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| Some experts feel India's fresh land reforms may affect the real-estate sector's growth |
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India's
upper house of parliament has approved a new land acquisition bill that aims to
ensure industrialists pay fair compensation to farmers.
The bill
says companies will have to obtain the consent of 80% of people living on the
land before acquiring it.
People will
also have to be paid up to four times the market value for land acquired in
rural areas and two times the market value in urban areas.
Industrialists
have raised concerns over the bill's impact on the economy.
They say
that it will push up the cost of acquiring land and make projects unviable.
In July the
world's largest steel company, ArcelorMittal, and South Korean firm Posco
separately abandoned plans to build steel plants in India because of problems
acquiring land.
The new
bill also says that before any land is acquired for industry, a report
assessing the "social impact" of the acquisition of the land on its
residents must be prepared in consultation with village councils and residents'
associations.
Rural
Development Minister Jairam Ramesh has told parliament there will be no
forcible acquisition of land by the government under the new law.
The bill,
which will replace over a century-old law, will now go back to the lower house
of parliament for approval of some amendments. It will then go to President
Pranab Mukherjee for approval to become law.
In a
separate development, parliament also approved a law to allow foreign
investments in pensions, in a move to boost a slowing economy.
The lower
house has approved the Pension Fund Regulatory and Development Authority Bill,
which will allow foreign companies to buy up to 26% in companies selling
pensions.
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