naxalism-hit regions in particular. Industry should accept the high cost of land as a constraint, given the lack of a safety net. There is scope to shred mindless red tape and improve contract enforcement. But there can be no compromise on regulations that protect natural resources and livelihoods.

A Srinivas, Deputy Editor

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