The Land Acquisition, Rehabilitation and Resettlement Bill, 2012, will be beneficial to land owners, but impact real estate and infrastructure, according to Mayank Saksena, Managing Director - Land Services, Jones Lang LaSalle India.
The scope of minimum required approval has been increased to 80 per cent of the affected families. This consent is mandatory only for private enterprises. The Government's role in land acquisition has been curtailed.
The Bill provides for different techniques for arriving at the compensation to be paid. With the intention of providing land owners compensation that is closer to the existing market rates, the Bill stipulates that local circle rates will now need to be doubled and further multiplied by a factor of two when it comes to land parcels in rural areas.
This means that the acquisition price for land in rural areas will effectively be four times that of the local circle rates. In urban areas, the circle rates will need to be doubled in order to arrive at the acquisition price.
The Bill is expected to affect in a big way the development of large infrastructure development projects, industrial projects and integrated township projects if they are brought under the ambit of this law, according to Sanjay Dutt, Executive Managing Director of South Asia, Cushman & Wakefield.
While the objective is to ensure that people losing land should be adequately compensated, this will assure acquirers of the land of the acquisition process and thereby rule out problems of unwarranted claims and issues of inadequate compensation.
The provisions of the Bill will be applicable in cases of land acquisition of 50 acres in urban areas or 100 acres in rural areas. The compensation for land acquisition will now be at least double in urban areas and will go up by four times in rural areas, according to the new guidelines.
Infrastructure projects will receive the sharpest blow. In many instances, this rise in input costs is likely to render the projects unviable. As it is, infrastructure projects are under pressure, especially those in the rural areas, as it is difficult to monetise them.
The cost of land acquisition will increase across the board and real estate developers intend to pass this increase in input cost on to the buyers.
So certain sections of the industry feel that an increase in property prices will negatively affect the ordinary buyers.
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