Socio-Economic Study of Farmers Whose Lands Were Acquired Or Sold for Non-Agricultural Uses
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SOCIO-ECONOMIC STUDY OF FARMERS WHOSE LANDS WERE ACQUIRED OR SOLD FOR NON-AGRICULTURAL USES H.S. Sidhu Jaskaran Singh The Punjab State Farmers Commission Government of Punjab October 2013 Foreword One of the key inputs in the economic progress of a country is the availability of basic infrastructure projects e.g. roads, schools, hospitals, airports, new residential colonies etc. but acquiring land for these infrastructural projects have emerged a major challenge. With the change in India’s economic policy in early 1990’s a greater role has been assigned to PPP projects and private players. To attract investments state governments are competing with each other in providing facilities to these private players including acquiring land for them. At times, it becomes a matter of tension between the land owners and acquiring agencies. Besides government, some corporate entities are also buying land directly from farmers for industrial and housing projects. As a result, vast tracts of fertile agricultural land are going from under agriculture to non-agricultural uses. In Punjab nearly ten thousand hectares of agricultural land is goining under non-agricultural uses every year since 2001. The Punjab State Farmers Commission is obviously concerned about the fate of these affected farmers whose lands are being acquired /sold for non- agricultural uses. No information is available about them regarding their present socio-economic condition or whether they have been able to buy any alternative land or how they have utilized the money received as compensation or what is their present condition in terms of assets and incomes etc. How far these affected families have been able to rehabilitate and resettle themselves with the money received as compensation? How sudden influx of large cash and displacement from land may have affected their children’s education? To find an answer to these questions the Punjab State Farmers Commission initiated this study. The most important conclusion that emerges from this study is that farmers from only such locations are well settled and more or less satisfied where the compensation paid was at least double or more than double the market price of land prevailing at that time. However, those who were living on the urban fringe and who sold their lands privately are now better off in almost all respects because they received the price which was four to five times more than the prevalent market price of land. The recently enacted Central Legislation on Land Acquisition does provide for a compensation which is four times the market price of land in rural areas and two times the market price of land in urban areas. But if the market price is to be determined on the basis of an average of last three years sale deeds in the area, then even the new provision will not be able to bring it to the level of double the actual market price because sale deeds are registered at circle rate of the property which is, in most cases, less than one fourth of the actual price. Thus, the study brings out the urgent need to rationalize the circle rates of property and bring them in line with the prevailing market price of land. This will not only help in arriving at the reasonable benchmark price for land acquisition but will also increase government’s revenue from stamp duty and largely eliminate the role of black money in land transactions. Besides this, the study also throws light on the present economic condition and various other aspects of the life of those affected farmers. This work was entrusted to Dr. H.S. Sidhu an eminent economist with vast experience in the state’s economic issues. The work was carried out very systematically. The selection of the sample farmers, collection of vast data, its tabulation and analysis and writing of the report is highly appreciable and commendable. Assistance provided by Mr. Jaskaran Singh, Research Associate working for this project is also appreciable. I heartily congratulate and feel grateful to Dr. Sidhu for finding time and completing this study in a short period. October 30, 2013 (Dr. G.S. Kalkat) Chairman Punjab State Farmers Commission Government of Punjab Chandigarh Acknowledgements This study was conceived, conceptualized and commissioned by The Punjab State Farmers Commission. The task of conducting this study was entrusted to me. Throughout the course of this study, Dr. G.S. Kalkat Chairman of the Commission has been a constant source of inspiration and encouragement. But for his keen interest and able guidance this study would have never taken its present shape. I am extremely grateful to Dr. Kalkat for giving me the opportunity to work with him in the Commission. I am also indebted to the Secretary PSFC Dr. B.S. Sidhu, Commissioner Agriculture, Govt. of Punjab, who despite his busy schedule took keen interest in this study and was always helpful. Whenever I was in doubt, I always turned for guidance to my senior colleagues in the Commission Dr. Karam Singh and Dr. P.S. Rangi and they were always more than willing to help me. My sincere thanks to them for their constant guidance and unstinted support. Dr. S.S. Bains and Dr. Anil Kaura Consultants in the Commission always gave me their sagacious advice when ever I solicited it. I am thankful to all my collegues in the commission for their numerous acts of kindness. In the actual conduct of this study, I received help from many friends and well wishes. I would specifically like to convey my sincere thanks to Dr. Gurmail Singh, Professor of Economics, P.U. Chandigarh, and Dr. M.S. Sarkaria, Deputy Director, SCERT, Punjab who with their vast experience of emperical research helped me right from the preparation of the questionnaire to the conduct of the field survey. Actual field survey was conducted by three teams led by Dr. Kashmir Singh of P.A.U. Ludhiana, Sh. Bhinder Singh of Mansa and Sh. Gurpreet Singh of Mohali. They worked hard and succeeded in extracting the minutest details from the respondents. Without their painstaking efforts, it would not have been possible to conduct such a large survey spread over 30 villages and 5 districts of Punjab. I take this opportunity to convey my sincere thanks to them all. My thanks are also due to my co-researcher Sh. Jaskaran Singh, Research Associate with The Punjab State Farmers Commission who not only supervised the field survey, tabulated and analyzed data but also painstakingly typed the draft of the report. Last but not the least my thanks are also due to the Administrative Staff of the Commisssion led by Sh. R.S. Tiwana, Administrative Officer and his team of dedicated workers who provided me all the facilities and required support. Needless to mention that I alone am responsible for any omissions and shortcomings that may have remained in this report for I sincerely believe that there is always a scope for doing things in a better way. (H.S Sidhu) Consultant Punjab State Farmers Commission Mohali October 30, 2013 Contents Foreword Acknowledgements Main Findings and Policy Implications Diagrammatical Representation i-vi Chapters 1-8 1 Issues in Land Acquisition Data Base of the Study and Some Characteristics’ of the Sample 2 Households 9-23 3 Utilization of Compensation Received / Funds Obtained from Sale of Land 24-32 4 Impact of Land Acquisition / Sale on Land Ownership Status of Respondent Farmers 33-53 5 Impact of Land Acquisition / Sale on Total Assets and Their Composition 54-69 6 Impact of Land Acquisition / Sale on Farmers Income 70-88 7 Respondents Farmers Living Conditions and Their Levels of Satisfaction 89-98 8 Summary and Conclusions 99-110 9 Reference 111 Main Findings and Policy Implications 1. Land acquisition is a process where government acquires private property for public purposes using the concept of ‘eminent domain’ which is the power of the State to seize private property without the owner’s consent. It has been a cause of very large number of legal conflicts in India in the recent past. Apart from land acquisition for public purposes howsoever defined by the state, private parties have also been purchasing large chunks of agricultural land for various non-agricultural uses. In Punjab during the last ten years on an average nearly 10.000 hectare of agricultural land has been going under non-agricultural uses every year and nearly 95% of that is going from under Net Area Sown. But we have no information on how the compensation received by the land ownwers was utilised or what is their present economic condition or how it has affected their children’s education etc. This study is an attemt to fill this gap. 2. The present study is based on a primary survey of 500 households spread over five districts of Punjab.. There are two sets of data . One set of data called category-I relates to 300 households whose lands were acquired during the last few years. For this we selected 75 affected families from each of the four districts- Bhatinda, Mansa, Mohali and Tarn Taran. The second set of data called category-II relates to those households who were living in villages on the outskirts of fast expanding urban centers, such as Ludhiana and Mohali and who sold their lands privately. We selected 200 households from this category- 100 households from villages around Ludhiana and 100 households from villages around Mohali. Although we have studied the socio-economic condition of farmers belonging to both the categories, however, it must be stated that strictly speaking these two categories are not comparable as respondents belonging to category-II had locational advantage, which the farmers belonging to category-I from Bhatinda, Mansa, and Tarn Taran did not have.