After laying the foundation stone for Amaravati — the new capital of Andhra Pradesh — Prime Minister Narendra Modi anointed it as the
“people’s capital.” And although he did not say why he chose that particular description, he did emphasise that the people of Andhra Pradesh
are in the best position to make Amaravati a shining example, showing how a modern smart city can be an engine of growth without neglecting ecological sustainability.
There is another reason why Amaravati is already a “people’s capital”. It has to do with how the N. Chandrababu Naidu government convinced thousands of local villagers to part with their predominantly agricultural land to make way for a whole new city.
The contrast with Modi’s repeated failed attempts at passing a new land acquisition law could not be sharper. Naidu’s effort should be welcomed as it offers an alternative to the coercive model that the Centre’s land acquisition ordinance was seeking to push. Instead of opting to remove consent requirements, Naidu has shown a way by which land can be acquired, making farmers partners in development, which usually benefits everyone else.
In this regard, it is worth understanding the merits of the unique “pooling” model for land acquisition that Naidu has adopted. Instead of a one-off deal, he has opted to give back to the farmers about 30 per cent of the developed land. It is obviously hoped that the price of the developed land would compensate for the loss of ownership. So for every acre or 4,840 square yards that a farmer gives, he will get a developed residential plot of 1,250 square yards and a commercial plot of another 200 square yards. But the offer does not end there.
Farmers will also receive Rs 50,000 per acre per year for 10 years for parting with their land. This, more or less, covers the annual income from cultivation, which they have foregone. This has proved to be not only a good deal but also a fair one for the farmer. After all, the value of his land is simply not equal to the value of the paddy or groundnut that it will produce in 10 years. The real value is arrived at when there is a change of land use from agricultural to industrial or commercial, and under Naidu’s model, the farmer is entitled to some of the gain.
Time and again, the PM has underscored the centrality of easing the process of land acquisition for India’s economic growth. It is time to reorient the approach towards farmers and landowners and make the process more participative.