The Meeting Against SEZ

[aabhisheksirohi]

Haryana SEZ !!

Let me reveal some of the so called hidden facts of Reliance SEZ ( Haryana ).

It is a JV agreement between RIL and HSIIDC and is termed as Reliance Haryana SEZ Ltd on papers with RIL holding 90 % stake and HSIIDC the rest.

This is how land is divided for SEZ. Reliance SEZ on Haryana is 25000 acres site proposed.Out of this low polluting units will occupy 6500 acres, commercial establishments 5000 acres, infrastructure projects 5000 acres, residential units 3750 acres and 1250 acres would be proposed for recreational facilities.Rest 3500 acres yet to be decided.

Since this is a JV contract so Haryana Govt had to provide some percent of land to RIL.What is agreed on papers is Haryana Govt will provide 1375 acres of land to RIL.For which RIL will pay hefty amount to Haryana Govt.

It was long back Haryana Govt (HSIIDC) had acquired the land from the five villages named as near Garhi Harsaru in Gurgaon — Khandsa, Narsinghpur, Mohammedpur, Gadauli and Harsaru for the industrial development of this region at what amount per acre God knows !! I believe the rate per acre is not set by HDIIDC that time.

Ironically HSIIDC transfer the same land (1375 acres) to RIL for SEZ development. HSIIDC had purchased the land from farmers at cost of 20.75 lakh per acre.Farmers were so happy with the deal. In return HSIIDC will receive from RIL exact cost of compensation paid to land acquistion collector by HSIIDC, 9 % interest amount on this amount from the date of payment made to LAC till the payment to HSIIDC, 15 % administrative charges on the amount of compensation paid.So the Haryana Govt and the farmers of this sections were happy.

As per SEZ rules, RIL had to purchased some section of land directly from farmers. With the rate of 20.75 lakh per acre and the Hype and Media coverage about mega SEZ future plans the land prices shoot up and ironically RIL started offerings lucrative prices to the farmers. About 1000 acres of land is purchased at the given price tag of 1.80 crore per acre. So the farmers of this section of land started feeling in heaven and the deal is struck.

Now the sections of those farmers whose land was taken up by HSIIDC at the rate of 20.75 lakh per acre move to the Supreme court alleging HSIIDC did not acquire their agricultural land for a SEZ, they have no right to transfer the land to other company. To add fuel to the fire union Commerce Minister speak in favour of farmers that no fertile land should be acquired for SEZ. And this is enough for the agitation against the administration and Haryana government. Bottom line is this is on everyone lips Haryana Govt is selling fertile land to RIL. More media coverage on this news bring local state parties join with those farmers and the rest is history as we know.Both the Haryana government and HSIIDC maintain they are not doing anything illegal.Sh Hooda defend himself that their government has not acquired a single inch of fresh land for SEZ. This particular patch was acquired during the tenure of the previous government.

Now coming to those sections of farmers who sold the land directly to RIL.
RIL had come up with innovative ways of compensating farmers in SEZ area. RIL has now offered to pay farmers and landowners in SEZ notified area till perpetuity.This means compensation in regular installments for a life time. More elaborate ..company is arranging on the agreement with the farmer where it would pay him a certain part of land price as a token. RIL will pay the farmer a monthly sum of money forever after. In case of death his heir would continue to get money . This will be done in addition of employing at least one member from the family in the project. It’s a part of Resettlement and rehabilation (R&R ) package for SEZ . This move is addressing to the concern that due to lack of awareness land owners in rural areas often end up wasting all the bulk money that they get by selling their land.To educate these farmers RIL has tied up with HDFC and ICICI banks in Jhajjar where the bank hierd local pointspersons in the villages to stay updated with land deals and convience sellers to sensible invest the money.

This is what RIL Haryana SEZ plan!! Dont know how many of here knows recently Bharti and RIL had acquired fertile lands of Punjab and UP ( tarai region ) fow agricultural development. Deal is in such a way company will arrange the best seeds and will help in all sorts of providing irrigation facilities to farmers under SEZ to grow best quality fruits, vegatables, cerals, grains etc.....ALAS!! No media coverage on this hardly any article in newspaper. Farmers of this section of society is fetching handsome lumpsome of money. Middlemen is eliminated and SEZ helps them to get the actual price of what they deserve.Sh Hooda cant do anything now as this is the first time RIL had come up in North region and Sh Hooda will try its best not to slip 40,000 crores infrastructure, industrial investment and development in his region.

However I'm looking for Haryana Kissan Mazdoor Sanghrash Smiti's meeting at Badli.Gaurav do post MOM and its POA and RFP.

 

[spdeshwal]

No, you haven't answered my questions Gaurav Bhai. I believe you know the answers but don't want to relate yourself with the true answers but opposing it because you have to.

I know the answers too. I had travelled once from Jhajhar to Badli to Farakhnagar and have fairly good idea about the land .It is average kind of land with not so high rate of fertility and minimum irrigation facilities.

So how much you think a farmer with 1-2-3-4 acres of land would produce grain worth for. Rs. 10000-20000-30000-40000 per year. You have to take into account the costs; Cultivation ( mostly don't have their own tractor or pair of oxen), furtilisers, seeds, pesticides and irrigation. You must discount here for their labour as well.

If you don't cultivate yourself than, do you think any body would pay"badha" to tune of Rs 10000 or more for that land?

How much grain you need for average family consuption. You need some land for fodder for the milk cattle.

How much you need for an average family?

Do i need to explain how much you need to send two kids even to a govt. school?
Don't you think that their kids deseve better schools and better education. Why only Govt. Schools. Private schools in rural areas charge from 200-500 a month per child.

How about higher education, their marriages, dwellings etc.

You can't really waite for 5 years, 10 years arguing that the prices of the land would double or tripple by than.

You know Gaurav, generation in their 40-50s have spent their lives languishing in poverty.

This is a God given opportunitiy for the younger generation. You can't conclude simply by saying that the younger generation want to live lavishly without putting efforts or working hard for gaining education. This is the only chance for them going for a decent education.

I would like to add here that if people like you really want to help them then first thing you have to do is throw the 'garb of socialism with false hopes' away and offer them some genuine advise like how to invest wisely. How to ensure a steady income without indulging in too much of speculative ventures.

I hope it makes some sense for you and others who support your view.

Cheers!

 

[gauravgu]

No, you haven't answered my questions Gaurav Bhai. I believe you know the answers but don't want to relate yourself with the true answers but opposing it because you have to.

I know the answers too. I had travelled once from Jhajhar to Badli to Farakhnagar and have fairly good idea about the land .It is average kind of land with not so high rate of fertility and minimum irrigation facilities.

So how much you think a farmer with 1-2-3-4 acres of land would produce grain worth for. Rs. 10000-20000-30000-40000 per year. You have to take into account the costs; Cultivation ( mostly don't have their own tractor or pair of oxen), furtilisers, seeds, pesticides and irrigation. You must discount here for their labour as well.

If you don't cultivate yourself than, do you think any body would pay"badha" to tune of Rs 10000 or more for that land?

How much grain you need for average family consuption. You need some land for fodder for the milk cattle.

How much you need for an average family?

Do i need to explain how much you need to send two kids even to a govt. school?
Don't you think that their kids deseve better schools and better education. Why only Govt. Schools. Private schools in rural areas charge from 200-500 a month per child.

How about higher education, their marriages, dwellings etc.

You can't really waite for 5 years, 10 years arguing that the prices of the land would double or tripple by than.

You know Gaurav, generation in their 40-50s have spent their lives languishing in poverty.

This is a God given opportunitiy for the younger generation. You can't conclude simply by saying that the younger generation want to live lavishly without putting efforts or working hard for gaining education. This is the only chance for them going for a decent education.

I would like to add here that if people like you really want to help them then first thing you have to do is throw the 'garb of socialism with false hopes' away and offer them some genuine advise like how to invest wisely. How to ensure a steady income without indulging in too much of speculative ventures.

I hope it makes some sense for you and others who support your view.

Cheers!

Dear Deshwal ji,

I thought ke you would have got the answers from Mr. Lakra, Mr. Kadian and a few from my side.
However I will consolidate them here once again for your reference.

What was the average price of the agricultural land in the area before this project was initiated?

What would be the annual increase in land prices in absense of this project?


I had cleared in one of my earlier posts regarding this…
I do agree that earlier the price of land was not so much tempting.
‘For your kind attention the land within 4 sq. k.m. is paid much much more than what is being paid at Badli as of now...
As you people are well aware of that Badli is on border area..other side being in Delhi where the land is being sold at around 2 crore/killa(and remember that area is stone throw away from Badli and isn't industrial also)...
Additionally a 6/8 lane highway is proposed in that area to connect Sonepat-Gurgaon (to bypass Delhi in between) by 2010.
So it is quiet obvious and expected the land prices would have been risen in absence of SEZ saga also…’

Although it is quiet true that % of farmers with land holding > 5 acre is low.
However if people with land holding 2/3 acres will be most sufferers, if they opt for selling their lands....

As you might be knowing and can not deny the fact that most of the money is being used for building a good house rather I should say kothi..and having some good vehicle as of Scorpio/Safari which is more popular in rural areas(which I think are not going to support their families in any way)…also a large portion will attract tax also…
So concludingly only a small portion of amount will be left which is not sufficient enough to start your own business…Moreover every one can’t expect to be a good businessman as Reliance is…
Also as Mr Samar has said “they are not aware enough of investing their money.They cant reach to investment specialists.Most of them would end up as landless labourors in their own fields.”

Also once people are addicted of lavish lifestyle….it will be hard to live without them in long run say in another 4-5 years…
So what these youngsters are going to do…at that stage they will not be skilled enough to take some job opportunity and at the same time will not be possible for them to work harder to earn their livelihoods…
So these are the people who are going to take alternate illegal ways to fulfill their fantasies…

Also you said “This is a God given opportunitiy for the younger generation”.
I think you are mistaken on this take…It means u r indirectly saying Reliance and more specifically Mukesh as God…
I think its not appropriate to give status to some businessman…
Any how he is coming to expand his business and this is win win situation…

Additionally, it is not Only opportunity and such opportunity are standing next door….

However I would have appriciated Govt's effort if proper irrigation facilities and more subsidies on fertilisers and seeds should have been provided to farmers alongwith round the clock electricity.


My concern is that either land should be given on lease (patte par) or we should be shareholders.

Here I would like pay tribute to Ch. Chootu Ram who has said that Zameen hamari to malkiana huq hamara..

I hope these points will definitely help you and some more follow members to reassess your points.

Please feel free to pour some more practical solutions for Common Cause…

Thanks and Regards,

Gaurav Gulia

 

[rameshlakra]

I think the issue is " how to optimise the benefits to the farmers" . The verdict is divided and the debate still open. The farmers are still not happy and the solution lays some where else, and, definately putting off SEZ is not the solution. I am in support of farmers getting a stake in the final product, since they own the most important "ingredient" in the SEZ. How best to do, how to form a pressure group, Mazdoor sangh and momentum should be the "focus". Asking government to reverse the decision is not in the favour of farmers of the region. In such matters generally, two things come out. First, there will be individual interests and, second the collective interests. If i own land to the tune of 20 Acres, which is being aquired. I definatley will have individual interests at the stake, and it is perfectly natural to fight to save it. But if it is coming in the way of collective interest, a cource correction with a mutually agreed path is required. On summation, it is better to rally behind an issue which is practical, resonable and benificial to all. We can go endlessly saying that the farmers will waste the money, i think we need to spread "education" rather than insulating them form large sum of money, also , why not make an "investing" organisation for reliance SEZ farmers and buy large tracts of land elsewhere.

regards

 

[dahiyars]

The Meeting Against

Dear All

Second Part of The SEZ continued

Regulate Land Use within SEZ Area
There are certain provisions contained in the SEZ Rules, which have given rise to apprehensions regarding misuse of the SEZ Policy. For instance, Section 5(4) of the SEZ Rules state that “The Developer or Co-Developer shall have at least twenty-six percent of the equity in the entity proposing to create business, residential or recreational facilities in a Special Economic Zone in case such development is proposed to be carried out through a separate entity or a special purpose vehicle being a company formed and registered under the Companies Act, 1956.” However, no guidelines have been provided for the creation of such facilities, either in terms of land use or other essential regulatory parameters of such real estate development. The RBI has recently raised the interest cost of credit for real estate development in the SEZs. In keeping with such an approach, there is a need to regulate real estate development within the SEZs.
The SEZ rules have to clearly lay down norms for the development of infrastructural facilities by private developers within the SEZs, in terms of what is permissible and what is not. The role of the SEZ Authority and the Development Commissioner in this regard needs to be categorically defined. Most importantly, the SEZ Rules should contain a Land Use Plan for the giant SEZs. The issue of housing facilities for the workers in the giant SEZs have to be concretely addressed. Wherever residential complexes would be permitted within the SEZs, they should be built not only for the management and the white-collared employees but also for the workers. A situation where lakhs of workers of the SEZ units would be forced to stay outside the SEZ area leading to a proliferation of shantytowns in neighbouring areas should not be allowed to arise.
Review Tax Concessions
The revenue implications of the tax holidays being given under the SEZ Policy have to be seriously considered. According to media reports, internal estimates of the Finance Ministry suggest a revenue loss of Rs 1,75,487 crore against an estimated investment of Rs 3,60,000 crore. While these projected estimates are based upon certain assumptions, the issue cannot be brushed aside by saying that these revenue losses are “notional”, as the Minister for Commerce and Industry has done in the Parliament. In a context where subsidies on food, fuel and fertiliser are being whittled down and the social welfare schemes promised in the NCMP being either underfunded or abandoned by the UPA Government citing resource constraints, the justifiability of the tax largesse to big business under the SEZ Policy needs to be thoroughly debated.
Given the concerns expressed from different quarters with regard to revenue loss, tax concessions in some areas in Chapter VI of the SEZ Act, under the “Special Fiscal Provisions for Special Economic Zones” need to be reconsidered by the Government:
(a) While customs and excise duty exemptions for units within the SEZs can be understood as measures to ensure price competitiveness of exports, the case for providing 100% exemption from income tax on profits for the first 5 years and 50% for the next 5 years by modifying the Income Tax Act, as has been provided in the Second Schedule of the SEZ Act, does not seem to be persuasive. Such fiscal incentives for new units, if it is to be given at all, should not be for more than 2 years, as was done in the case of Chinese SEZs. Income tax concessions for a period longer than 2 years should only be provided for the reinvested portion of profits, and that too only for a maximum of five years.
(b) Chapter VI of the SEZ Act provides for similar exemptions, drawbacks and concessions for the entrepreneurs setting up units within the SEZ and the developers of the SEZ. Thus private developers will be able to derive tax benefits without contributing to exports. The positive net foreign exchange earning requirement, specified in Chapter VI of the SEZ rules, is only valid for units within the SEZs and not the developers. Therefore the developers and the entrepreneurs should not be treated on par as far as tax exemptions and concessions are concerned. Fiscal incentives for developers, if they have to be provided at all, should be separately specified and should be considerably lesser than the ones provided for the entrepreneurs for income tax as well as customs and excise duties.
(c) Exemption from Service Tax has been granted to the developers in a Special Economic Zone in the SEZ Act. Moreover, units in the International Financial Services Centre and Offshore Banking Units have been given income tax exemptions equivalent to those of other units in the SEZs. Securities transactions entered into by non-residents through the International Financial Services Centre under a SEZ have also been exempted from the Securities Transaction Tax. These policies will simply encourage investors, including in financial services, to move from other locations in India to SEZ areas, with no benefit to the economy and substantial revenue loss. These exemptions, which are unrelated to exports, should not be granted.
(d) Section 50 of the SEZ Act state: “The State Government may, for the purposes of giving effect to the provisions of this Act, notify policies for Developers and Units and take suitable steps for enactment of any law: - (a) granting exemption from the State taxes, levies and duties to the Developer or the entrepreneur”. Thus the SEZ Act empowers the State Governments to take decisions related to exemptions of State taxes. However, Section 5(5) of the SEZ rules state that “Before recommending any proposal for setting up of a Special Economic Zone, the State Government shall endeavor that the following are made available in the State to the proposed Special Economic Zone Units and Developer, namely: - (a) exemption from the State and local taxes, levies and duties, including stamp duty, and taxes levied by local bodies on goods required for authorized operations by a Unit or Developer, and the goods sold by a Unit in the Domestic Tariff Area except the goods procured from domestic tariff area and sold as it is; (b) exemption from electricity duty or taxes on sale, of self generated or purchased electric power for use in the processing area of a Special Economic Zone”. In effect, the SEZ Rules have imposed the granting of tax and duty concessions upon the State Governments, which is not in keeping with the spirit of the Act. Either this rule has to be amended or the Central Government should fully compensate the State Governments on the loss of revenue on account of these tax and duty exemptions.
(e) The granting of duty concessions to goods sold by a Unit to the Domestic Tariff Area should not be permitted, since such concessions are intended only for exports. This will imply major diversion of productive activities away from the Domestic Tariff Area to the SEZ, with substantial revenue loss for both the Central and State Governments.
Protect Worker’s Rights
Section 5(5) (e), (f) and (g) of the SEZ Rules asks the State Governments to delegate powers under the Industrial Disputes Act to the Development Commissioner and to declare SEZs as Public Utility Services. These are incompatible with the SEZ Act, which does not contain any such provision. Such deviations of the SEZ Rules from the parent Act have to be corrected. The ILO recommendation regarding separation of powers between the Development Commissioner of an Export Processing Zone and the Grievance Redressal Officer should be seriously considered in this regard.
Prevent Enclaves of Speculative Finance
The provision for setting up Offshore Banking Units and International Financial Services Centres within the SEZS needs to be qualified. While the need for efficient financial intermediation and credit delivery for the purpose of industrial and export promotion within the SEZs is understandable, utmost care has to be taken to ensure that these financial entities do not develop as tax havens for speculative finance capital. There is no need for providing tax breaks for the financial entities within the SEZs. All financial activities should be within the regulatory ambit of the RBI and subject to the same tax provisions regardless of whether their offices are physically located within the SEZ or the Domestic Tariff Area. Moreover, the RBI needs to ensure that the financial activities permitted within the SEZs are strictly related to the economic activities within the zone.
Amend SEZ Act and Rules
The suggestions made above involve several amendments to the SEZ Act and the SEZ Rules. Unless these changes are brought about, the SEZ Policy would degenerate into a free for all, which would have serious consequences. The UPA Government should therefore initiate a Review of the SEZ Act at the earliest with a view of making appropriate amendments. Amendments to the SEZ Rules can be made consequent to the Amendment of the Act. The Board of Approval should stop granting fresh approvals until the completion of the Review process. The changes suggested in the Land Acquisition Act and the formulation of a National Rehabilitation Policy, preferably through the passage of a Central legislation, should also be considered on an urgent basis.
R.S.Dahiya

 

[dahiyars]

Myth: The SEZs generate employment for at least 500,000.

Fact: The above figures( in this claim) are really meaningless except for statisticians!Ground realities indicate contrary situation. At the beginning of the 20th century, for instance, some 7.5 m. had applied for a mere 28,000 jobs in the Indian railways. For a huge country like India this figure has no meaning.Even if 500,000 peaple were to be employed out of these 7.5 m. it is a mere drop in the ocean. On the other hand millions of assured jobs can be created if the total amount of revenue loss of Rs 1750 b., and the several times higher public sector investment to follow is used for employment generation. Even the IT sector has provided only 500,000-600,000 jobs. So much is being talked about the outsouircing service industry but the sector employs only 200,000 people.
Initially employment in these zones rose significantly but there has been a steady decline generally followed by stagnation. For instance, while employment in the zones grew at the rate of over 50.2 % between 1966 and 1970 it declined to a mere 5.2 % between 2000and 2002. Again according to the above study, the SEZs provided emloyment to around 1lakh persons but on the other hand the Small Scale Industry sector accounted for 35% of the total direct exports and giving employment to about 200 lakh people.

Referance stuy::
SEZs: Colonisation in a New Form, Peoples March,#12, Emaculam,2006


R.S.Dahiya