Counter
Currents: National: Wednesday, 06 May 2015.
A new RTI
reply from the Government of India has revealed that only only 8% (66 nos.) of
the 804 projects are said to have stalled due to land acquisition problems.
Several
spokespersons for the government and the political parties which support it
have repeatedly said that the amendments to the Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and Resettlement Act (LARR
Act) enacted by Parliament in 2013, first promulgated as an Ordinance and then
repromulgated because they could not get the approval of Parliament last month,
are necessary to arrest the slowing down of the economy and breathing life into
the stalled development projects. The mainstay of this argument has been that
the process of acquiring privately owned land for developmental projects laid
down in the LARR Act is too cumbersome and requires simplification.
The state of
the economy reported in Parliament by the Government in the form of the
Economic Survey 2014-15 (ES14-15), a day before tabling the budget in February
2015 pointed out that the stalling of a large number of projects in the public
and the private sector was the primary reason for the slowdown that the Indian
economy was experiencing. However detailed data on such projects was not
annexed to that report. Official spokespersons repeatedly argued that the
amendments to the land acquisition law were necessary to pull up the economy
out of the nadir it had reached. After reading ES 14-15, I sought granular data
from the Ministry of Finance (Fin Min) under The Right to Information Act, 2005
(RTI Act) out of sheer curiosity. Fin Min, moved with exceptional speed and
provided a list of projects within less than a month of receiving the RI
application and surprisingly without demanding any additional fee.
Major
findings from an analysis of the data about stalled projects obtained through
RTI
1)
The list supplied by Fin Min contains a total of 804
projects that have stalled as of February 2015 for a variety of reasons across
24 States and two Union Territories. Maharashtra with 125 stalled projects
topped the list followed by Gujarat (63 projects), West Bengal (55 projects),
Karnataka (52 projects) and Telangana (52) making the rest of the top 5.
2)
The private sector projects (78%) outnumber the public
sector projects planned by the Central or State Governments, or public sector
enterprises or local municipal boards and autonomous authorities (22%).
3)
Only 8% (66 nos.) of the 804 projects are said to have
stalled due to land acquisition problems. If the data provided under the RTI
Act is an accurate reflection of the state of affairs, the argument that the
slowdown in the economy is due to land acquisition projects becomes a busted
myth- not on the basis if any biased analysis- but s simple count of the
reasons provided in the last column of the attached list.
4)
Of the 66 projects stalled due to land acquisition
issues, only 11 (1.36% of 804 projects) directly relate to the well being of
the disadvantaged or less affluent segments of society such as slum
rehabilitation projects or construction of budget housing projects or a bus
stand (which few affluent people use). So the proposal to amend the LARR Act to
waive the requirement for taking consent of the village assembly in the areas
where land is to be acquired for providing affordable housing for the poor will
affect a miniscule number of projects. Therefore the justification tomtomed for
the amendment becomes untenable.
5)
Ironically on the other hand, at least 145 of the stalled
projects (18%) are for the affluent and the rich as they are projects involving
the construction of shopping malls or elite hotels and resorts (4 and 5 star),
multiplexes, elite residences and villas, golf courses and a racing track.
Another 25 stalled projects are about setting up townships- nothing in the list
provided by Fin Min indicates which segment of society they are intended to
benefit. 10 of the 66 projects stalled due to land acquisition problems are in
this elite category. However, it must also be said that the list of 804
projects also includes power generation, airport construction or expansion,
road and railway expansion, pharmaceutical, textile, software and SEZ projects
amongst others. Mining projects for coal and uranium amongst other metals are
also part of the stalled projects list.
6)
Of the total of 804 projects the list mentions
"Others" as the reason for the stalling of 19% of the projects (153
nos.) Reasons for stalling are simply not available for 15% of the projects
(121 nos.) Taken together the projects for which reasons for stalling are
either unspecified or simply not available amount to more than a third of the
total number of projects (34%).
7)
The largest proportion of projects that have stalled
(38.8%) are due to unfavourable market conditions or lack of funds or promoter
interest or raw material or fuel supply problems. Several of these projects are
owned or promoted by some of the biggest industrial houses in India and a
handful of foreign ownership. If readers are interested they may compare this
list of Indian business houses with the list of corporates that made large
sized donations to the leading national and State level political parties on
the Political Party Watch segment of the website of the Association for
Democratic Reforms (ADR):
http://adrindia.org/research-and-report/political-party-watch
8)
Lack of environmental clearances account for a mere 4.2%
of the stalled projects whereas lack of clearance from the State Governments
amount to 11.8% of the total. It looks like the regulatory regimes have
contributed to only 16% of the staled projects. So the -license-inspector raj also
does not appear to be a major contributor to the stalling of the 804 projects,
if the dataset is accurate.
So it is
neither land nor the regulatory regime that appears to have contributed to the
stalling of the developmental projects. One is reminded of the slogan that
characterised the Presidential campaign of Mr. Bill Clinton in the USA during
the 1990s- "Its the economy, stupid".
Some hard
questions to which the RTI document does not provide answers
1)
For how long have these 804 projects remained in stalled
condition? The RTI reply does not throw any light on this issue. Perhaps RTI
users in the States might like to seek this information by demanding this
information from the State and Central Governments through RTI applications.
2)
Are there only 804 projects across the country that have
stalled and none other or is this only a sample of a larger universe of stalled
projects?
3)
Of the 804 stalled projects the total monetary value of
just 300 projects (37%) is said to be Rs. 18.13 lakh crores (USD 287.42 billion
where 1USD=INR 63.07) when they were reviewed yesterday at a meeting held by
the Finance Ministry (See: http://economictimes.indiatimes.com/news/economy/finance/finance-ministry-discusses-85-large-projects-npas-with-rbi-banks/articleshow/47083242.cms).
What is the total value of all 804 projects? The RTI data does not mention
monetary value against all projects.
4)
The data that the Finance Ministry provided under the RTI
Act does not appear to be data that it has generated itself. The ES 14-15
clearly states that the figures are based on inputs provided by the Centre for
Monitoring Indian Economy Ltd. (CMIE). CMIE is a private sector business
information company. What measures were taken to cross-check the veracity of
the database that they provided the Ministry before it was inserted in the
Economic Survey? Or is the database itself created on the basis of information gleaned
from government records? Most importantly, if more than a third of the projects
have stalled for reasons unspecified or unknown how can such incomplete data be
used for reporting on the state of the economy to Parliament without making the
effort to verify the claims contained in the database?
Ideally, the
Government should have volunteered this information under Section 4 of the RTI
Act in order to inform the citizens of India about the nature and magnitude of
the problem. Fin Min earmarked the RTI reply - "for RTI purpose"
while sending it to me. I am circulating this data and analysis so that readers
may form their own conclusions by analysing the data and influence their
elected representatives to debate the need for the amendments to LARR Act, in
an informed manner.
Venkatesh
Nayak RTI activist, New Delhi
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