Punjab sets high price for its land

The Aerocity Township coming up near the airport,too,fetched Rs 1.5 crore an acre for farmers in April this year. Punjab is now all set to offer an equally hefty compensation to farmers for the upcoming Urban Estate in the scenic vicinity of Chandigarh at Mullanpur.

“The land compensation for the 444 acres to be acquired by the Greater Mohali Area Development Authority (GMADA) at Mullanpur will be Rs 1.5 crore per acre for farms near the highway and 1.25 crore for those seven or more kilometres away,” said Secretary,Housing and Urban Development,S S Sandhu. The final compensation will be announced after the meeting of the price fixation committee headed by the Mohali deputy commissioner.

And it is not just the high-potential areas in Chandigarh’s vicinity that have been rewarded generously by the government. Punjab has been equally magnanimous in compensating farmers whose land do not ‘qualify’ for such a good deal. In 2009,the erstwhile Punjab State Electricity Board (PSEB),now Powercom,had objected to the “high” land compensation figure for the state’s biggest power project,the 2,640-MW plant at Gidderbaha.

“PSEB had referred back the matter of land compensation to the government,citing the rates to be on the higher side. Much of the land to be acquired was wasteland owing to waterlogging,” said a former PSEB official.

Finally,three different rates were fixed for the nearly 2,300 acres that were to be acquired from two villages. “Though the 2008 land acquisition proceedings for the power plant have now lapsed and will have to be initiated afresh,the rate of the best land was finalised at Rs 28 lakh an acre,including 30 per cent solatium and 10 per cent no-litigation premium. For the second best land,the price was worked out to be Rs 16.5 lakh an acre,plus the two allowances — Rs 23 lakh an acre — while the compensation for the waterlogged land was decided to be Rs 14 lakh an acre,plus allowances that totalled up to Rs 19.6 lakh an acre,” said Muktsar Deputy Commissioner Varun Rujam.

Our land is precious,social unrest over land acquisition can delay projects: FM
Gidderbaha is represented in the state Assembly by Punjab Finance Minister Manpreet Badal. According to Punjab’s land acquisition policy,MLAs and MPs representing the area are members of the price fixation committee. A strong votary for high compensation for farmland,Manpreet says land in Punjab is precious and there is no point holding up projects following social unrest. “We can all see what is happening against the Nagarjuna power plant in Andhra Pradesh. The people who are dislocated should feel totally satisfied. Punjab has never seen an agitation over land acquisition. Since land is not going to grow in future,at least the farmer should be able to get the best deal for what he parts with,” he adds.

As part of the liberal compensation policy,both the upcoming Central university at Bathinda and the 1,300 acres acquired for the Rajpura Mega Thermal Plant,too,saw a high compensation of Rs 35 lakh an acre,almost double of the prevailing market value,last year.

The flipside
While high land compensation is resulting in more cash-rich farmers in Punjab,the state’s land prices are proving to be a deterrent for industry. A report on the investment scene in Punjab,released by the Federation of Indian Commerce and Industry (FICCI) in 2008,cited Punjab’s soaring land prices as the biggest impediment in the way of future investments. The state’s industrial graph is already on the decline and high land prices are further eroding its industrial base,it said.

Something,Industries Minister Manoranjan Kalia says,the department is trying to deal with on priority basis. “High land prices and unavailability of land is a major roadblock in the way of Punjab’s industrialisation. Creating a land bank for attracting investment is the major focus of the state’s new industrial policy implemented in 2009. To begin with,three such multi-product industrial hubs are being developed at Ropar,Kapurthala and Mohali for information technology and manufacturing units.”

As for the farmers,the gains depend on where he is based and how he utilises that money,says Punjab Farmers Commission Chairman Dr G S Kalkat. “If the money is used by them to buy more land and invest in farm machinery,it works in the interest of the farmer as those near cities can buy more farmland in other affordable areas. For instance,many farmers displaced from Jhurheri village for the international airport have been able to buy 10 to 15 acres of land in Mansa and Bathinda districts from the compensation amount they got for their two to three acres. However,some have also indulged in unproductive expenditure such as buying expensive cars. Also,the high land compensation works against the interest of investment by industry. The only hope in this case will be if the situation helps take industry to the hinterland where land prices are not so high. This will bring equitable development as families of small farmers will also be able to diversify from agriculture to jobs in the industry sector,” he adds.

Interestingly,unlike neighbouring Haryana,where government acquisitions have been opposed by farmers and marred with litigations,Punjab has had a smooth sail so far. Also,while compensation for Haryana farmers comes in staggered annuity over 33 years,Punjab awards the entire amount,including displacement allowance and no-litigation premium,in one ago. And where there is a hint of agitation,the projects are shelved as in the case of the Mohali-Phagwara Expressway,which was abandoned last year following opposition from farmers.

Compensation for farmers
Rs 1.5 cr per acre International airport at Mohali
Rs 1.5 cr per acre Aerocity (township near the airport)
Rs 1.2-1.5 cr per acre Mullanpur Urban Estate
Rs 35 lakh an acre Rajpura thermal plant
Rs 35 lakh an acre Bathinda Central University Rs 20-28 lakh an acre
Gidderbaha thermal plant