Amid protests over land acquisition bill, Finance Minister Arun Jaitley has said that the BJP-led government is trying to “radically alter” the 2013 Land Act to ensure developmental activities especially in rural areas.
“That is a very challenging piece of legislation for any government to alter. Ostensibly the popular view is you don’t allow any land to be acquired,” he said while addressing students and faculty at Columbia University on Monday.
“This is the difficulty of passing these laws immediately on the eve of election because you come out with a highly impractical idea which is very difficult for anybody to oppose on the eve of election and then you rush through with it,” said Jaitley.
He said every state government, irrespective of political party, is now saying that for it any form of developmental activity in a country which is still developing, has come to an end.
He said land is required for rural roads, irrigation, and electrification, affordable housing for the poor and defence projects but under the current provisions of the law, land cannot be acquired until several conditions are satisfied.
“Entire activity in this area has stopped completely. (One) can’t get land for any defence projects. That is one of the most challenging things. How do you not dilute the compensation mechanism but some of the procedures with regard to national security, rural infrastructure, affordable housing will have to be relaxed? That is the challenge which we are currently facing and we will see how we go through with this challenge of Parliament,” he said.
The minister acknowledged that “certainly land becomes a slow bill” and to ensure that it is passed, the government will have to try “every political methodology” including persuading the opposition and correcting public opinion.
Jaitley, who presented the BJP-led government’s first full budget on February 28, said the “big idea behind this budget is preparing a particular constraint.”
The minister said he has mooted the idea that there needs to be an India where projects are started without taking innumerable prior approvals but by just going through a regulatory mechanism and following the guidelines.
“The broad approach for the weaker sections (is) a social security mechanism, for the middle classes a little more money in their pockets and all steps to be taken to ease business and make India more investment friendly. That is the broad approach which we have followed,” he said.
Jaitley talking about budget said he was persuaded to bring about some of the radical changes in the budget, like bringing down the rate of corporate tax in India, was that global and domestic investors told him that they don’t trust the Indian tax system, they have to run to “40 offices” before they can start productivity and that India’s taxation rate is not comparative to those of Hong Kong, Singapore and the ASEAN nations.
“These are the areas we have gone seriously wrong,” he said, adding that is why it was not difficult for the new government to take the initial few steps.
“The first obvious steps were to decide to open out in areas where we were still a closed economy. So we decided to open out in terms of our insurance, defence, real estate, medical devices and railway infrastructure. Today there is very little left in terms of opening up. So theoretically, the policy is almost as wide as it can be,” he said, adding that opening up the sectors were not very difficult decisions.