Working Group on Land Relations

The Working Group on Land Relations for formulation of 11th Five Year Plan was set up by the Planning Commission under the Chairmanship of Shri D. Bandyopadhyay with the following composition and Terms of Reference:

1.1       Composition

  1. Shri D. Bandyopadhyay                 :          Chairperson
  2. Shri V.S Sampath                                        Member
  3. Dr. T. Haque                                     :           Member
  4. Prof. Bina Aggarwal                                    :           Member
  5. Prof. Kancha Iliah                            :           Member
  6. Shri T. R. Raghunandan                            Member
  7. Prof. R.S. Rao                                  :           Member
  8. Shri L.C. Singhi                               :           Member
  9. Shri P.V. Rajagopal                         :           Member
  10. Shri Balaji Pandey                          :           Member
  11. Smt Aditi Mehta                               :           Member
  12. Shri Aurobindo Behera                  :           Member
  13. Dr. Arvind Virmani                           :           Member
  14. Shri Rajiv Chawla                           :           Member
  15. Shri T.C. Benjamin                          :           Member
  16. Shri Sukumar Das                                      Member
  17. Shri Subhash Lomte                       :           Member
  18. Shri Lambor Rynjah                        :           Convener Member
  19. Shri D.P. Roy                                    :           Co-convener Member

1.2       Terms of Reference

1)    Modernization of land management with special reference to updating of land records, proper recording of land rights and speedy resolution of conflicts and disputes relating to land.

2)    Use of modern technological developments for on-line maintenance of land records and demarcation and digitization of land boundaries.

3)    To analyse the agrarian and related economic causes for the rural unrest prevailing in a number of states and to suggest appropriate remedial measures including the assessment of the efficacy of the current land ceiling laws and their effective implementation.

4)    To examine the issues relating to alienation of tribal lands including involuntary displacement of tribals from their habitats and livelihood for development purposes and to suggest realistic measures for restoration of such lands to them and for economically viable and culturally acceptable resettlement of project affected tribals.

5)    To examine the issue of bringing the tenancy including sub-tenancies into the open and suggest framework to enable cultivators of land to lease in and lease out with suitable assurances for fair rent, security of tenure and with right to resumption.

6)    To examine the development of Land Markets in the present context and suggest for its improvement, keeping in view the interests of small and marginal farmers.

7)    To look into the pros and cons of the economics of contract farming to protect the interests of small and marginal farmers and landless agricultural workers and to make them economically viable retaining their autonomous status as free economic agents in the present Indian context, particularly keeping in view some adverse effects noticed in some Latin American and Caribbean countries.

8)    Recommend measures to prevent sale and purchase of agricultural land for speculative and non-agricultural purposes.

9)    Suggest measures for comprehensive implementation of homestead rights.

10) Any other issue of relevance concerning the agrarian relations in India.

11) Any other Term of Reference that may be  decided by the Working  Group in its first meeting.

1.3.    Formation of Sub-Groups

The Working Group in its first meeting held on 13.4.2006 at the Planning Commission formed four Sub-Groups for in depth study of the terms of reference and preparation of report thereon.  The following Sub-Groups were constituted :

Sub-Group I

Terms of Reference

1)          Modernization of land management with special reference to updating of land records, proper recording of land records and speedy resolution of conflicts and disputes relating to land.

2)          Use of modern technological developments for on-line maintenance of land records and demarcation and digitization of land boundaries.

Composition :

i)         Shri Rajeev  Chawla, Secretary/Settlement Commissioner, Govt. of Karnataka, Convenor.

ii)        Shri T.C. Benjamin, Settlement Commissioner, Govt. of Maharashtra.

iii)       Shri Sukumar Das, Land Reforms Commissioner, Govt. of West Bengal.

Sub-Group-II

Terms of Reference

3)          To analyse the agrarian and related economic causes for the rural unrest prevailing in a number of States and to suggest appropriate remedial measures including the assessment of the efficacy of the current land ceiling laws and their effective implementation.

5)        To examine the issue of bringing the tenancy including sub-tenancies into the open and suggest framework to enable cultivators of land to lease in and lease out with suitable assurances for fair rent, security of tenure and with right to resumption.

 

Composition

(i)                  Prof. R.S. Rao, B-13, University Quarter, Centre University Post Office, University of  Hyderabad, Gachibouli, Hyderabad.

(ii)          Shri P.V. Rajagopal, Ekta Parishad, Gandhi Peace Foundation, Deen Dayal Upadhyay Marg, New Delhi.

(iii)         Shri L.C. Singhi, Professor, Centre for Rural Studies, LBSNAA, Mussorrie, Uttaranchal – Convenor

Sub-Group – III

Terms of Reference

4)           To examine the issues relating to alienation of tribal lands including involuntary displacement of tribals from their habitats and livelihood for development purposes and to suggest realistic measures for restoration of such lands to them and for economically viable and culturally acceptable resettlement of project affected traibals.

 

Composition

(i)            Shri Subhash Lomte, National Convenor, National Campaign Committee for Rural Workers, 125, Samrath Nagar, Aurangabad.

(ii)          Shri Balaji Pandey, Institute of Socio-Economic Development, 28, Dharma Vihar, Bhubaneswar.

(iii)         Shri Aurobindo Behera, Secretary (RD), Govt. of Orissa – Convenor

(iv)         Ms. Aditi Mehta, Joint Secretary, M/o Panchayati Raj,  GOI.

Sub-Group-IV

Terms of Reference

6)       To examine the development of land markets in the present context and suggest for its improvement keeping in view the interests of small and marginal farmers.

7)      To look into the pros and cons of the economics of contract farming to protect the interests of small and marginal farmers and landless agricultural workers and to make them economically viable retaining their autonomous status as free economic agents in the present Indian context, particularly keeping in view some adverse effects noticed in some Latin American and Caribbean countries.

8)    Recommend measures to prevent sale and purchase of agricultural land for speculative and non-agricultural purposes.

9)      Suggest measures for comprehensive implementation of homestead rights.

Composition

i)              Shri V.S. Sampath, DG, NIRD, Hyderabad – Convenor

ii)            Dr. T. Haque, Chairman, Commission for Agricultural Costs and Prices, Govt. of India, New Delhi.

iii)           Prof. Bina Aggarwal, Institute of Economic Growth, Delhi University, Delhi.

iv)           Shri Kancha Ilaiah, Professor of Political Science, Osmania University, Hyderabad

v)            Shri T.R. Raghunandan, Joint Secretary, M/O Panchayati Raj, GOI.

1.4       Procedure adopted for drafting the Report

The Working Group met on 13.4.2006 at the Planning Commission in Yojana Bhawan mainly to explain the terms of reference and form sub-groups to work on them.  The second meeting of the Working Group was held on 30.5.2006 during which various sub-groups presented their group reports and received suggestions and comments from all the members of the Working Group.  The third meeting of the Working Group was held on 3.7.2006 for final round of discussion on the sub-group reports.  Concluding the meeting, the Chairman, thanked all the members for their active participation & valuable contribution and formed a small group from among the members of the working Group to prepare the final document, based on reports of various sub-groups and discussions held.  The final meeting of the Working Group was held on 31.7.2006. A Sub-Committee had visited Raipur, Chhattisgarh to assess the field situation regarding  land acquisition.  It presented its report in the  meeting of the Working Group held on 31.7.2006 which was taken on record.

 

1.5       BACKGROUND

The Working Group on Land Relations for formulation of 11th Five Year Plan was set up by the Planning Commission under the Chairmanship of Shri D. Bandyopadhyay, vide order No. M-12018/1/2005-RD dated March 13, 2006, having the terms of reference and members as indicated in pages 1-2.

The Working Group met on 13.4.2006 at the Planning Commission in Yojana Bhawan mainly to explain the terms of reference and form sub-groups to work on them.  The second meeting of the Working Group was held on 30.5.2006 during which various sub-groups presented their group reports and received suggestions and comments from all the members of the Working Group.  The third meeting of the Working Group was held on 3.7.2006 in  for final round of discussion on the sub-group reports.  At the end, the Chairman, thanked all the members and formed a small group from among the members of the working Group to prepare the final document, based on reports of various sub-groups and discussions held.  The concluding meeting of the working group was held on 31.7.2006. A Sub- Committee had visited Raipur, Chhattisgarh to assess the field situation regarding land acquisition/PESA. It presented its report in the concluding meeting of the Working Group held on 31.7.2006 which was taken on record.

 

2.0       INTRODUCTION

In the wake of economic liberalization, land reform seems to have lost its flavour and favour with the government.  However, as a general proposition it may be stated that land reform should remain an essential element of national agricultural and rural development strategies not only because land based agricultural occupation must continue to provide livelihoods to a vast majority of rural population, but also because macro economic growth in most contexts has failed to create improved prospects for the rural poor to acquire assets, gain employment, or increase their income and quality of life.  While one cannot seriously challenge the above proposition, the world over the experience had been that government budgets for agriculture and rural development had been reduced, farmers’ cooperatives had disintegrated especially in Latin America, prior focus on tenancy improvements had been replaced by a focus on land markets and flexible labour conditions and land prices had escalated due to speculative activities and general pressures on land.  Under the circumstances it became extremely difficult for the rural poor to access new productive land and maintain secure tenure unless there was a significant policy shift towards comprehensive land tenure reform with the active participation of the intended beneficiaries.

Land reform can change not only the current culture of exclusion so that  the poor can gain access to land, credit, technology, markets and other productive services, but also become active partners in the development of government policies and programmes affecting their livelihood.

It would not be a cake walk.  There would be strong resistance from the vested interests particularly from the land owning classes.  The key to success would be the strong organizations of prospective beneficiaries vociferously demanding the change in their favour backed up by equally forceful political will of the state to intervene in favour of poor and the dispossessed.

Against this overall background which fully justifies land reform both on theoretical and pragmatic grounds, the Working Group on Land Relations would respond to specific issues mentioned in the Terms of Reference set by the Planning Commission.

3.0                     KEY NOTES AND RECOMMENDATIONS

3.1                   Modernization of Land Management

The primary goal in land management  in the 11th Five Year Plan should be to achieve a fairly high level of credibility in land records.  The aim should be to make land records closer to ground reality, so that it becomes a catalyst in the overall development of the nation.

3.1.1      Key Recommendations:

a)        Amend/introduce laws to facilitate the registration of deeds, through an authority called ’Land Officer’ who will substitute the ‘Registrar and the ‘Revenue Tehsildar’ or its equivalent  rank officer.

b)        Computerise all pending mutations of all existing land parcels.

c)        Update and digitize all sub-divisional (parcel) spatial data (Phalnis).  Once spatial data is digitized, it will be possible to put it on the web and be made available to whoever needs it.  Such data on web will be useful as  true copy of registration cum mutation.

d)        Revise the registration system in such a way that the land officers take primary responsibility for checking both questions of procedure and substance.  This system would include production of the sketch of the land intended to be transacted clearly demarcating the transacted extent, which could be incorporated into the cadastral map with appropriate check later.

 


3.2         Addressing the Problem of Rural Unrest through Effective Implementation of Appropriate Ceiling and Tenancy Laws

3.2.1     Ceiling Laws

Even though ceiling laws have been enacted and enforced in majority of  the  states, there are wide inter-state variations in the legal frame work as well as effectiveness of ceiling laws.  In most states, ceiling on land holding applies to owned land and land taken on lease.  However, in Orissa, Uttar Pradesh and West Bengal, ceiling applies only to owned land and not to tenanted land.  Litigation withholds a substantial part of the ceiling surplus land in almost all the states.  Also a significant portion of the area declared as ceiling surplus in many states is either unfit for cultivation or not available for distribution due to ‘miscellaneous reasons’.  Besides, a number of benami and clandestine transactions have resulted in illegal possession of significant amount of land above ceilings.  In addition, any unirrigated land becoming irrigated by private sources has not been considered for the purpose of determination of ceiling.  Thus, due to several factors, the result of implementation of ceiling laws was far from satisfactory. Both equity and efficiency demand proper implementation of ceiling laws with streamlining of various categories of land with variety of ceilings applicable to them. Securing land based livelihood to the rural poor is the best way to mitigate if not eliminate, violent rural unrests. This Group fully endorses and reiterates the statement contained in the Common Minimum Programme of the United Progressive Alliance declared on 27th May,2004 to the effect that “Landless families will be endowed with land through implementation of land ceiling and land redistribution legislation. No reversal of  ceiling legislation will be permitted”

3.2.1.1            Key Recommendations:

i)             In view of increased land productivity under the impact of new technology and improved agronomic practices, the ceiling limits should be re-fixed and implemented with retrospective effect.  The new limit should be 5 to 10 acres in the case of irrigated land and 10 to 15 acres in the case of non-irrigated land, to be decided by the concerned state governments.

ii)            Reclassification of newly irrigated areas should be undertaken with joint effort for bringing these lands within the ambit of ceiling laws.  Besides, land covered under private irrigation and supply of water from a perennial source should be included in ceiling laws.

iii)           The Benami Transactions (Prohibition of the Right to Recover Property) Act, 1989 should be suitably amended so that evasion of provisions of the ceiling law through benami land transactions can be detected, checked and nullified.

iv)           Introduce Card Indexing System for prohibiting fictitious transfers in benami names.  Recent developments in IT should be properly used to have accurate Card Indices in a speedy manner.

v)            Set up a special squad of revenue functionaries and gram sabha members for identification of benami and fictitious transaction in a time bound manner.

vi)           Remove exemption granted to religious, educational, charitable and industrial units under ceiling laws of various states.  Each entity should have the same ceiling as a family, even though state may exempt any particular category on valid grounds.

vii)         Impose criminal sanction on the failure to furnish declaration of ceiling surplus land by land holders

viii)        Insert a penal clause in the existing Land Ceiling Laws, making the officers responsible for intentional lapses if any.

ix)           Set up Land Tribunals or Fast Track Courts under Article 323-B of the constitution for expeditious disposal of appeal cases.

x)            States to empower the concerned authorities to expedite allotment of ceiling surplus land. Bar the jurisdiction of civil court in respect of ceiling on agricultural land.

xi)           Investigate all cases of illegal or improper allotments of ceiling surplus land and cancel such allotments.  All such transactions after commencement of ceiling law should be declared null and void.

xii)         Absentee landlords or non-resident land owners should have lower level of ceiling.

xiii)        For addressing problems relating to land a single window approach to be provided by the administration.

3.2.2   Amendments in Tenancy Laws

Despite ban on agricultural tenancies in most states, the incidence of a type of tenancy particularly in various forms of crop sharing is still substantial in some regions.  As tenancy is contracted orally in most cases in violation of the law, such tiller’s position remains precarious.  He has no incentive to cultivate land efficiently.  In several regions, landowners keep the land fallow for fear of losing their rights if they let out illegally.  It also restricts poor peoples’ access to land through leasing in. Currently, there is no appropriate legal system for recording of such cases of tilling arrangement.  Also there is a growing problem of reverse tenancy.

3.2.2.1        Key recommendations:

i)             While discouraging the pernicious system of rent seeking sub-infeudation, leasing in and leasing out of agricultural land particularly for the purpose of tilling should be permitted within ceiling limits.  The state laws should recognize systems of share cropping and protect the share croppers by giving security of tenure and fixation of equitable share of the crop without conferring the title to  land.

ii)            Gram panchayats/gram sabha should be empowered to update land records and enter the name of share croppers and other similar categories of tenants as tillers of land in the record of right after due enquiry.

iii)           Leased out benami land should be acquired and distributed to the landless poor for cultivation.

iv)           The marginal and small land owners should be assisted with adequate institutional support and rural development schemes so that they are not compelled to lease out land to big farmers or corporate houses, thereby creating conditions for reverse tenancy.

v)            Under-raiyats/sharecroppers should be recognized by law with sufficiently over riding evidentiary value as under section 57 of the Indian Evidence Act.

vi)           There is a need for streamlining the tenancy laws in various states, so that the small landowners who have to migrate temporarily for higher wages do not lose their right. Interest of temporary migrant workers has to be protected.

vii)         Fair share of the crop on agricultural land should be fixed in all the states.  In case of crop land, the landowner’s share should not exceed one fourth of the principal crop, if the costs are borne by the tenant and half if the costs are borne by the landowner.

viii)        Personal cultivation should be strictly defined for the purpose of resumption of land tilled by the tiller.  It should be done through due process of law.

 

3.3       Alienation of Tribal Land

In the past few years, rural unrest has increased in most tribal areas.  While displacement caused due to development projects have resulted in confrontation between authorities and local tribals, there are other factors such as growing indebtedness, forcible eviction of tribals from their land by non-tribals, conversion of land from communal ownership to individual ownership, increasing urbanization, treating tribals as encroachers in traditionally occupied forest  land and lack of substantive possession by tribals of government land allotted to them and so on.  In order to prevent further deterioration in the situation, there is an urgent need to look into the ownership of resources by tribals, especially the resources on which they depend for livelihood, such as land, forest and water.

3.3.1     Key recommendations:

(i)            At present PESA is applicable only to the scheduled areas but a large part of the tribal population lives outside scheduled areas.  Therefore, the provisions of PESA should be applicable mutatis  mutandis to villages/areas where there is a sizable tribal population/where majority of the population consists of scheduled tribes.

(ii)          It is necessary that, whenever land is acquired for industrial or mining projects, the exact extent of land required for the projects assessed by the concerned project authorities should be reassessed by a neutral agency/expert body consisting of experts, with the representatives of tribal community.

(iii)         The Central Land Acquisition Act of 1894 and the Central Coal Bearing Areas (Acquisition & Development) Act 1957 should be amended in the line of the provisions of PESA.

(iv)         The Land Acquisition Act should be amended to incorporate R&R policy for all projects.  Rehabilitation should be undertaken in such a manner that the displaced tribals have a clearly improved standard of living after resettlement.  Their ecology, culture and ethos will have to be given due consideration in the Resettlement Plan.

(v)          The tribals who are displaced, should preferably be resettled in a zone adjacent to the affected area in consonance with their social, ecological, linguistic and economic affinity.

(vi)         Resettlement and rehabilitation should be completed prior to the commencement of the project.  The package should be approved by Gram Sabha in the PESA Area and by such other representative institutions in non-PESA tribal areas.

(vii)        Unmarried daughters/sisters, physically challenged persons, orphans, widows and women divorcees should be treated as separate families in the R&R policy.

(viii)      All tribal communities must be rehabilitated strictly in compliance with ILO convention No. 107.

(ix)         Efforts should be made to ensure that all tribal families are resettled together to the extent possible.  The minimum unit for relocation must be a hamlet or clan.

(x)          Compensation should be calculated and given on the basis of calculation of a 20 year prospective income stream to the tribal families for loss of customary rights over forests.

(xi)         Shifting the cut off date beyond 1980 with regard to regularization of tribal settlements in forests and extending R&R benefits to tribal families in the event of their relocation/eviction must be undertaken.

(xii)        The Mines and Minerals (Development & Regulation) Act 1957 should be suitably modified to reflect the provisions of PESA.  In the PESA Act, the consent of the Gram Sabha should be made mandatory not only for minor minerals but also for major minerals.  In Orissa and Rajasthan, mining concession rules should be modified to reflect the provision requiring consent of the Gram Sabha/Palli Sabha.

(xiii)      Pending amendments to the Central Act on land acquisition and incorporating the provisions of PESA, the State Governments with scheduled areas should utilize the flexibility provided for in the Vth Schedule of the Constitution and modify the Land Acquisition Act to provide for consent of the Gram Sabha prior to the acquisition of land.

(xiv)      Survey and settlement operations should be taken up in those areas where it has not been done so far to remove any confusion or uncertainty.  Following the recommendation made by the Expert Group on Tribal Land Alienation, survey of the hill slopes up to 30 degrees should be mandatorily done in the States with Schedule areas and such lands should be settled in favour of tribals doing shifting cultivation and subsistence agriculture.  This will not only confer land rights on the tribals occupying such lands, but also help improve the forest cover.  The areas under shifting cultivation should be brought under tribal community management.

(xv)        All tribal states should provide a share of the royalty to the Gram Sabha, as in case of Chhattisgarh.

(xvi)      While it cannot be argued that the ‘eminent domain’ of the state should be done away with, a clearer definition and guidelines for ‘public purpose’ would help remove some of the arbitrariness present in the existing system of land acquisition.  The lack of transparency in the process of land acquisition needs to be addressed.

(xvii)     The sale of tribal land could be permitted by a competent authority senior enough to be able to exercise judgement in order to protect the interest of tribals.  The State should promote the concept of a Land Bank wherein tribal land is purchased by the State and allotted to other deserving tribal families in the same area.  Lease of Govt. land in the tribal areas by tribals for agriculture and homestead purposes should be more than proportionate to the percentage share of tribals in the population of the village.

(xviii)    The Government land encroached by poor tribal families should be settled in their  favour.

(xix)      The Common Property Resources (CPRs) including grazing land, village forest and water resources should not be acquired without providing alternative sources of equal or higher value.

3.4.        Development of Land Markets, Contract Farming and Implementation of Homestead Rights

3.4.1     Land Markets

The sale and purchase of agricultural land among cultivators constitute normal land market transactions.  Many small and marginal farmers are compelled to sell their land mainly due to two factors: (i) emergency family needs caused by illness, marriage and similar events and (ii) uneconomic holdings.  The lease market basically works through tenancy.  In the last five decades, tenancy reforms in India have gone through many phases and regional variations.  In some states, tenancy was prohibited and the effort was to confer rights of ownership to the tillers.  Elsewhere tenancy was allowed, with an emphasis on recording the tenancy arrangement.  Also there were instances of reverse tenancy in some states.  However, both blanket bans on tenancy and giving tenants the right in some states/ regions to purchase leased land, have acted as a major deterrent for the lessee as well as the lessor, and obstructed access to land by the poor.  These provisions also encourage concealed tenancy that is exploitative to the lessee’. Furthermore, increase in urbanization and in the area under non-agricultural uses due to various development activities, speculation in land markets around cities and towns has also grown. Moreover, land acquisition by the government  for development projects raises land values in surrounding areas.  In many cases, state governments often promise enterprises (both public and private) land at low prices and as a result, the farmers tend to be net losers in the compensation they receive.  Since the land market is generally weighted against small and marginal individual farmers, to enhance their bargaining power, a group approach should be adopted wherever possible.

3.4.1.1Key Recommendations:

(i)                In order to enable the small and marginal farmers to participate and benefit from the land market, there should be a group approach to farm investment and cultivation wherever possible. Groups of poor farmers, especially women and dalits, who are willing to work in groups should be provided liberal assistance for acquiring land for joint activities, either in terms of collectively purchasing or collectively leasing in land in groups. Institutional credit should also be made available by way of medium or long-term loans for group investment and farming activities. Poor dalit women should be especially assisted to purchase or lease in land in groups through targeted schemes.

(ii)           The group approach need not be limited only to raising crops, but could also be extended to other activities such as fish production. There are success stories where NGOs have helped tribal women lease in land from the government on 10-year leases for fish ponds.

(iii)          In farmer’s cooperatives and other related institutions, there should be special provisions and rates for poor farmers, and especially for poor women farmers, who purchase production inputs and undertake marketing as a group rather than as individuals. There is need to encourage them to reorganize investment in lumpy inputs such as irrigation on a group basis, by providing special credit incentives for joint purchases.

(iv)          Restrictions on land leasing within ceiling limits should be removed to help improving poor peoples access to land through lease market and also for improved utilization of available land, labour and capital.  However, there should be legal safeguards in the lease contracts that would protect the small and marginal farmers, and a clear recording of all leases, including share cropping.

(v)              Indiscriminate, large-scale, ecologically damaging, socially harmful transfers of agricultural land to non-agricultural use should be checked.

(vi)          Speculative land markets in the immediate periphery of urban areas should be checked.

(vii)         The new areas which come under the urban development plans should be notified.

(viii)        To prevent long term speculative transactions on agricultural land the government should enact suitable laws.

(ix)           Farmers should be entitled to their share in rising land prices in the wake of urbanization and any form of major investment.

(x)           All medium to large-scale transfer of land from agricultural to non-agricultural use should be subject to an environmental protection clause, and its strict implementation.

3.4.1.2   Key Recommendations on Company and Government Land Acquisitions:

(i)         Land Acquisition processes

(a)       For land acquisition by a company there should be clearly laid-out procedures and transparency. The company should provide facts and figures to those losing land on how the project will help them and community in terms of  full package of rehabilitation and resettlement.

(b)           In case the company purchases land directly in the market, the Government should fix a floor price below which farmers would not sell the land to any company.

(c)        In case the company is unable to use all the land it has acquired, the unutilized part should be returned to the government for distribution to the landless.

(d)       Government land acquisition in the name of “public purpose” should be properly defined to include mainly the public utilities.

(e)       As far as possible, fertile agricultural land should not be acquired for or by any company.  The industrial units should be located in areas where  wasteland is available.

(f)        The Land Acquisition Act should be amended to incorporate compensation not only for the landed individuals but also for those who are landless and dependent on the land for livelihoods, for homes and items obtained from local common property resources. In other words, landless labourers, artisans, tenants, etc. should also be compensated with housing and livelihood security.

(g)       All compensation should follow the principle of gender equity.

(h)       Where possible resettlement should be such that an entire community or family network is not split up but settled in the same site so that support networks continue to exist.

(i)         While determining compensation, the basic principle must be replacement value at market rates of the land cost. This must be at the market rates that actually operate at the time of purchase and not those that are officially recorded. A suitable and credible mechanism must be evolved to arrive at operative market rates.

3.4.2 :  Contract Farming

Contract farming refers to a system of farming in which agro-processing or trading units enter into a contract with farmers to purchase a specified quantity of any agricultural commodity at a pre-agreed price. By entering into a forward contract, the company reduces the risk of not getting the required quantity of needed raw materials and the farmer reduces the risk of fluctuating market demand and prices for his/her produce. Small farmers in India are generally capital starved and cannot easily make major investments in new technical inputs. If the contracting company provides them quality inputs and technical guidance, contract farming could fill this gap. Also contract farming is different from corporate farming, as the land rights of contract farmers remain unaffected and fully protected. Theoretically contract farming could work to the benefit of both parties in the contract. In practice, however, there are several obstacles to the small farmers’ ability to realize this potential for which government support and institution building could help.  Since farmers, particularly small and marginal farmers operate in a market of unequal exchange vis-à-vis corporate and or trading houses, they are apt to lose heavily unless the state provides adequate protection and safeguards.

3.4.2.1            Key recommendations:

(i)         Set up a Formal Legal Framework for Contracts:  There is need for a legal framework for contract farming, as informal contracts are exploitative of small and marginal farmers.

(ii)        Legalise Tenancy:  In many parts of the country, agricultural tenancy is legally banned, although concealed tenancy exists. Tenants who do not enjoy security of tenure are not able to participate in contract farming. Hence, legalization of tenancy would be a precondition for enabling the tenant farmers to benefit from contract farming.

(iii)       Institutional Arrangements For Recording Contracts, Dispute Settlements Etc. on the following lines :

a)    All contracts should be recorded, say through the local panchayat and some authorized Government institution. This will promote confidence between the parties and these should be based on model draft which would give fair treatment to all contracting parties.

b)    A Block level committee could be formed to deal with any disputes arising from a violation of the contract. The committee should have the representation of farmers, the company, the panchayat and a local government official.  Farmers as well as the company should be able to approach the designated committee, duly empowered by law to mediate and settle the dispute.

c)    The contract should be managed in a transparent and participatory manner so that there is social consensus on how contract violations by either party can be settled without costly and lengthy litigation. Also the contract needs to specify all conditions clearly without ambiguity and ensure that farmers are fully aware of all the clauses.

(iv)        Provide Backward and Forward Linkages: The contract should have provision for both forward and backward linkages. Unless both the supply of inputs and

marketing for the produce are assured, on fair and equitable terms, small farmers will not be able to gain from contract farming.

(v)        Help the Farmers to open Bank Account : All contract farmers, especially those who are small and marginal, should have facilities for opening a bank account. Credit facilities should also be provided to them. If the payment for contractual produce is made through banks, the recovery of loans will be easier. In fact, there should be a tri-partite agreement between the contract farmers, the company and the bank for this purpose.

(vi)       Provide Crop Insurance Facility to Contract Farmers : In case of crop loss due to either pests and disease or adverse weather, contract farmers should be adequately covered by crop insurance, for which the premium should be paid equally by the farmers and the company.

(vii)      Provide Environmental Safeguards: The Government needs to ensure that contract farming, which is generally commodity specific and tends to promote monoculture does not threaten bio-diversity and agricultural ecology in the country. To prevent this from happening it would be desirable to provide guidelines for land use in different regions.

(viii)   Incursion of corporate bodies for agriculture, horticulture, tree farming should be discouraged to protect the livelihood of peasant farmers and others whose occupation are directly related to farming, otherwise, it will increase the army of rural proletariat, leading to rural unrest and militancy.  Government wasteland should not be settled or let out to corporate bodies.  It should be reserved for distribution among the landless poor and public purpose.  However, a view was expressed that contract farming mitigates against the concept of autonomous peasant farming and therefore, it should be discouraged if not banned.

3.4.3   Homestead Rights

In the vision of an emerging India, the right to a roof over one’s head needs to be seen as a basic human right, along with the right to freedom from hunger and a right to basic education. The supreme court held right to shelter is a fundamental right in UP Avas Evam Vikash Parishad vs. Friends           Co-operative  Housing Societies (list ARI, 1997, SC 152).  The 11th Five Year Plan provides the opportunity to realize this vision.

An estimated 13 to 18 million families in rural India today are reported to be landless of which about 8 million lack homes of their own. They live either in spaces provided by landlords (in case of farm labour), or park on government land, or on village common land, and so on. None of these options provide basic human security.

3.4.3.1  Key Recommendations:

(i)      All landless families with no homestead land as well as those without regularized homestead should be ensured 10-15 cents of land each. This can be done through either allotment of government land, ceiling surplus land etc. or purchase of land from the market and their allocation to the homeless poor. Some of the required sum could be arranged through reallocation of resources from existing schemes, such as the Indira Awas Yojana, SGSY, NREG etc.  The Kerala model could be useful in this regard.

(ii)  When regularizing the homesteads of families occupying irregular and insecure homesteads, the homesteads so regularized should be in the names of both spouses.

(iii)  All new homestead land distributed to landless families should be only in women’s name. Where more than one adult woman (say widows, elderly women etc) is a part of the household, the names of all female adults should be registered.

(iv)    As far as possible, the beneficiaries should be given homestead land in a contiguous block, within 1 km or less of their existing village habitation, with proper road and infrastructural connectivity. In such a consolidated block, essential facilities should also be provided such as  primary school, primary health centre, drinking water, and a women’s resource center.

(v)   The beneficiaries of homestead-cum-garden plot should be assisted by panchayats and line departments of government to develop plans and receive financial assistance for undertaking suitable economic activities such as livestock rearing, fodder development, planting of high value trees, and if water is available also flowers, fruits, vegetables, etc.  HUDCO/Housing Development Corporation, may open special windows to help homeless families to  secure dwellings on the plots to be allotted to them.