The archaic Land Acquisition Act of 1894 is set for amendment and there are many significant issues to be raised in this context. Most important now is how the government will recast its rehabilitation and resettlement (R&R) policy. It is proposed that the amended R&R policy will vest the government with some statutory authority, which it did not have in the earlier R&R policy of 2004.

The Act, in its amended form, will reduce the permissible period, by which time land acquisition procedures must be completed. Disputes are entrusted to an Ombudsman and Special Tribunals to expedite resolution. No civil court will have jurisdiction over these cases.

The amended Act will also define `public purpose` in a radically different way. Land can only be acquired for strategic and infrastructure development projects, which will have direct and indirect government involvement. Companies and private sector entrepreneurs will have to buy land themselves for setting up of their industries. They will have to negotiate directly with the willing landholders to acquire land for a consideration.

The government, however, will intervene on behalf of an entrepreneur to acquire land if that industrialist has acquired 70 per cent of his project-specific land area. This land will be acquired at the same market price at which the land already held by the private party was bought.

In such cases, the livelihood and R&R entitlements of the landless, including labourers, artisans and others, are to be ensured by the company. Failing the provision of employment, the company will have to protect the income of those who lose their land, at the same levels prior to the dispossession. According to a group of ministers, SEZ developers will ensure that the social and physical sources of project-affected people (PAPs) are not stopped altogether due to the project.

There are two issues that specifically require careful study. One is the price of land to be paid to the landowners and the other is the protection of their income.

Buying a contiguous stretch of land may obviously be out of the reach of a corporate house. In such a case, the state will invoke the power of law to acquire that portion of land specific for the project. States buying land for various projects will pay a `rich habilitation` price to PAPs of up to 75 per cent above the registered market rate. In general, the price to be paid will be 60 per cent above the average price being paid by the corporates and 75 per cent premium in special cases.

The well-meaning proposal states that the land-ownership rights be vested with the tribes. An estimated 85 million of the country`s tribal population will have ownership rights over the pieces of land on which they have been living for centuries. The compensation package assumes that each of the tribal family has land-ownership of up to 4 hectares, including forest-use rights. As PAPs, they will come under the R&R scheme plus grants. This provision will have particular reference to states such as Orissa, Jharkhand, Chhattisgarh, Madhya Pradesh and Karnataka. The land acquirer, in these tribal areas, will have to ensure the lifelong livelihood of the entire tribal community, in terms of providing jobs in industrial units or imparting training to them for their employability. This forms part of a general policy for the tribal community. The guiding principles in the policy stress that the tribals will be provided land against their lost land, the market value of land, the application of the concept of net present value (NPV) of assets and the undertaking of a social impact assessment.

For the rural folk, in general, some changes have been made to the earlier 2003 national policy of R&R for the project-affected families. The policy is known as National Policy of Rehabilitation and Resettlement (2007). The government also wishes to set up a National Rehabilitation Commission, which will be empowered to exercise independent oversight over the R&R of the PAPs.

Compensating the uprooted families is still a major concern for the government, and it should be. It is natural for the private sector to give as low a price as possible to a family whose land to be acquired falls within the SEZ. Without any mechanism in place, valuation of the land based on its `historical value` will deprive the land-owners of a fair price in process of SEZ development, as the value of the land at the time of project notification is usually much lower than when project work undertaken. The truth of this can well be assessed by observing that land values move steeply upwards in areas around sites indicated for SEZ development. This is because these peripheral areas may be taken up in the near future for various activities associated with the SEZs. The anticipated huge price differential over a couple of months or more will create a social chasm within the same type of families living and then leaving their land held so far for generations together.

For instance, 1,500 affected farmers in the multi-modal international hub at Nagpur (MIHAN) project have to give up their land at Rs 3.8 lakhs per acre for irrigated land. Against this, a large block of land running outside the airport was sold recently for Rs 2.55 crores an acre! An element of discrimination is palpable and beyond rectification in the present policy of land purchase and land acquisition.

Bigger is the problem of protecting the earning potential of the PAP. Though they may be compensated for the loss of their land, there is no clear policy yet that they will be provided with alternative employment. Uprooted from the land on which they have laboured hard to earn their livelihood, these families have no technical skills or knowledge to work in completely alien conditions such as in that of an industrial unit. It is not yet incumbent upon the new entrepreneurs to hire the land-owners in their industrial projects. The land-owners are not cut out for industrial work, and this becomes the main ground for their disqualification.

An idea floated was that though these displaced persons can be given low-level workers` status in the new industries to be set up in an SEZ, they would be better compensated by making them shareholders in the corporate ventures. This idea has failed to convince either side. The state government cannot have a role in it. The farmers, being away from the equity culture, will not be enamoured by this prospect. The industrialist will not welcome this idea because calculations of share value to be related to the land value will not be to his/her advantage. If made equity holders, the land owners will have proprietary interest and as such will cease to be workmen under any labour laws. Trade unions cannot come into the picture. This class of people will have no redressal mechanisms open to them. In addition, by parting with their land, they will cease to be farmers and, hence, will be not be part of any kisan sabha.

The important issue of the environment has not been addressed in the SEZ proposals. Whether marine life will be affected if a chemical hub comes up in the underbelly of West Bengal at Nayachar is still the concern of an elite segment of the people. When the fish and other forms of life are destroyed because of the chemical hub, the damage will be too deep and rectification measures will offer no solution. People living off riverine resources will go off the scene altogether.

Despite all of these concerns, 439 formal approvals have been granted for SEZs, spread over 60,168 hectares.

SEZs have arrived in India. Because of this, a sizeable area of the country`s landmass will undergo a radical transformation. A large number of people will lose their identity and living. Unless the powers that be address these problems, there will be political and social unrest in the country. As it appears, the gains of expected industrialisation will be greatly offset by huge social losses in the country.