Govt. Turns Land Traders, Land Mafia Prospers
The SEZ/land acquisition story is not news to anyone anymore. Briefly, Govt. acquires land through a law in force and then re-sells it to the industry or creates townships.
In search of land for my own project, I have first hand experience of the mess the govt. has created and how its minting money. Land is acquired at dirt cheap prices from farmers who have no idea how much to sell their land for. Their is no negotiation with the farmers and the acquisition price is just announced, in fact the law states that consent from the acquirees is not required. As soon as the land is acquired for industry or township, the surrounding land becomes prime property. Land brokers cheat farmers by buying this land at slightly higher prices than the acquired land. In fact, they dont even pay the full amount but a margin money to lock in the land which they later list in the market. Brokers tout these lands by talking about the projects sanctioned around it, the new roads which will be built etc etc and put up a selling price which is 10x the times they bought the land from the farmer.
The farmer somewhere realizes down the line that he has fallen into the trap but there is no legal recourse as he is already bound my legal agreements with the broker. The broker also wields her muscle power, beating up any farmer who tries to raise his voice. The farmer tries to remain content with the sudden windfall of cash, it is anyway more that ever he had dreamed off !The small size of the land holdings makes it even tougher. To buy an acre, u probably might have to have the signatures of 20 farmers! Litigation after the purchase remains a risk as u never know which relative may file a suit against u alleging denial of share as land titles are not clear.
The Govt. doesnt make it any easier. Acquired land maps are hard to get, u need to bribe for it. On top of that, they retain the right to acquire additional land if required. So u many cross all the hurdles to buy a tract at say Rs. 3 crores an acre and then suddenly the Govt. will come in saying, "hey! I require ure land for a bus depot we didnt factor in earlier ... heres ure Rs. 30lakh cheque" ... U are so screwed !!
Acquired land is of course put for sale, maybe at 3-5x the price govt. acquired it for. Getting an allotment is a nightmare. U need to grease everywhere, the bribes equal the official price of the land ! There is just no transparency !
When UN ranks India 134th out of 175 countries in its report "Doing Business Report 2007" ... its not kidding anyone ...
Category Global Ranking (out of 175)
Ease of doing business 134
Starting a business 88
Dealing with licenses 155
Employing workers 112
Registering property 110
Getting credit 65
Protecting investors 33
Paying taxes 158
Trading across borders 139
Enforcing contracts 173
Closing a business 133
(Source: Doing Business Report 2007: India Highlights)
Acquired Land, Rajarhat/New Town, Kolkata, West Bengal
In search of land for my own project, I have first hand experience of the mess the govt. has created and how its minting money. Land is acquired at dirt cheap prices from farmers who have no idea how much to sell their land for. Their is no negotiation with the farmers and the acquisition price is just announced, in fact the law states that consent from the acquirees is not required. As soon as the land is acquired for industry or township, the surrounding land becomes prime property. Land brokers cheat farmers by buying this land at slightly higher prices than the acquired land. In fact, they dont even pay the full amount but a margin money to lock in the land which they later list in the market. Brokers tout these lands by talking about the projects sanctioned around it, the new roads which will be built etc etc and put up a selling price which is 10x the times they bought the land from the farmer.
The farmer somewhere realizes down the line that he has fallen into the trap but there is no legal recourse as he is already bound my legal agreements with the broker. The broker also wields her muscle power, beating up any farmer who tries to raise his voice. The farmer tries to remain content with the sudden windfall of cash, it is anyway more that ever he had dreamed off !The small size of the land holdings makes it even tougher. To buy an acre, u probably might have to have the signatures of 20 farmers! Litigation after the purchase remains a risk as u never know which relative may file a suit against u alleging denial of share as land titles are not clear.
The Govt. doesnt make it any easier. Acquired land maps are hard to get, u need to bribe for it. On top of that, they retain the right to acquire additional land if required. So u many cross all the hurdles to buy a tract at say Rs. 3 crores an acre and then suddenly the Govt. will come in saying, "hey! I require ure land for a bus depot we didnt factor in earlier ... heres ure Rs. 30lakh cheque" ... U are so screwed !!
Acquired land is of course put for sale, maybe at 3-5x the price govt. acquired it for. Getting an allotment is a nightmare. U need to grease everywhere, the bribes equal the official price of the land ! There is just no transparency !
When UN ranks India 134th out of 175 countries in its report "Doing Business Report 2007" ... its not kidding anyone ...
Category Global Ranking (out of 175)
Ease of doing business 134
Starting a business 88
Dealing with licenses 155
Employing workers 112
Registering property 110
Getting credit 65
Protecting investors 33
Paying taxes 158
Trading across borders 139
Enforcing contracts 173
Closing a business 133
(Source: Doing Business Report 2007: India Highlights)
Acquired Land, Rajarhat/New Town, Kolkata, West Bengal
posted by AJ at 7:59 PM
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