Land acquisition delays costing US$100 Bln: Study
Delays in land acquistion are costing the industry investments worth US$ 100 billion all over the country in near term. This was highlighted by the Assocham Eco Pulse (AEP) Study titled “Land Acquisition Scenario in India”. However, a complete dichotomy between the public and the private side remains largely evident. On the same day, at one hand the National Highways Authority of India (NHAI) aims to halve the time taken for land buys from approximately 24 months to 11 months while on the other, Arcelor Mittal, the world’s largest steel maker is close to pulling out of US$ 20 billion to build two large steel plants in Jharkhand and Orissa due to delays in persuading farmers and others to sell the land.
This is a serious concern which demands immediate solution to bolster economic recovery. The Study reiterated that according to an assessment report released by the Indian Steel Ministry, 22 major steel projects in the country worth US$ 82 billion are being held up because of procedural delays in obtaining environmental impact assessment clearance, delays in land acquisition mainly due to public protests, and the global economic downturn.
Endangering the 150 million tonnes capacity addition target of the Steel industry by 2015, some of the major domestic and international players affected by the delays include ArcelorMittal, Essar Steel, Jindal Steel & Power Ltd, Posco and Tata Steel.
The government needs to ensure efficiency in 3 ‘R’s, i.e., Remuneration, Rehabilitation and Resettlement to accomplish the policy objective of fair value based on integrated approach for land acquisition, said Sajjan Jindal, president, Assocham. The escalating cost of compensation is also forcing up the cost of projects, thereby affecting their viability. The Chamber chief referred to a recent Study done by the government showing at least 70% of 190 delayed infrastructure projects have been stalled on account of problems over land acquisitions, especially the compensation to be paid to landowners.