The promise of development is always a welcome-news, yet it often comes at a cost. More often than not, the actual cost of infrastructure development is higher than what is initially projected. The cost of compensating for acquisition of land is a foremost reason for this. The process of compensation often leads to obstructions from locals delaying the completion of projects on time making it difficult for the government to fulfill its promise of development. Indeed, some have argued that the demand for compensation is excessively high, the metrics for valuation of compensation are missing and the law on acquisition and compensation outdated.
Consider, for instance, the construction of a substation for 400 kV ‘Naya Khimti-Bharabise-Lapsephedi’ transmission line in Shankharapur Municipality. Around 50 families particularly from Tamang community in Lapsephedi area are expected to be displaced. The substation is supposed to deliver power from the hydropower projects built in Tamakoshi and Sunkoshi. The project is built with the investment of the government and Nepal Electricity Authority (NEA) with the support of a concessional loan from Asian Development Bank’s (ADB) ‘Electricity Transmission Expansion and System Improvement Project’ that amounts to Rs 18 billion. Around Rs 500 million has already been spent for compensation, yet families around the area of the proposed project have resisted. The project is now in the final stage, making it impossible for NEA to fulfill their demand to relocate the project. A coordination committee has been formed to settle the dispute but nothing has been achieved so far, putting the fate of the project in uncertainty. Similar kind of resistance has been faced in the construction of transmission lines all over the country. In fact, the prolonged obstruction from locals for the construction of 220 kV Bharatpur-Bardaghat and 400 kV Hetauda-Dhalkebar-Inaruwa transmission lines compelled the World Bank to discontinue its financial aid. All of this has contributed to the government’s financial burden along with the existing pressure of completing the project on time.
Such obstructions are not limited to the construction of hydropower or transmission lines. Peoples’ resistance to the construction of the national pride project of fast-track in Khokhana proves that such resistance to land acquisition has been a great threat to the overall development of infrastructure projects in the country.
If we look into the legality of the government’s action in acquiring land, it does hold the power to confiscate private property of individuals for public purposes that are undertaken in the interest of or for the benefit of the general public. The Land Acquisition Act (1977) allows such confiscation of private property and the confiscated lands are subject to compensation. But it is also important to look at the other side of the coin and understand that this same promise of development comes in the form of loss of local people. Loss of their private property and livelihood is the reason why people resist despite getting compensation from the government.
The process of land acquisition is very long which can be done only after initiating preliminary action like mapping of such land among others by a Gazetted Class Three officer, then submitting the report to the concerned stakeholders and acquiring land only after giving prior notification and information to the landowners. Such a procedure mentioned in the law seems to be missing in practice. Moreover, the same Gazetted officer is responsible for determining the amount of compensation which is done without taking in the consent of the primary stakeholders–the landowners. This faulty procedure of determining compensation creates a distrust and dissatisfaction among the landowners leading to disputes and obstruction.
While the global practice incorporates the compensation for possible loss of revenue from that land along with bearing the cost of rehabilitating such families, the compensation mechanism in Nepal is just based on the current market value of the land.
As said earlier, resistance continues even though local people get a considerable amount of compensation because different people view their land differently. So it is difficult to bring the whole class of landowners into common compliance. Land itself is a valuable asset, the high demand for both farming and non-farming uses but very limited supply makes it very valuable. But for some, the material compensation they get in return might not justify the perceived worth that they hold of their land, primarily for those whose livelihood depends on such lands.
Such people do not just consider the on-hand value of their property but look into benefits that land has to offer–the future revenue that they earn either from agricultural or non-agricultural usage of that land. The provision of compensation in the current law fails to take all of these into consideration making it difficult for the landowners to comply with the compensation being provided. While the global practice incorporates the compensation for possible loss of revenue from that land along with bearing the cost of rehabilitating such families, the compensation mechanism in Nepal is just based on the current market value of the land which is not enough for those at loss.
According to Michael Levian, who has studied land confiscation in India, land is a ‘zero-sum asset’, meaning the gain of land for one party equals the loss for another party. So, the confiscation of land creates an irreversible threat to such landowners, where they have to let go of the physical access of their property, making them at absolute loss against the gain of the government. Along with this, they have to leave what they have been doing all their life at once and adjust into a new life. The loss of their livelihood is also what landowners resist, not just loss of their physical property.
Land and loss
Considering the tradition of passing down land from one generation to the next in the context of Nepal, land is accountable for the livelihoods of multiple generations of the same family, not just one. So, losing such invaluable land to the government means the loss of an upcoming generation, not just one single family, which explains why landowners resist the confiscation of their land despite getting compensation.
In such cases land to land compensation might be a promising solution to solve such disputes. Section 14 under Land Acquisition Act allows for a provision whereby the government may allot any kind of available land to those who want to obtain compensation in the form of land in return of their acquired land. This might create a win-win situation for both parties. At the same time, there is an urgent need to update our four decades old Act that incorporates the global practice of compensation along with the provision of rehabilitating the displaced locals. All of this will lead to the completion of infrastructure projects without any disruption eventually contributing to the overall development of the country.
Niyati Shrestha is a researcher at Samriddhi Foundation, an economic policy think tank based in Kathmandu. The views expressed in this article are the author’s own and do not represent the views of the organization. [email protected]