ABC of SEZ

The controversies surrounding the special economic zones refuse to go, as the land acquisition and rehabilitation issues continue to haunt. Government has now decided to put on hold clearances for new SEZs until new a rehabilitation policy is in place. A Times of India editorial on the subject (Jan 20, 2007).

The Centre has been forced to put on hold clearances for new special economic zones (SEZs). The SEZ policy has attracted controversy since it was first announced in 2005. The government's reason for the present pause is that it would wait for the national rehabilitation policy to be in place before allowing new SEZs. On the face of it, it is a sensible decision since large tracts of land are expected to be acquired by the government for SEZs. This is bound to force thousands of people out of their homes and present livelihoods. In the absence of a proper rehabilitation policy, resettlement of SEZ oustees would become a tardy affair. Already, the government is facing the heat in places where land has been acquired.

The opposition to SEZs is taking the shape of a loose coalition of disparate outfits ranging from grass-roots activists, including Medha Patkar and former prime minister V P Singh, to NGOs and even Left extremists. Sections of the political mainstream, including those within the Congress, are worried about the SEZ policy. The groundswell against land acquisition has been exploited by opposition parties at the local level to target the party in office. It is obvious that the Centre would not like the SEZ policy to become a magnet for opposition parties prior to assembly elections in Punjab and Uttarakhand, which have Congress governments.

That some of the vocal opponents of the SEZ policy have been valuable allies of the UPA during the 2004 elections would add to Congress's discomfort. The trouble over the SEZ policy is another indication of the flawed nature of Indian democracy. Policies are announced by the government without carefully studying their implications. In the case of the SEZ policy, the government should have worked out a consensus with all the political parties and civil society organisations. A top-down approach to development is fraught with the danger of alienating the state from even the intended beneficiaries. It is not too late to change. In the case of projects that are land-intensive, a dialogue with people who reside and live off that land is essential. The government needs to look at them as stakeholders in the project and treat them as venture capitalists, their capital being land. Fears of home and livelihood loss have to be addressed at various levels if the necessary, and inevitable, industrialisation of the Indian economy has to happen. Before setting out to implement the SEZ policy, the government should have followed the ABC of governance; it ought to have gained the trust of the people.