Thursday, April 05, 2007

India clearing economic zones


India to restart clearing economic zones
Source: Agence France Presse

"NEW DELHI, April 5, 2007 (AFP) -

India lifted a freeze on scores of economic zones on Thursday imposed following deadly protests, but promised there would be no forcible acquisition of land for the enclaves.

The government suspended land clearances for special economic zones (SEZs) last month following clashes between protesting farmers and the police who were sent to clear land for a petrochemical hub in the Marxist ruled eastern West Bengal state.

Fourteen people were killed when police opened fire in Nandigram, a village 120 kilometres (75 miles) south of West Bengal state capital Kolkata.

"We are not stopping any (SEZ) process," Commerce Minister Kamal Nath said.

But following the protests at Nandigram and other proposed SEZ sites, Nath told reporters "no state can compulsorily acquire land from farmers" and said the onus had now shifted onto the developers.

Instead of the government acquiring land, promoters would have to approach landowners and acquire property at commercial rates.

The government said permission would be now be given for 83 SEZs and India's Board of Approvals will consider 162 SEZs which already have initial approval, along with 140 new applications.

Approval would be given to applications where there was no land dispute, the government said. 63 SEZs have already received final clearance.

The SEZ scheme to give foreign firms Chinese-style tax-free enclaves to push industrialisation has met with massive protests from landowners.

Nath also announced a cap of 5,000 hectares (12,350 acres) for SEZs.

The farmers' protests have sparked a debate over whether farmland should be used for industry in India, where some two-thirds of the billion-plus population live off agriculture.

Prime Minister Manmohan Singh said last month that his government would not reverse plans to create SEZs although the federal government has promised to come up with a compensation package for displaced villagers.

In eastern Orissa state which borders West Bengal, 13 protesters died last January when authorities forcibly tried to clear land of tribal people.

Industry lobbies hailed the government's move, but the communists criticised it.

The Confederation of Indian Industry said it hoped it would "end the ambiguity about the future of SEZs."

The Federation of Indian Chambers of Commerce and Industry said the decision "will clear uncertainties and give a clear signal that SEZs are here to stay."

The Associated Chambers of Commerce and Industry president Venugopal N Dhoot said clearing the SEZ proposals "will accelerate economic activities for increased production and exports."

But India's Communist Party of India -- lending crucial support to the Congress-led government in New Delhi and partners of the Marxist administration in West Bengal -- slammed the decision.

"How can the empowered group of ministers take a decision in such an ad hoc manner" when a parliamentary committee is still debating the SEZ policy, a report quoted Communist Party of India's national secretary D Raja as saying.

"We do not think that this sort of ad hoc decision ... will help in any way," Raja said. "

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