Compensatory Afforestation Bill

Introduction of the Compensatory Afforestation Fund Bill in the Indian Parliament on 29th April 2015 is the biggest development in the forestry sector in India. The bill seeks to provide an institutional mechanism, both at the Centre and State, to manage the funds under the public accounts of India collected from user agencies diversion of forests land for non-forestry purposes under the Forest (Conservation) Act, 1980[1]. The bill proposes to constitute authorities and a Compensatory Afforestation Fund (CAF) at the national level and at each of the State and Union territory Administration for administration of the funds collected by state governments in lieu of forest land diverted for non-forest purposes and to utilise the funds collected for afforestation activities[2].

It is well known that as of date over Rs. 38,000 crores are lying unspent in the ad hoc Compensatory Afforestation Fund and there is a fresh accrual of compensatory levies and interest on accumulated unspent balance, which  is of the order of approximately Rs. 6,000 crore per annum”[3]. Given the huge sum of money accruing in the fund and the potential impact that effective management of the funds could have on the forests, forest dwelling communities in the country and help meet India’s targets for climate change, the provisions of the bill vis a vis its management, utilization of the fund and more importantly the manner in which it visualizes regeneration of forests in India become crucial.

The overall structure proposed by the bill are two separate funds: one at the national level known as the Nation Compensatory Afforestation Fund (NCAF) and one at the level of each state, known as the State Compensatory Afforestation Fund (SCAF). These are to be backed by national and state authorities, constituted under the Act and a national level monitoring agency. One of the notable features of the bill is that there is provision for direct crediting of funds collected into the state accounts, without routing them through the Central Fund. However, at the same time, the bill also proposes a strong Central Government control over the fund management and its utilization.

[1] These include funds collected for compensatory afforestation, additional compensatory afforestation, penal compensatory afforestation, net present value, undertaking activities related to protection of biodiversity  or wildlife and all other amounts recovered from such agencies under the Forest (Conservation) Act, 1980

[2] These, as per the Bill, include “artificial regeneration (plantations), assisted natural regeneration, protection of forests, forest related infrastructure development, Green India Programme, wildlife protection and other related activities and for matters connected therewith or incidental thereto”.


(Blogger: Suparna Jain)


Land Acquisition Ordinance: The Current Status

In a sudden turn of events, there might be a possibility of the opposition Congress to score a victory in the Land Acquisition Bill controversy that sparked debate last December. While giving in to the demands by Congress and TMC members for more time to study certain clauses threadbare, Former Union Minister and BJP Lawmaker S S Ahluwalia, panel Chairman for the Joint Committee of the Parliament, decided that the Committee should not submit its report in this session ending on 13th August and instead do so in the first week of the Winter Session. The meeting on 10th August was expected to evolve consensus on three key provisions including the one on return of unutilised land to its owners after five years and the retrospective clause. However, only the retrospective clause was taken up briefly during which the Congress members vociferously opposed any change in provision 24 (2) of the UPA Act, which has been diluted in the NDA Bill.

The Government, on the other hand has now come around to the view, after consulting legal experts that that there is actually no need for any drastic change to the 2013 law.

Legal experts have brought to the notice of the Govt., a drafting error or mere oversight which has left a significant chink giving a considerable leeway to industry. The UPA’s controversial LARR 2013 does not make consent mandatory for land acquisition, as Sec. 2(1) of the Act provides for land acquisition, compensation, rehabilitation and resettlement but clearly skips the word ‘consent’, which is mentioned in Sec. 2(2). Consent is not only missing from this crucial provision but also the extent of consent required, as elaborated in detail in Section 2.2[1] of the Act, is not mentioned.

The government reckons this means land can be acquired under this provision for all infrastructure sectors notified by the department of economic affairs barring private hospitals, hotels and educational institutions. Thus land required for agro processing industries, projects for industrial corridors, national investment and manufacturing zones and housing can be acquired sans prior consent, as per the government’s latest interpretation of the 2013 Act. Thus, effectively government can acquire land and while keeping the ownership with itself lease plots for development of industry.

Interestingly, a way out has also been provided by Section 109 of the Act by allowing “appropriate government” to make rules by way of notifications with regard to provisions of the Act including consent and social impact assessment.

This means, as per the fresh legal opinion received by the government, that states have the power to make rules accordingly.

[1] Section 2.2 of the Act specifically mentions requirement of consent while also elaborating on the extent to which it is required. In the case of private companies, consent of at least 80% of land owners will be required while in case of public private partnership projects at least 70% of Consent of at least 80% of land owners will be required while in case of public private partnership projects at least 70% of consent is must.

(Blogger: Suparna Jain)