The land acquisition issue has been brushed under the carpet for the time being. Yet officials in the department of industrial promotion and policy say that the land banks available with many state governments are getting exhausted. A JP Morgan study of the biggest 100 projects suggests that 43% have land problems. So, if the economy picks up as the government believes it will, land will once again become a significant constraint on growth.
One option is to create land instead of acquiring it. Land cannot be created out of thin air, but can be reclaimed from the sea. Reclamation is expensive and hence not used widely, in India or globally. But since the new land acquisition rules provide for paying up to four times the going land price, this will in some areas mean Rs 1 crore per acre or more. Reclamation will typically cost much less.
A dramatic illustration of this comes from Navi Mumbai airport. This is being set up at an estimated Rs 14,000 crore. However, Dutch consultancy firm Royal Haskoning DHV has proposed an alternative offshore airport site at Madh Island, on reclaimed land. This will cost only Rs 3,000 crore if built to a height of 1.5 metres, bunded and equipped with giant pumps to combat flooding during storms. Alternatively, the entire airport can be raised to a safe height of 7-8 metres, for Rs 6,000 crore. That will still be less than half the current cost. Alas, so many powerful interests have bought land in the Navi Mumbai area at over Rs 10 crore per acre that it is politically impossible to change the project site now.
Yet the Dutch proposal highlights two facts. First, offshore land today can be far cheaper than land acquired from farmers. Second, offshore land can always be expanded through further reclamation. Most airports have just one or two runways, and when these get choked with traffic, new airports have to be created. Mumbai already has three airports and is getting a fourth. That is very wasteful of land and accompanying infrastructure.
The new Istanbul airport has enough spare land to expand gradually to six runways. Such expansion will be impossible at Navi Mumbai. But it will be entirely possible at offshore locations, by reclaiming more land.
The world over, new airports in land-scarce countries are being built on reclaimed offshore islands. These include Hong Kong’s Chek Lap Kok airport, Korea’s Incheon airport, and four airports in Japan — Kansai, New Kitakyusha, Kobe and Chubu.
Why not use reclaimed land for industries too? This is already being done at some coastal locations. Gujarat plans a major new industrial port city in the Gulf of Cambay at Dholera, to be Ahmedabad’s natural outlet to the sea. This will also be part of the Delhi-Mumbai industrial corridor. Dholera will reclaim large amounts of land from the mud flats in the Gulf of Cambay.
Dredging for a port provides, at no additional cost, sand needed for land reclamation at ports. Elsewhere, dredging for reclamation typically costs more than acquiring farmland. But with skyrocketing land prices and farmer resistance in India, large industrial estates on reclaimed land make eminent sense, especially around the new port complexes in Modi’s Sagarmala (ring of ports) plan. These do not have to be major ports: they can be minor ports too.
Environmentalists will oppose offshore islands, which can face issues like subsidence, flood-proofing and typhoon-proofing. These have been tackled successfully elsewhere, and can be tackled in India too. Such sites have a major environmental advantage: they can use abundant sea water instead of scarce fresh water for water-intensive industries like thermal power. They can be located where there are no mangroves. Navi Mumbai airport requires large-scale mangrove felling, but the Dutch airport proposal does not.
Some greens believe no land should be reclaimed for industrial or commercial purposes. That is pure fundamentalism. We should protect our coasts, but also provide for industries and airports. It is entirely possible to have both. Our coastal regulations should be modified, if necessary, to facilitate the creation of offshore land for industries, airports and other land-intensive uses.
Much land acquisition in India has become a racket, as illustrated by Robert Vadra’s activities. Politicians and sleazy speculators are early buyers in big upcoming projects, often based on insider knowledge. In many cases the speculators reap the biggest capital gains, not the farmers who sold the land to them. Let nobody think that high acquisition prices benefit only farmers — the beneficiaries include the high and mighty.
But speculators cannot grab the land around offshore islands: there is none to grab. So, the offshore option neither rewards speculators nor dispossesses farmers. Those are powerful reasons to adopt it.