4:05 AM
New land acquisition law triggers demand for revision of benefit-cost ratio for projects
THE new land acquisition law. under which compensation for land to he acquired is to he paid at market rates, is making the ongoing as well as proposed projects financially 'not viable'. Considering this serious implication for a region like Vidarbha. the provisions in the law have triggered a demand for revision of benefit-cost ratio for various public projects.
Under the new law Right to Fair Compensation and Transparency in Land Acquisition. Rehabilitation and Resettlement Act. 2013. the project-affected persons or whose land is to he acquired for a particular public project are to be paid compensation that will be four times the prevalent rates in rural areas and two times in urban areas. Though the law's implementation is yet to pick up. the agencies like Public Works Department (PWD). Water Resources Department (WRD) etc have started studying the provisions of the law.
In case of Vidarbha, at least the above-mentioned two departments are already facing problems of project viability as they have to take care of payment of net present value (NPV) if forest land is being acquired for a project. In such condition, the provisions for increased compensation in the new land acquisition law may spell doom for projects in the region as many of those would become 'unviable'.
Under the new law Right to Fair Compensation and Transparency in Land Acquisition. Rehabilitation and Resettlement Act. 2013. the project-affected persons or whose land is to he acquired for a particular public project are to be paid compensation that will be four times the prevalent rates in rural areas and two times in urban areas. Though the law's implementation is yet to pick up. the agencies like Public Works Department (PWD). Water Resources Department (WRD) etc have started studying the provisions of the law.
In case of Vidarbha, at least the above-mentioned two departments are already facing problems of project viability as they have to take care of payment of net present value (NPV) if forest land is being acquired for a project. In such condition, the provisions for increased compensation in the new land acquisition law may spell doom for projects in the region as many of those would become 'unviable'.
In fact, sources in the Government said dial acquisition of land for public projects may become almost impossible in near future.This will affect the development of specially the underdeveloped regions like Vidarbha. In case of irrigation projects only, the viability factor comprises cost of payment of NPV and compensator afforestation for forest land, catchment area development plan etc.
Against this backdrop, a high-level meeting w;in held recently at Delhi. The representatives from all the States across the country were asked to give their opinions on the provisions of the new law. There, sources said, representatives of almost all the slates including the ones from Maharashtra pressed for revision of benefit-cost ratio 10 make projects viable. The benefit-cost ratio is the ratio of benefit derived against cost of a project. For instance, in case of irrigation projects, it is I for drought-prone areas and 1.5 for other areas. This means, if Re I is spent as cost
Posted in: News 2014
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