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The Big Land Pooling Experiment!

Published on Sat, Oct 24,2015 | 11:41, Updated at Mon, Oct 26 at 18:40Source : |   Watch Video :

It’s a special show this week as The Firm travels to Andhra Pradesh to find out more about India’s most ambitious land-pooling scheme. Since the bifurcation of the erstwhile state of Andhra Pradesh, Hyderabad has been a shared capital for both the new Andhra Pradesh and the new Telangana. They will share Hyderabad for 10 years after which the government will have to move to a new capital city. That new city – Amaravathi – is being built on over 30000 acres of farmland. The Andhra Pradesh government has not acquired this farm land. It has instead launched a land pooling scheme. This may not be the first time land pooling has been tried in India. But it is surely the most such ambitious effort. Aayush Ailawadi visits Amaravathi to find out if it will work!

This is where our journey begins. We’re on our way from Hyderabad to Vijayawada, where the Andhra Pradesh government plans to build a capital city from scratch using an innovative tool called land pooling. Is this land pooling experiment working out for them? Well, let’s find out…

300 kilometers from Hyderabad… in the middle of one of India’s most fertile rice bowls, will soon be born the city of Amaravathi. Located between the towns of Vijaywada and Guntur, Amaravathi will occupy 54000 acres, that will over 10 years house Andhra Pradesh’s secretariat, the high court, the legislative assembly and other structures. It will also be home to 30 lakh people.

Of that 54000 acres, nearly 21000 acres is already owned by the Government. The remaining is owned by over 23000 farmers across 29 villages. Acquiring the land would have cost the AP Government more than 7500 crore rupees and would take several years. Add to that rehabilitation and re-settlement requirements to be fulfilled under the Land Act, 2013.

So, in December last year the Andhra Pradesh government announced a land pooling scheme. That same month it enacted the Capital Regional Development Authority Act, under which it created the Capital Region Development Authority. The CRDA’s first development commissioner, N Srikanth is in charge of building Amravathi. He tells me that no other state has ever experimented with land pooling on such a large scale.

Ailawadi: Mr. Srikanth, why did the AP government choose land pooling as tool to build the capital city?

Srikanth: The govt wanted to make the landowners and those living in that area stakeholders in the entire process of development. the moment the govt announces a capital city, the land prices there are going to go up in value and that increased value should be shared with the people who have been residing there, so land acquisition act is a one sided act in the sense that there is nothing which is shared with the people who were protecting or enjoying the land till that point of time. And its not a win win kind of situation, if you give cash it may not last long whereas if you make them stakeholders in the development process, then the chance of success is more for any project that you take up. and there has been tremendous support for locating the capital city and as per the cabinet resolution and the assembly resolution it was located here, and the state govt came up with this land pooling system where every acre of land surrendered under this process, the land owner would be getting part of the developed land back. so, that was the context in which this was done.

Under the Andhra Pradesh Capital City Land Pooling Scheme, landowners voluntarily transfer ownership of the land to the Capital Region Development Authority. The CRDA develops the land by building the necessary infrastructure- like roads, sewage lines and electricity connections. After 10 years, once the land is developed, the CRDA will return approximately a third of the land to the landowner. The Scheme also provides other benefits.

So for instance, if a farmer was to give up 1 acre or 4840 square yards of dry land for pooling, in ten years, he’d get 1000 sq yards of residential land and 250 sq yards of commercial land. By then the land would be more valuable due to the surrounding development. During the 10 years the farmer would get an annual payment of Rs. 30,000, with an annual increase of Rs. 3000. He would also get skill training and be entitled to a loan waiver of upto Rs. 1.5 lacs. Landless labourers will be compensated with Rs. 2500 every month. The Government claims the land pooling scheme has already attracted 31,000 acres.

Ailawadi: Is this land pooling scheme backed by any central or state law?

Srikanth: We have studied certain laws from the existing town planning scheme as well as other urban planning schemes elsewhere in Gujarat, Maharashtra, Tamil Nadu, and chattishagarh as well as Andhra. Based on all these experiences as well as other legislations in the world and other democratic countries, and we have realised that this was possible. So, a special legislation was created for the purpose of pooling the land.

Ailawadi: What if this project takes much more than 10 years- maybe 15, 20 or 30 years, what legal remedies do the the farmers have in that case?

There is no other choice for the state govt, once the decision is taken that the capital city will be located there, the entire master plan which is being prepared now will be notified and under law. The cabinet, as per the cabinet resolution and assembly resolution, the secretariat, the high court, the legislative assembly, everything will move there, just as it had happened in Raipur or Gandhinagar or elsewhere in the country. It has to move so there’s no way that this can get delayed and the govt already has indicated that 2018 will be the deadline for moving the govt there!

We’re looking at 33, 000 acres of fertile land on the banks of River Krishna. This is where the AP government plans to build a capital city from scratch. So, let’s head to the fields to find out what the farmers really think of the government’s plans…

The village of Mandadam is located close to the proposed centre of the capital city. Most farmers belong to the same caste as the Chief minister and are die-hard Naidu fans. They unanimously support the land pooling scheme.

N Kondayya
"I have given 24 acres of land for pooling. I expect CM Naidu will be in power for 10 years. Amravathi will be developed in 10 years. Naidu thanked all of us farmers. We have all chosen to give our lands for pooling voluntarily!"

Our next stop, Thullur is a village at the very heart of the proposed capital city. Not only do most farmers here support the land pooling scheme. Some are using the prospective development to cash out.  

Ram Babu

"I owned land 1 acre of land in the capital city. Because prices went up I sold it for Rs 1.6 crores and I bought land 7 kms away for Rs 1.4 crores, so I have made a profit of Rs 20 lakh. I am happy as I’m still a land owner and I have extra money too…"

K Ramaiyya

"I had 4 acres of land. I sold 1 acre  and I’ve given 3 acres to the land pooling scheme as I trust Chandrababu Naidu and I wanted the annuity."

But not far from Thullur, in the village of Penumaka most farmers belong to the Reddy caste. Many here are opposing the land pooling scheme. 35 year old Srinivas Reddy owns 1.2 acres of multi crop fertile land on the banks of the Krishna river. But he’s being offered the same terms as others. And so he believes the Government has undervalued his land and also that the annuity is insufficient to support his family. Reddy and a few more villagers have moved the high court to block the pooling scheme.

Srinivas Reddy

“Land pooling act is illegal. They are saying that that we must try land pooling and are taking the land from us legally, but they are only giving us verbal promises and not giving it to us in writing."

Earlier when I spoke to the CRDA Commissioner he said the Govt was talking to the dissatisfied farmers.

N Srikanth
Commisioner, CRDA

"There is a small pocket of contiguous land, where the land values were very high so probably we may have to enter into a dialogue with them and then solution will come up..."

But, Penumaka is not about to back down easily. The villagers will make themselves heard when Prime Minister Modi visits on October 22nd, to lay the foundation stone for the capital city. They intend to request the PM to exclude these villages from the capital city’s development plans.

Naresh Reddy

“Mr. Prime Minister, please take the dry lands and spare our multi crop lands. This is god’s gift to us, so please do not take it away from us. Even our coolies earn around Rs. 20,000 per month right now and their life is good. Under this scheme they will only get a measly amount as pension."

That’s another concern. Many Coolies or Landless labourers are unhappy with the 2500 rupees a month pension the scheme offers them.

Coolie/ Landless Labourer

I make Rs 300 a day, that’s Rs 9000 a month! This government is only giving us Rs 2500 per month as compensation and that won’t be sufficient for us. How will we pay for house rent and children’s education? My husband and I work long hours, but if these fields are taken away, what will we have left to eat? What about us? This is the only job we know how to do."

If some Farmers and labourers are concerned about the undervaluation of land and insufficient pension, land policy experts and lawyers are worried about the very legality of the land pooling scheme. After this break I’ll see you in ISB with professor  Ashwini Chhatre…

Welcome back, you’re watching The Firm… where we’re examining the Andhra Pradesh government’s land pooling experiment for the new capital city of Amaravathi…

Now, traveling through the capital region of AP, we found out that nearly 90% of the farmers are on board with the government’s land pooling scheme. In fact, they’ve already submitted their land for pooling. But, experts have some concerns. That’s why we driven down to Hyderabad and we’re here at the Indian School Of Business to get some expert opinion…

Professor Ashwini Chhatre teaches economics and public policy at ISB. He’s spent 11 years working with local communities and social movements on democratic governance of natural resources in India and has also studied the state government’s land pooling experiment very closely. He tells me that landless labourers would be the worst affected by such a scheme…

Ashwini Chhatre
Professor, Economics & Public Policy
ISB, Hyderabad

"In the Andhra experiment there are two concerns. One is a significant proportion and I'm not aware of exactly how much but I would make a guess - 30% are landless people. So if you assume that land prices are going to increase 10 times, 20 times, which is a reasonable assumption in these situations, the benefits are going to be very regressively distributed. So the landless people will get some skill training, some annuity, 2500 or whatever that increase is 10% per month, the land owners are going to get a lot and the one acre land owner is going to get a lot less than the 10 acre land owner. So you are actually increasing inequality in the system and basically inequality breeds more inequality. In a year, two years, five years down the line, land prices really start to increase and the land deeds that these people have received start to trade so that they start selling their land to private entrepreneurs who will of course come in and buy them, the landless people are going to get very disaffected."

Rising inequality is one concern, but the bigger concern Professor Chhatre has is that the land pooling scheme has a very weak legal foundation.

Ashwini Chhatre
Professor, Economics & Public Policy
ISB, Hyderabad

"Based on conversations and rapid assesment, my sense is that there is no legal backing, except the law of contract. In this country and most countries the law of contract is based on Jurisprudence, its based on what courts have done previously. The lack of precedent will become a major impediment. So whatever decision is taken will have to be taken on the basis of whatever case material is, not on the basis of what has come before and long. Law of contracts has also proved to be really difficult to implement in land or land conflict. I'm not sure how much of these 33000 acres is jointly held. So if land titles are jointly held then the power of attorney is very hazy in law. Who has the power of attorney? Is it cumulative? Is it collective? Or even if there is recourse to due process. The experiment itself does not assign any responsibility to the government or liability in case of a dispute, its all going to the courts. So far its all looking good but the legal foundations are weak."

Well known advocate at the Andhra Pradesh High Court, C.V.R.Rudra Prasad shares the same worry. He points out that the both the land pooling scheme and the CRDA Act do not have adequate safeguards for farmers in case of disputes. For instance, if an ownership disputes arises, the farmer has recourse only to a writ court.

CVR Rudra Prasad
Advocate, Andhra Pradesh High Court

No, there is no legal remedy provided under the Act to the farmer. As a result if the State failed to comply with the conditions of the agreement, the only recourse to you is challenge their inaction by way of approaching the High Court because there is no mechanism provided. The Act says- the decision taken by the Competent Authority or the Commisioner is final and it cannot be challenged. Unlike the other enactments there is no appeal provided or an arbitration provided! For example, under the National Highway Authorities of India Act, an arbitration mechanism is provided. Under the Land Acquisition Act, you have a right of appeal or you can ask for reference to civil court. In this Act, there is no such provision. So as a result the land owners are the suffererers.

Rudra Prasad also says the land pooling scheme is discriminatory and hence unconstitutional.

"For example, some of the villages the value of the land according to the govt register is 1 or 2 lakhs per acre, whereas the value of the land next to the river Krishna are near Vijaywada or a town, Amravati or Mangalgiri, they are  10-15 lakhs as per the book value. Whereas market value more than one and half crores to 2 crores is there… But the CRDA is seeking to give land in lieu of the land taken by the farmers on par with anybody. As a result, those whose lands are of more value are getting less benefit, as compared to those who are giving at a lesser price. So, there is a discrimination."

Both experts, advocate Rudraprasad and Professor Chhatre are wary about how the land pooling scheme attempts to sidestep the provisions of a far stricter central land law. The Land Act, 2013 says government acquisition of land requires the consent of 70 to 80% farmers. It also orders a social impact assessment and comprehensive rehabilitation and resettlement provisions.  Since it is voluntary, the Andhra Pradesh Government’s land pooling scheme has no such provisions.

Ashwini Chhatre
Professor, Economics & Public Policy
ISB, Hyderabad

"One of the big things that the Land Acquisition Act especially the 2013 one brings in is the social impact assessment which would have addressed the concerns of the landless and the tenants who are going to benefit far less than the land owners. And there is no reason why you need the land acquisition act to do a social impact assessment. It adds to the transparency of the process and it can still be done.”

CVR Rudra Prasad
Advocate, Andhra Pradesh High Court

"Having realized that it is practically not possible for the AP govt, with the funds they have or the finances they have, they cannot acquire the land in such a huge extent and large extent of more than 30,000 acres, they have devised a method to acquire the land in other way in the name of land pooling scheme. If the entire enactment is made known to the land owners and the procedure being followed is being made known to the land owners, according to me most of them must not have parted with their land for this land pooling scheme, because under the Land Acquisition Act, a stringent regular mechanism is provided. They can raise objections under 5-A and 70 to 80 % of the land owners of that particular region, if they raise objection, then their land cannot be taken whereas under the scheme, the ‘rayaths’ are being offered such a benefits that they don’t know the future repercussions, so as a result they are being offered. And in most cases where a trivial litigation is there, the authority is rejecting their cases! These cases are not being projected, they are not being made to the public at large!! So, that’s where in order to circumvent the Land Acquisition Act, which is an enactment made by the Parliament, this CRDA Act is introduced."

Perhaps, it’s too early to judge whether the government’s land pooling experiment has been successful or not, but from my experience here, over the last 3 days, one thing is for sure- the government has clearly succeeded in convincing most of the locals to give up their land  to this particular scheme. Will the Andhra Pradesh government keep its promise? Will this capital city come up in the next ten years? Well, there’s only one way to find out and that’s if we come back here in the year 2025.
In Hyderabad, Aayush Ailawadi.

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