The Indian state has been thrown into a panic by agitating farmers who have declared war against the Special Economic Zones in States across the country. Facing lathicharges and bullets, the farmers have been coming out on the streets to protest the acquisition of fertile farmland and block the proposal that the Governments are convinced will generate massive employment and increase India’s GDP growth by two per cent.

At stake are 150,000 hectares of mostly fertile land. The farmers are rallying around local groups and organisations in what many describe as a fight to the finish. The proposal to establish 513 SEZs is now seen to be an invasion of corporate greed. [Of these, only 250 have been notified.]

A farmer participating in one agitation just recently in Jhajjar, Haryana, told Covert, “One of our relatives has been paid compensation, but now the money is over. He bought mobile phones and other gadgets for the house and paid off the debts. He did not know how to invest and now he is a pauper without any means of livelihood. Money is not enough. How will we live without our land?”

Last year, the bloodbath in Nandigram that killed 11 farmers protesting against the acquisition of land for a proposed chemical hub being set up under a SEZ proposal, was national news. This in turn led to a re-look at the whole SEZ policy. In Maharashtra, the locals are blocking the setting up of a Special Economic Zone by Mukesh Ambani’s Reliance Industries. In Uttar Pradesh, farmers are protesting against land being acquired for Anil Ambani’s Dadri project. In Haryana, Manesar, people are blocking the acquisition of land for yet another Mukesh Ambani SEZ project. In Punjab, farmers are up in arms against the forcible acquisition of farmland for an international airport and a thermal power plant. In Chhattisgarh, farmers are fighting against the acquisition of land for a Tata Steel plant. In Lanjigarh, Orissa, farmers are struggling against the transfer of land for a bauxite mining and alumina plant. Similar massive protests are currently on near Puri in Orissa against the acquisition of large tracts of land for a university, for a SEZ by the Tatas in Gopalpur, and for a nuclear power plant at Patisonepur in Ganjam. Officials admit quietly that a new struggle is emerging every day, with the large acquisitions under SEZ triggering off new as well as intensifying old protests.

Inept handling by the concerned Governments have made matters worse. Nandigram is a case in point. As is now Maharashtra, where the Reliance-promoted Maha Mumbai SEZ at Raigad has run into trouble. Chief Minister Vilasrao Deshmukh assured the State Assembly that there would not be forcible land acquisition. Later, Section 6 of the Land Acquisition Act was invoked, preventing the farmer from transferring or selling the land. Reliance, however, was given special permission to acquire land privately. This resulted in a single window option for the farmer who is now receiving less than the market value for the land: Rs 10 lakhs as against Rs 13 lakhs per acre. The result is that Reliance has been able to acquire 1,559 hectares of land, in what is a 14,000-hectare project. The State Government has opted out, with the confrontation now being between the farmers and the private company. Ulka Mahajan of Sarvahara Jan Andolan, active in the area, said that several FIRs have been filed against the company for acquiring land fraudulently. Litigation will further slow the project, which is still at “acquiring the land” stage.

Although the highest compensation package in the country is offered at Jhajjar, Haryana, Rs 22 lakhs per acre, the farmers are refusing to sell the land. Captain Satvir S. Gulia who is mobilising the farmers against this SEZ told Covert, “They have been able to purchase less than 35% of the land so far. Even this would not have been possible if the Government had remained out of the project. Firstly, they fooled the rest of the country by saying it was barren land. Then they kept talking about using the Land Acquisition Act. The farmers are feeling very insecure.”

The proposed SEZ in Andhra Pradesh, the Industrial Corridor, is now assuming the dimensions of a major confrontation between poor fishermen and the Government. Chief Minister Y.S. Rajashekhar Reddy issued a Government order — GO 34 — for the formation of the corridor shortly after coming to power. The coastal corridor will cover nine districts, including Srikakulam, Vizianagaram, East and West Godavary, Guntur, Prakasham and Nellore districts. This is fertile paddy land. Social activist Saraswathi Kavula, working with the tribals and Dalits who will be displaced if this project goes through, told Covert, “The total rice produced here is over 9,601,045 tonnes. If the corridor is formed, the state will lose 67,64,203 tonnes.” Other crops produced here include bajra, maize, black gram, coconut, sugarcane, cashew nut, turmeric.

The agitation against GO 34 is gaining strength. Fishermen are particularly worried about the adverse impact of the SEZ on marine life, already at risk because of the chemical industries that have been constructed in the area. The project is expected to displace close to 15 million farmers, eight million fishermen and another four million farm labourers. Mangrove forests are being destroyed for setting up industries and a port along the coastline. The movement is being led by the Committee Against Formation of Industrial Coastal Corridor. Activists said that the battle against the acquisition of the land has already begun, and the State will find it difficult to develop the SEZ.

A well-known researcher on SEZ, Aseem Srivastava said, “The most undesirable outcome of this scheme is that it has plunged the country into a state of civil war.” In Orissa, the police is camping in schools to counter anti-SEZ movements. Leaders of the movement in Kakinada said they had lost count of the number of times they had confronted the police. It is estimated that 114,000 farming households and an additional 82,000 farm-worker families dependent on the farms, will be displaced under the SEZ. Experts have circulated figures registering a loss of Rs 212 crores per year for these farming families. This does not include the loss inherent in the demise of local rural economies. The promise of rehabilitation is not accepted by the farmer; he knows that 75% of the 40 million Adivasis and Dalits who lost their land to industrialisation since 1950 have not been rehabilitated.

The development of SEZs is being held up because of the agitation in all States. Government officials say that the few that have started operating under the SEZ Act 2005, have already registered a massive investment running into several thousand-crores and have employed over a million persons. They point out that the response from both within India and abroad has been “overwhelming” and the list of SEZ developers includes large companies like Nokia, Wipro, Motorola, Apache, Mahindra World and others. They claim that of the 513 formal approvals given till date, at least 177 are for sector specific and multi-product SEZs that include manufacture of textiles, leather footwear, gems and jewellery, electronics hardware. However, officials admit that the development of the large Special Economic Zones is held up and the acquisition of land has been “extremely slow”. Despite the back channel support given by Governments to companies [such as Reliance in Maharashtra] people’s resistance is proving to be a difficult hurdle.

The FDI investment pattern over the past four years contains the reasons for this “overwhelming” response. FDI investment in the real estate sector has shot up from 4.5% [$2.70 billion] to 26% [$ 8 billion] in 2006-2007. An ASSOCHAM study on the “Future of Real Estate Investment in India” pointed out that the real estate market offers maximum returns to investors and is set to touch a $60 billion market size by 2010. The study maintained that SEZ is the new destination for real estate investors, and 50% of the total SEZ projects are developed by real estate developers. Also, the international investors are showing keen interest in establishing their presence over domestic real estate business. The Indian SEZ has become a natural choice for foreign investors since the Chinese real estate market has reached its saturation and they prefer to invest in freehold lands available in India. International investors like Royal Indian Raj International, Blackstone Group, Goldman Sachs, Emmar Properties, Pegasus Realty, Citigroup Property Investors, Lee Kim Tah Holdings, Salim Group, Morgan Stanley, GE Commercial Finance Real Estate are learnt to have finalised plans worth US $6.33 billions for India.

In Kakinada in Andhra Pradesh, the State allegedly colluded with the private players. District revenue officials told the illiterate farmers that their land had been notified under the Land Acquisition Act. Later they were approached by the real estate agents offering just slightly better compensation, and thereby forcing them to sell their lands. Rajesh Kakinada who is leading the agitation here told Covert, “45% of the land is acquired in this manner. The State machinery worked in favour of the real estate sharks. They even went to the extent of using brute police force against those who were resisting.”

Adding to the anger of the farmers are reports that those who lost their land have since been unable to make ends meet. Some of the farmers who were displaced by the Pollepally SEZ in Andhra Pradesh told Covert they were now working as construction labourers within the zone. Many of them spoke of harassment at the hands of supervisors, maintaining they were being made to work for more than 12 hours. Reports that 42 farmers who lost their land to SEZs have died since, have not been effectively countered by the State machinery. Displacement and rehabilitation, experts fear, will be a major issue that will add to agrarian unrest as a result of the SEZ policy. This, they point out, is also one of the main factors behind the current agitations, as the farmers do not want to be sacrificed at the altar of development.

The Government has been unable to intervene effectively to dispel these fears, and the frequent firing by State police forces on agitating farmers has added to the apprehensions and made the resistance stronger [¼]

Appu Esthose Suresh and Payam S.

“Farmers should have some stake in SEZ”

Interview with “Immediate Past President” of Assocham, Venugopal N. Dhoot:

Q: With the kind of resistance that SEZ developers are facing in land acquisition, virtually all projects are either stalled or crawling. Do you think there is a fundamental problem in the policy?

A: Not at all. Many SEZs have already come up. So I don’t buy that argument. And I don’t wish to comment on the good and bad of policy.

Q: Is the SEZ policy lopsided: benefits to the industry but not the farmers who are displaced?

A: It helps both the industry as well as farmers. See, it is like this. Farmers are paid compensation and jobs, once the trajectory of progress is set in motion, everyone benefits.

Q: Do you think that land should be acquired by the industry from the farmers?

A: Yes, ASSOCHAM maintains the position that the land should be bought by the industry. Farmers should be adequately compensated for their land, some stakes in SEZ, and jobs. This should ideally be a win-win situation.

Q: What have been the drawbacks of
SEZ policy? In your view, what can be done to overcome these, and the other hurdles?

A: No drawbacks. I reiterate our formula for the larger benefits of everyone involved in SEZ.

Q: Do you think SEZs can create jobs for all those who are displaced from their land?

A: I have already shared whatever information I have. Definitely jobs will be created.

Q: Do you agree that there is an overwhelming sentiment against SEZs?

A: No comments.

Q: How can SEZs usher in a new India with less poverty and suffering?

A: SEZ implemented on the basis of the formula that I mentioned earlier, with adequate compensation and stakes in the SEZ will eventually do this.