Can Amaravati set land pooling example for a city built from scratch?

Gone are the stormy days of bifurcation of the erstwhile state of Andhra Pradesh and the bitter battles over the city of Hyderabad. Today, as Telangana is governed from its centre of power in Hyderabad, neighbouring Andhra waits eagerly for the completion of its planned seat of administration, Amaravati.

In the government’s own words, Amaravati, “the People’s capital of Andhra Pradesh, is envisioned to be a city of world-class standards” and one that will provide “cutting-edge infrastructure, comfortable livelihood and immense prosperity”.

However, most remarkable about this planned city, being developed from scratch, is the way it has been built on land pooled as a common, shared resource — a model that could potentially become an ideal in a country grappling with the demands of urbanization on the one hand, and concerns over land acquisition and fair compensation on the other.

Pooling vs acquisition

Amaravati as it exists today is a result of 33,000 acres of land ‘pooled’ in by the state government from individual farmers from Vijayawada and Thullur along the banks of the Krishna river. The city is being hailed as a ground-breaking experiment in land acquisition that can prove to be mutually beneficial to both the state and the farmers.

The system is unique in its functioning in that it takes stock of interest of all the various stakeholders involved. Under this system, the preexisting land owners or occupants of the land voluntarily handover and sign ownership rights over to the government agency managing land transfers in that area.

The agency’s job then is to build roads and lay sewage lines and provide residents with electricity connections. Once that is done, the agency returns a smaller, predetermined portion of the now developed area to the original occupants.

Land owners primarily stand to benefit from this scheme on two premises: first, the area once developed will have better amenities to improve the standard of living of its residents; secondly, on account of these amenities, the price of the land would rise to match the market value of the owner’s original holding.

Land pooling thus changes the medium of exchange, making land, and not money, the primary medium. In cases of land acquisition, authorities would normally compensate the land owners by paying three or four times the registered value of the land and not its market value. This has in the past made acquiring land from plot owners very difficult. The difference between the two sums would be huge in most cases, and thus the land owners would not get a fair deal, leading to controversy and conflict. The model of pooling land clearly preempts that.

Land pooling: A win-win for all?

The results of land pooling in Amaravati are yet to be gauged with certainty. However, several positive developments have been promised to the people, such as the provision of old age homes, canteens for the poor (named after Nandamuri Taraka Ramarao, founder of Telugu Desam Party), a pension of 2,500 per month to landless families and tenant farmers for 10 years, free education, free healthcare, round-the-year implementation of the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) for agricultural labour, and skill development centers for unemployed youth, to name a few.

Political experts say that one of the things that has ensured smooth acquisition under the pooling scheme is Chandrababu Naidu’s political ingenuity in terms of choosing the area wisely for building the capital city. The centre has also approved of the scheme as it does not require the usage of the land acquisition act that has often attracted scrutiny and criticism over the compensation clauses. The owners, who have given up their land for the development of this ‘green-field’ city, have been exempted from the capital gains tax generally levied on such transfer of land.

Other land-pooling experiments

While the opposition to land pooling continues, it must be noted that Amaravati is not the first city to adopt this system in India. Several states in India have adopted land pooling methods for different types of projects over the years.

Thus on the face of it, land pooling seems to offer an effective solution to finding an acceptable strategy of urban development that does not separate people from their place of residence using force and in fact, allows them to enjoy the fruits of development of the acquired land. Whether it can emerge as an ideal, truly equitable model is something that only time will tell.

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