India Inc calls for land-use reform

India Inc calls for land-use reform
The Financial Express, December 22, 2009, Page 1

fe Bureau, Mumbai

In the Indian reform story, policies on land have been the least reformed, said Ratan Tata on Monday. The chairman of the Tata group, whose company Tata Motors had to shift the production base for its Nano small car from Singur in West Bengal to Sanand in Gujarat following crippling protests over land acquisition for the project, said political leaders must strike a balance in deciding whether land is needed for agriculture or for industry.

Speaking at the TiE Entrepreneurial Summit 2009, Tata said, “Land is a hot issue and it is going to impact projects.” Tata Motors had already pumped Rs 1,500 crore into the Singur facility and many of its vendors had set up base there before the project site was abandoned.

“More often than not, conflicts related to land are promoted by individuals who do not belong to that area, but who have other political motives. Leaders need to define and reconcile between cultivated land and industrial land, because agriculture also needs to be efficient. There should be no long-term detriment to the land owner,” he added.

Tata was participating in the inaugural session of the TiE Summit, along with Infosys Technologies chairman & chief mentor NR Narayana Murthy. Moderator for the session, Indian Express Group editor-in chief Shekhar Gupta, posed to them the question, whether land was the least reformed sector in India.

Agreeing with him, Tata said land reforms would create more jobs and take India to the next level of growth. “Given that India wants to create job opportunities for not-so-educated people, it has to be in the non-technology sectors like manufacturing, where we need a lot of land,” he said.

Murthy, in turn, also stressed the need for more land to do business in the country. In urban areas for instance, Murthy said, "India needs to improve its floor-area ratio from the current 1:1 to 1:15.”

Defining the Singur experience as sad and inevitable, Tata said, “A lot of infrastructure projects are impacted due to the conflict of personal interests. Industry faces several issues on land, and these come from individuals who are politically inclined and they exploit the situation.”

Tata also said bureaucratic hurdles emerge in such circumstances. “A misinterpretation of the businessmen’s motives by people with ulterior motives can bring out a defensive attitude from the bureaucrats.”

Quoting examples from developed countries, Tata said it's easier to bring about an agreement between businessmen on a common platform in other locations. However, in India, it continues to be a challenge. “Infrastructure is a good example where we have seen countries that were way behind us (move ahead) as their infrastructure is in place.”