File photo of Prime Minister Narendra Modi
The Congress has demanded that the Narendra Modi government's contentious land acquisition bill provide for "four times the highest available market value in both urban and rural areas," in compensation for land acquired for projects.
This is double of what even the previous Congress-led UPA government had provisioned for in 2013, and the demand will put the BJP government in a spot. The land reforms are key to the economic agenda of the Modi government and are keenly awaited by industry. But such a substantial increase in compensation will push up project costs.
In a letter to a joint committee of Parliament reviewing the bill, Congress lawmakers alleged that the system of allowing states to fix their own formula for compensation has resulted in it being "subverted to pay compensation lower than what was intended by the legislature."
"Experience with the implementation of the law in the past year has shown this system is likely to be manipulated by unscrupulous state agencies. We therefore feel that the legislature should go one step further and make the compensation a uniform four times the highest available market value in both urban and rural areas," they have said.
The government is already struggling to push the bill through Parliament despite several amendments, with the Congress-led opposition blocking it in the Rajya Sabha or Upper House where the government is in a minority. The Opposition parties say the bill "anti-farmer" and pro-corporates," and have had the government politically on the back foot defending its proposed land reforms.
In such, it will find it difficult to oppose the Congress on its demand.
It also now has to factor in a delay that could mean the bill will miss the monsoon session of Parliament beginning on July 21. The joint committee is expected to begin studying the bill clause-by-clause only later this month. It had sought and got an extension of one week till July 28, the first day of the second week of the session, but sources said it is unlikely to complete its report by then.