The Nuts And Bolts Of Appropriating Agricultural Land

How much land is actually transitioning from farm to non-farm use? The government itself puts the figure at 1.5% of net sown area between 1990 and 2003, or more than 21 lakh hectares. The actual figures could be much higher. Putting just this much land under wheat would yield 57 lakh tonnes of produce, enough to feed more than 4.3 crore hungry people every year.

The issue of land acquisition for the setting up of Special Economic Zones (SEZs) has focused national attention on the loss of agricultural land. Addressing a National Development Council meeting on December 23, 2006, Prime Minister Manmohan Singh said: “I agree that we must minimise the diversion of agricultural land and, given the choice, must opt for using wasteland for non-agricultural purposes. However, it must be kept in mind that industrialisation is a national necessity if we have to reduce the pressure on agriculture and provide gainful, productive employment to millions of our youth who see no future in agriculture.”

It is obvious that the prime minister’s statement was directed more at assuaging the violent opposition to the deprivation and displacement unleashed by land acquisition than at generating employment in off-farm activities for the rural youth. If this were not so, the government would have provided a figure on the threshold level for this diversion so that agricultural land is protected. In fact, the government itself does not know how much agricultural land has been diverted till date, as the Planning Commission’s July 2006 report of the Working Group on Land Relations for the Eleventh Five-Year Plan made clear.

The reason for this lack of awareness is not difficult to figure out: both the government and the private sector have partnered in appropriating agricultural land to promote industry, real estate, infrastructure, highways, dams, etc. All this purportedly to benefit the ‘public’, which somehow does not include people engaged in agriculture. The fact is that diversion of agricultural land for non-agricultural use will not only continue but also enjoy official sanction. As always, it is the poor who will pay in terms of livelihood loss and food insecurity.

Do numbers matter?

Are SEZs the only, or principal, reason for the diversion of farm land for non-farm use? Available figures indicate that large-scale diversion of agricultural land has been going on for more than a decade. At present, a little over 46% of the country’s area is cultivated. According to the ministry of agriculture, between 1990 and 2003 the net sown area declined by around 1.5%. While in percentage terms this may seem insignificant, in absolute terms it translates to more than 21 lakh hectares. On the other hand, between 1990 and 2004, land under non-agricultural use has gone up by 34 lakh hectares.

This extensive diversion of farmland has been facilitated by a relaxation of land acquisition and ceiling regulations post-1991, and has resulted in the State itself turning into one of the largest real estate brokers and developers in the country. All that the Centre did to protect agricultural land was issue the National Land Use Policy Outline to States and Union Territories, in 1986. Instead of full implementation, the state-level Land Use Boards have redefined their role to coercing farmers to give up farmland.

All across the country, agricultural land is shrinking. According to official figures, Tamil Nadu lost more than 10 lakh hectares of agricultural land between 1991 and 2003. Mineral-rich Orissa, Jharkhand and Chhattisgarh are losing agricultural land to mining and power projects. In Kerala, between 1997-98 and 2001-02, over 80,000 hectares of crop land were diverted for non-agricultural use. Even in the case of a small state like Himachal Pradesh, the net sown area has declined by 33,000 hectares between 1991 and 2001.

At a seminar on land use planning held at the National Centre for Agricultural Economics and Policy Research, New Delhi, in 1997, activist Sulabha Brahme stated: “The Maharashtra Industrial Development Corporation (MIDC) has so far acquired 35,000 hectares of land over 200 locations… It has planned land acquisition for 120 industrial areas/estates covering 30,000 hectares of land… Nine large industrial townships with sizes ranging from 2,000 to 7,000 hectares are planned… MIDC is also planning deluxe industrial estates for attracting NRIs and foreign companies… Land is being acquired by the government for private hotel industry and tourism development.” No wonder the MIDC website proudly proclaims that by 2002 it possessed more than 52,000 hectares of land with plans to acquire another 35,000 hectares.

In the neighbouring state, MIDC’s counterpart, the Andhra Pradesh Industrial Infrastructure Corporation (APIIC), expanded its ownership from 14,000 hectares in 2005 to 34,000 hectares in mid-2006. In November 2007, Tamil Nadu released its new industrial policy and announced that it would develop a land bank of 4,000 hectares to promote industrial development in the state.

This hunger for agricultural land continues unabated. Between 2002 and 2007, about 90,000 hectares of agricultural land across 25 mandals in and around Hyderabad have been diverted for real estate speculation and mega-projects. Another 63,000 hectares across 20 mandals of Ranga Reddy district have been lost over the past 10 years. These figures have been reported in a paper published in the August 4-10, 2007, issue of the Economic and Political Weekly by V R Reddy and B Suresh Reddy who estimated that a mind-boggling 5 lakh hectares of agricultural land have been lost in Andhra Pradesh in recent years. The authors feel this is a conservative estimate.

While the prime minister was at least trying to appear as if he was not advocating the poaching of agricultural land, some state governments have not bothered with such niceties. Take Chhattisgarh, where 80% of the population depends on agriculture. The state government’s Vision 2010 document states: “The existing rules prevent the diversion of agricultural land for industrial use. The state would simplify the procedures of diverting land from agricultural to industrial use.” To achieve this, the state proposes that agriculture be left to the 30% of farmers who presently control 70% of the agricultural land!

Besides industrialisation, agricultural land is also being gobbled up at an unprecedented rate in the name of infrastructure development. In some cases, the scale may be smaller, as with the World Bank-funded Allahabad bypass project which led to the acquisition of 781 hectares of prime cropland. Or it may be huge as in the case of the Ganga expressway project in Uttar Pradesh, which is expected to acquire 63,110 hectares. The Gangetic plains hold arguably the most fertile land in the country, and 70% of the land earmarked for the project is agricultural land owned and cultivated by farmers.

The National Highway Development Programme Phase V plans to widen 6,500 km of existing four-lanes to six-lane highways. Across the countryside, about 146,000 km of new roads are planned, and a dedicated programme, the Pradhan Mantri Gramin Sadak Yojana, has been going on since 2001-02. The Cabinet Committee on Economic Affairs, meeting on January 10, 2007, called for an amendment of land acquisition laws to enable the speedy acquisition of agricultural land for Rs 5,000 crore railway expansion projects.

There’s more. To sustain the 18% growth in the civil aviation sector, the government is planning to redevelop 45 big and small airports around the country. Foreign equity of up to 100% has been permitted through automatic approvals for greenfield airports. The recently-cleared Greater Noida airport near New Delhi will involve the acquisition of 1,500 hectares of farmland. Reliance Industries Limited (RIL) and the Haryana state government have jointly proposed a greenfield international-airport-cum-cargo-airport at Jhajjar, near Gurgaon, for which 4,347 hectares have been earmarked. If similar demands to build new airports come up from 20 cities or SEZs, 50,000-80,000 hectares of farmland would disappear.

When the State itself goes about brazenly acquiring agricultural land and violating the principles of the National Land Use Policy Outline, can the private sector be far behind? In fact, the area being parcelled off for private sector projects is way higher that what is actually required. Take the Anil Dhirubhai Ambani group’s proposed gas-based power-generation project coming up at Dadri, Uttar Pradesh. The project proposes to generate 3,600 MW of power for which the state government acquired 903 hectares of prime farmland. Not only were farmers paid 125 times less than the prevailing market rate, the land acquired is 10 times more than what is required for the project.

It is obvious that this trend of acquiring or buying more agricultural land than is required is fuelling real estate speculation. The real estate sector is flourishing at 35%-38% annually. In 2006, seven of the 10 companies that yielded the best returns for shareholders were in the real estate business or have land banks. Take the case of DLF, which has a land bank of over 4,100 hectares. While some of this land is in urban areas, a majority has been bought in peri-urban areas from farmers over the last decade. Another real estate major, UNITECH, controls land in excess of 5,600 hectares. Financial company Indiabulls owns 3,000 hectares more.

Industry estimates suggest that the Hiranandani group has 1,600-2,000 hectares across the country, while prominent developers in Bangalore together control 800-1,200 hectares. The Sahara group owns 7,600 hectares, of which 3,200 hectares are held by the Amby Valley project in Maharashtra. Emaar-MGF, a foreign-held real estate company, has disclosed that it controls 4,000 hectares of agricultural land across the country.

Nandi Infrastructure Corridor Enterprises, a 75% subsidiary of BF Utilities, is developing 8,000 hectares of land that it owns along the existing Bangalore-Mysore highway. Meanwhile, the Karnataka state government has entrusted the Bangalore Metropolitan Regional Development Authority (BMRDA) with the task of acquiring land for the construction of five townships around Bangalore in October 2006. This will involve the acquisition of 24,000 hectares of agricultural land.

The Haryana government has adopted a report submitted by the consultancy firm Scot Wilson which proposes to set up 14 new townships in its National Capital Region, stretching from Sonepat in the north to Mewat in the south. Theme-based cities will come up at these locations and will be connected by a 135 km-long expressway developed on 620 hectares. About 45,000 hectares will be developed by private and state-run agencies as residential sectors and industrial zones. Every single square inch of the land is (or was until recently) farmland.

Add to this the 2 lakh acres that the ministry of commerce intends to develop as Special Economic Zones, and the figure swells.

This brings us back to the crucial question which the government refuses to answer honestly: how much crop land is being diverted for non-agricultural use? Nobody has an accurate figure. The above account summarises some of the documented facts and figures which may be a small percentage of the actual diversion of agricultural land on the ground. In such a scenario, is it not the responsibility of the government to make itself fully aware of the scale of diversion and to be clear at what threshold level the cost of diversion begins to exceed the economic gains?

This exercise could begin with a few additional questions: how much agricultural land is being converted to construct houses and shops in rural areas; how much crop land has been lost for the 4,600 big dams in the country; how much crop land is being brought under jatropha; how many million hectares are being diversified from food crops to non-food cash crops (floriculture alone covers 1.2 lakh hectares), brick kilns, stone crushers, etc. While no reliable estimates are available, going by the developments in recent years it is certainly a number of times more than the official figure of 21 lakh hectares of net sown area lost between 1990 and 2003. Maybe the human element has been overshadowed by the promises of economic benefit to a few.

When numbers do matter

Does such large-scale diversion of agricultural land have an implication on the nation’s food security? After all, India has more than a billion mouths to feed. Besides, the country also houses half the world’s hungry.

For the sake of argument, if we accept that 21 lakh hectares of crop land have been diverted for non-agricultural use, and if this area were brought under wheat, it would amount to a mind-boggling 57 lakh tonnes of produce which could feed more than 4.3 crore hungry people every year. Had there been the political will to prevent this diversion, the number of hungry would have declined by over 12%. Since the area diverted is more than 21 lakh hectares, it is clear that policymakers are implementing a blueprint to put India on the path to food insecurity.

Diversion of agricultural land for industry is frequently justified by pointing towards cultivable wasteland — around 132 lakh hectares — which can be developed and put under cultivation. However, cultivable wastelands have also declined by over 18 lakh hectares between 1990 and 2004. Further, even if these wastelands are developed and made cultivable to grow food, their productivity will remain abysmally low for several years.

In addition to increased production of foodgrain to ensure food security, pulses and fats are necessary for nutrition security. Feeding half of the world’s hungry who live in India will require at least 170 lakh hectares of additional land. Self-sufficiency in pulses and edible oils will require 200 lakh hectares more. Where will this land come from? Forget agricultural land; there is not enough cultivable wasteland available to meet this requirement.

The fact is that there simply is not enough land to go around. The commerce ministry’s statement that “SEZs account for 0.000012% of the country’s arable area” ignores the fact that this land can feed over 4 million hungry every year in perpetuity. Further, the ministry’s argument that most land under SEZs had already been acquired by state governments, and very little crop land is being acquired, is indefensible because prior to its acquisition the land would have been under cultivation.

In addition to land, water is another resource that is limited in supply and there is intense competition between agriculture and industry for its use. As it is, barely 40% of the country’s cultivated area is irrigated. This limited area, however, accounts for more than half of the total value of Indian agricultural output. Irrigation also has the potential to increase crop yields by 30% and therefore its importance in ensuring food security cannot be ignored. However, as with land, industries are being favoured for the use of water.

Given the present rules governing groundwater resources in the country, there is precious little that a state can do to prevent industries from running the underground aquifers dry and leaving nothing for surrounding farmlands. Not only groundwater, even rivers and reservoirs meant for irrigation are now at the service of industries. Take, for instance, the Whitefield Paper Mills SEZ in Andhra Pradesh. Located within 5 km of the Godavari river, the state government has permitted the SEZ to draw 100 million litres of water per day.

In Orissa, the allocation of water to industries from the Hirakud reservoir has risen 30 times over 1997 levels. Notwithstanding protests by farmers against the diversion of water meant for irrigation, the state is going ahead with its plans to increase allocation for industries like Hindalco in Sambalpur and Vedanta Industries Ltd in Jharsuguda. POSCO’s proposed SEZ in Jagatsinghpur has been allowed to directly draw water from the Mahanadi river.

The Mundra Port SEZ being developed by the Adani group in Gujarat has managed to access 6 million litres per day of Narmada water for immediate use; it expects the allotment to go up. The SIPCOT SEZ in Sriperumbudur, Tamil Nadu, will receive water from the SIPCOT water supply scheme. The government of Andhra Pradesh will install a pipeline capable of carrying a dedicated capacity of 20 million gallons of water per day for the FAB City SEZ coming up near Hyderabad. The list is endless…

It is unfortunate that despite over 177 lakh hectares of barren and uncultivable land lying unused, scarce resources like rich agricultural land and water are being poached to promote industrialisation. Instead of self-reliance, the focus has now irreversibly shifted to importing food to feed the country’s burgeoning population.

However, there are some who believe that there may be a few pitfalls in this approach.

“It’s important for our nation to be able to grow foodstuffs to feed our people. Can you imagine a country that was unable to grow enough food to feed the people? It would be a nation that would be subject to international pressure. It would be a nation at risk. And so when we’re talking about American agriculture, we’re really talking about a national security issue.”

That was President George W Bush addressing the National Future Farmers of America Organisation, on July 27, 2001. For once, Bush makes sense.

India desperately needs an Agriculture Land Conservation Act to protect its farmers and farmlands. The threat to the nation’s food security, and, consequently, to its political sovereignty is real.


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