Petition Filed in Supreme Court Against Land Acquisition For SEZs

There has been a furor across the country about the alleged acquisition of cultivation lands for setting up Special Economic Zones. A Public Interest Litigation has been filed in the Supreme Court against acquisition of agricultural land from farmers for SEZs. In the Raigad District of Mumbai a gram Sabha attended by over a hundred people passed a resolution against the proposed SEZ for the Reliance group.

The Government of India came up with this novel idea of setting of Special Economic Zones that provide tax sops and other liberal economic incentives to enable entrepreneurs set up world class units to boost exports from such zones. "The SEZz will be the only way forward in bridging the gap between Indian and other South Asian Countries like China in terms of manufacturing" said the President of Confederation of Indian Industries, P. Seshasayee. It has other clauses such as, not more 10% of existing assets from a non-SEZ area may be moved into an SEZ. Effectively imposing the fact that, the investment and export must be "fresh" and confined within the particular SEZ alone.

Also, it is said that ideally these SEZs should not be located close to urban areas. And this is where the problem arises. Allegations go around that Governments and Corporates indulge in forcibly acquiring land - agricultural or otherwise - and provide a meager compensation to the affected persons. The Hindu quotes one,

Our lands are very costly. It is close to the Jawaharlal Nehru Port Trust which offers high prices for our land to house their containers. Why should we allow our lands to be forcibly acquired when he have a choice of buyers?

SEZs may be a much needed idea to boost economy and infrastructure in the country where growth is often hampered by embedded taxes and red tape. But the good old people who implement the idea seem to be too enthusiastic about the whole growth thing, pouncing upon any stretch of land in their sight beyond the urban limits of states. Acquiring agricultural lands in an economy dominated by agriculture in the name of boosting manufacturing may not really be the common-sense way to economic growth.

One additional risk is the danger of SEZs cannibalizing other economic projects, by acting as a magnet for funds, denuding neighboring hospitals, schools, factories, etc. by virtue of their tax-friendly status. The sheer number of SEZs proposed makes it likely that some will go bust, tying up capital for years that could have been productive elsewhere.