Its land, stupid……Pratap Bhanu Mehta
The issue of land acquisition is not just a technical issue about compensation to farmers. It has now become a poison that is sapping the very foundations of our republic in both economic and political terms. Power projects, roads, universities, businesses and even schools cannot get off the ground because of land issues. The distortions in the land markets are producing asset prices that probably have a direct bearing on high inflation. But even more importantly, the political economy of land is destroying politics in this country beyond redemption. The discretionary power the state has with respect to land is the single biggest source of corruption in this country. Vast fortunes have been amassed by a nexus of politicians and developers. Several astonishing companies have arisen, on seemingly nothing but their ability to manipulate the political process. The three areas which are the least liberalised and the least transparent are land, liquor and learning. It is no accident that the stamp of political patronage is most widespread in these areas. The revolt against land acquisition is as much a revolt against a corrupt state as anything else.
Land acquisition has also become a mechanism for exacerbating inequality in India in three ways. First, property rights were weakened in India to facilitate land reform. Ironically, weakened property rights, which were meant to help the poor, ended up dispossessing them even more.
Second, what farmers think of land acquisition depends, amongst other things, upon two factors: location and their existing assets. Again, ironically, farmers in an area with a real estate boom or high circle rates like Haryana are more likely to be willing to part with their land than farmers in poorer states. It is not an accident that land acquisition is harder in backward states like Orissa, West Bengal and parts of Uttar Pradesh. The poor get a poorer deal in a poor state. High growth states like Gujarat have less of a challenge. As the recent conflict in UP has shown, large farmers also have a greater capacity to bargain, compared to small farmers, and are likely to get better deals. So dispossession is also unequal in its effects.
Finally, there is one aspect to inequality in land discourse that is deeply insidious. There is some focus on monetary compensation and promise of jobs. But let us face two ugly truths. In most areas we have not invested enough in the skills of dispossessed people for them to get meaningful jobs. Studies are showing that, particularly in backward areas, companies do not employ local labour: partly because of skills deficit, partly because of fear that local labour will unionise easily. But there is also an aspirational dimension. Even in Singur, it was startling to see the government promise jobs as janitors to those dispossessed.
Contrast this with what the mayor of a Chinese city is supposed to have told those displaced. He admitted that the adults will have to sacrifice, but the promise was that the children of those displaced would have the same opportunities as those of the most privileged. And the state would ensure that. Whether or not this is entirely implemented is not the point. The point is whether any Indian politician looks at the children of the dispossessed in the eye and promises them something genuinely aspirational: a first rate, instead of a third rate school; a dream of a great job, instead of jobs low in the hierarchy. Land acquisition is often an occasion for reproducing social distance rather than closing the gap.
It is important to be reminded of this backdrop because land conflicts are not just over compensation. The compensation issue has become a distillation of a complex set of issues: low trust in the state, resentment at inequalities that your encounter with the land lottery can only exacerbate, and a politics that rests on the conviction that power is arbitrary and access to it simply a means of making money.
The land issue will come to haunt us in even subtler ways. It is an open secret that the land acquisition economy is still significantly a cash economy. This cash cannot often be translated into other investible assets, except land. And the only way to protect these assets is often self-protection with guns. There is some evidence of an unprecedented level of gun culture in Indias countryside, and the potential for violence is growing. There is widespread agreement that patterns of urbanisation will be absolutely central to Indias future. But the pattern of urbanisation is being severely distorted, not just by urban land mafias, but the way in which land planning is being done around highways in rural India, one of the subjects of contention in UP.
Corporate India must wake up to the fact that land acquisition has the potential for wrecking the social legitimacy of capital. It is the one sector that consistently gives grist for the mill of those who think Indian capitalism is largely crony capital, and hence illegitimate. Finally, land acquisition is also a bone of contention in another important debate, decentralisation. The one area where rights of local government are routinely sidelined is land.
Land has become the embodiment of almost every significant fault line in Indian society. Much of this conflict generated is needless, a product self-defeating and untransparent land acquisition regulation, and wilful hubris by the state. It is therefore even more unconscionable that the government put off discussion of the Land Acquisition Bill, so that these issues can fester. All political parties, in one state or the other, have acquired a vested interest in keeping conflicts of land alive; it is becoming a favourite instrument of choice with which to embarrass state governments. For example, the Trinamool Congress, so exercised by the land issue, seems in no hurry to see legislation enacted. The Congress is more interested in schemes that look like an act of noblesse oblige on part of the state, than in pushing legislation that can bring about fundamental structural transformations in the way in which the poor can negotiate with the state and large corporations. This Parliament session has largely been a legislative whitewash, and it would have been entirely appropriate to make discussion on this bill a priority. There are several issues in the bill that need to be sorted out. But the fact that comparatively low priority is being placed on it speaks volumes about our complacency.
The UP issue may be resolved by renegotiating compensation levels. But the land wars are brewing all over, corrupting the state and the nation at its very core.
The writer is president, Centre for Policy Research, Delhi