Special Economic Zone in Tamilnadu

Special Economic Zone in Tamilnadu, India By Dr. Srinivasan and Mr. Alagarswami “The protests against land grab for SEZ’s have spread like wildlife. ” Vandana Shiva ( 2007). The overarching problem this study tries to address is the question why the wild-fire of protest spreads in some regions, while in others it is either doused living behind a dying ember or perceived not as a fire but as a well spring of hope. What can explain the regional differences in public responses to SEZ?
The state of Tamil Nadu has been proactive in implementing SEZ policy both at the regional level as well as at the central policy levels. Mukherji and Shivpuri Singh argue that “the Act has made partial progress towards evolving a procedure for single window clearance of SEZ projects. Issues such as labour regulations; skill shortages; land acquisition; environmental clearance; power availability; a developer’s powers with respect to town planning; transport linkages; access to finance; corruption; and the overall propensity to approve foreign direct investments will have a state-level component.
In most of these cases, state-level SEZ Acts will determine the extent to which state-level policies are synergised with central policies”(Mukherji and Shivpuri Singh, 2006). Even before the central SEZ Act was passed in 2005, Tamil Nadu had formulated its policy on SEZs in 2003 and passed the Tamil Nadu SEZ Act in 2005. Since 2005, a series of public hearings were organized by various civil society groups, political parties and government agencies. Civil society groups have argued that the bulk of the land being acquired for SEZs is fertile agricultural land, especially in case of the multi-product zones.

The state of Tamil Nadu(TN) one of the four southern states of Indian sub-continent is considered “a pioneer in implementing many developmental programs such as nutrition noon-meal scheme for school children, integrated rural development program, adult-literacy programs, Rs. 1 (4. 7 cent) per kilogram of rice for poor, and more recently self-help group based micro-finance initiatives. It has also been a forerunner in implementing industrial policy focused on small scale industries and marginally successful land reform that sought to distribute land to landless farmers.
Tamil Nadu has followed a unique trajectory that blended industrial policy and developmental initiatives, which have withstood the vagaries of local politics, corruption and other malaises that have been traditionally associated with governance in India. ” (Ref)Tamil Nadu, being among one of India’s most industrialised states, shows certain unique patterns emerging in the establishment of SEZs. The Indian SEZ model was most widely adopted in the state with both negative and positive fallouts.
Even before the central SEZ Act was passed in 2005, Tamil Nadu had formulated its policy on SEZs in 2003 and passed the Tamil Nadu SEZ Act in 2005 (Dhurjati Mukherjee, 2007). With 122 notified and proposed Special Economic Zones (SEZs), Tamil Nadu boasts of maximum number of SEZs in the country after Andhra Pradesh and Maharastra. Two large and powerful state agencies State Industrial Promotion Corporation of Tamil Nadu Ltd (SIPCOT) and Tamil Nadu Industrial Development Corporation Ltd-(TIDCO) exercise considerable influence and authority in the acquisition of land.
The government is intent on pursuing a policy of aggressive industrialisation, especially of a capital-intensive nature and has proposed to create 10,000 acres land bank in the state as per the 2007 Industrial Policy (TN Industrial Policy Note, 2007). Till date the state has 44 notified, 66 ‘formally approved’ and 19 ‘in-principally’ approved SEZs. Proposals are pending for another 13 SEZs. With over SEZ 54 approvals, State of Tamil Nadu (TN) has one of the highest numbers of SEZs in the country.
In Tamil Nadu, 55 SEZs have been approved with 13045 hectares (32,235 acres) of land as of 2012. In response to the opposition to SEZ in some localities (see chapter on Discourse Analysis for details) as well as in response to national developments in places like Nandigram, where the opposition to SEZ had turned violent, in 2007 , Tamil Nadu released the new industrial policy and announced several measures aimed at mid-course corrections as well as aggressive promotion of SEZ. For example the policy supported the evelopment a land bank of 4,000 hectares to promote industrial development in the state. The new industrial policy announced plans to build a land bank of 10,000 acres eventually to meet the growing demands for SEZ or industrial parks. The state has explicit policy of not acquiring cultivable land. The land for private parks / SEZs should, as far as possible, be barren, non-irrigated and dry land and the government will not allow proposals for industrial park involving more than 10 per cent cultivable land.
Tamil Nadu was also the first state to make it a policy to support voluntary acquisition of land, rather than forcible acquisition. The policy also stipulates that promoters of private industrial parks would be required to purchase land directly. In its 2007 policy, the state government said that 10 per cent of the area in new industrial parks promoted by the State Industries Promotion Corporation of Tamil Nadu (SIPCOT) and the Tamil Nadu Industrial Development Corp (TIDCO) would be set apart for social infrastructure.
According to the new policy, in order to have equitable regional development, proposals for special economic zones (SEZ) in industrially backward areas will be given priority. 20 per cent of the allot-able area in new industrial parks / special economic zones (SEZ) or expansion of existing ones promoted by the Sipcot / Tidco would be reserved for small and medium enterprises (SME) including SME vendors to major industries in the same park.
The consequences of 2007 industrial policy were that there was a tremendous increase in applications for SEZs. The speed at which the state government has been sanctioning the projects has raised several questions. There were apprehensions and widespread resistance from the farmers, politicians and academicians towards the implementation of the policy in Tamil Nadu. Opposition to SEZ in TN There are growing concerns over the impact of SEZ on local communities such as loss of agricultural land, unfair land transactions, undermining of uthority of local government, environmental degradation and fears of emergent gated communities. The feasibility and profitability of SEZ are also being re-evaluated in the light of growing opposition to SEZ and volatile markets. There have been several cases of reported opposition to SEZ, but many of these issues were eventually settled. Highlighting numerous instances of speculative land-bank acquisitions, the protestors condemned the Government for targeting the most vulnerable sections with eviction.
Acquisition of bhoodan land Oragadam (Sriperumbadur), panchami land in Cheyyar (Thiruvanamallai), saltpan land in Ennore (Thiruvallur), grazing land in Thervoy (Thiruvallur), tenancy land in Nanguneri (Tirunalvelli), multi-cropping agriculture in Hosur (Krishnagiri), Sivarakottai, Puliampatti, Swamimallmpatty (Thirumangalam), Ranipet and Panapakkam (Vellore), agriculture land and homesteads in Mangal (Thiruvanamallai) are some examples of controversy over land acquisition in Tamil Nadu.
Even though local people participated in protest against land acquisition, these protest did not materialise into any concrete action as it had happened in other states. The government of Tamil Nadu commissioned a report to examine the claims of those opposing the SEZ. Civil society organisations held several public hearing on the impact of SEZ in Tamil Nadu. In the public hearings, several critical questions were raised: Are people willingly giving away their land? What is the process of land acquisition in the state?
What role does the government agencies like Industrial Promotion Corporation of Tamil Nadu Ltd (SIPCOT) and Tamil Nadu Industrial Development Corporation Ltd. (TIDCO) play in acquiring land for private companies? The loss of agriculture land, accompanied by livelihood insecurity has been on the raise for over a decade in TN. As per official figures, Tamil Nadu has lost more than one million hectares of cultivable land between 1991 and 2003 (Government of India, 2007 Agriculture Statistics at a Glance 2006-2007. Ministry of Agriculture).
The government itself does not know how much agriculture land has been diverted till date as has been made clear by the Planning Commission’s July 2006 report of the Working Group on Land Relations for the11th Five Year Plan. The Ministry of Commerce, government of India does not provide any information on the livelihoods lost as a result of creation of SEZs. At the public hearings the verdict was that the bulk of the land acquired for SEZs is fertile, agricultural land, especially in case of the multi-product zones. A special report on SEZ in Tamil Nadu prepared by Dr.
Palanithurai(Palanithurai,2009) makes an attempt to document issues related to land acquisition and peoples opposition to SEZ. The report is extensively based on case studies and interview based evidences to make an argument against SEZ. Especially the report focused on the issue of acquiring cultivable land for SEZ, against the government’s own commitment not to acquire fertile lands. The report refers to authoritarian strategies adopted by the government to force local Panchayats to pass resolutions in favour of SEZ.
The report cites the example of SEZ at Cheyyar in Thiruvannamalai wherein the Mathur Panchayat passed a resolution objecting to land acquisition, expressing unwillingness to part with common lands. Similar resolutions were passed in Gram Sabha against land acquisition in eight Village Panchayats. The question that is asked was: “Will Cheyyar be Tamil Nadu’s Nandigram? ” (Palanithurai, 2009). But the issue in Cheyyar took a different turn with many local people settling for a land sale and Panchayats now co-operating with the government and the promoters. Is this a case of coercion or voluntary agreement?
The report presents the case of Irunkattukottai near Sriperumbudur and Hundai car manufacturing plant in Kancheepuram district, Valasamudram,in Tuticorin District as examples of opposition to SEZ. In the case of Bairamangalam near Hosur in Krishnagiri district local opposition to acquire cultivable land lead the government and private promoters to withdraw the project (Palanithurai,2009). Perhaps the case that drew much media attention was Oragadam village near Chennai, where the claim was that out of the 950 acres nearly 300 acres were cultivable land (Palanithurai, 2009). However as the development of SEZ ontinued, the opposition soon melted. One reason was that the agricultural land has been in the process of being re-developed as real estate since early 1990s and thus many of the land claimed to be cultivable were already being reclassified as housing development property—a move encouraged by the government to meet the growing demands for properties in close to Chennai. Villages in another districts lose to Chennai, Chengulpet was already a highly valued real estate’s with many educational, religious organisations already in position of large tracks of fertile land ready to be reused for non-agricultural development.
The report also sites examples of SEZ that had little or no oppositions. “Perambalur District Perambalur is one of the districts in Tamil Nadu . “Contrary to the stories of land grabbing and bureaucratic compulsion that reeled off about land acquisition in many other districts of Tamil Nadu, people in Perambalur had altogether a different story to narrate… The entire process of land acquisition was smooth, and the local community had no discontentment – not even a speck of disapproval, about having lost the land (Palanithurai, 2009). Despite such variable and mixed responses the report concludes by stating that “If at all, SEZ should do some good to the local development: (i) let it get established in real barren lands based on actual surveys carried out in identified regions, and not as per the British period records in possession of the government; and (ii) the community unrest in SEZ can be avoided, if the National Policy on Rehabilitation and Resettlement 2007 was taken as guidelines for resettlement and rehabilitation of people affected” (Palanithurai, 2009).
But more tellingly the report presents rather dramatic description of “eviction of people, leveling of houses, handling over the land to the SEZ developers. and paying cash compensation to those who part with lands” and concludes that “The current tendency of making steadfast move towards eviction of people… would only cause damage to agriculture, mock grassroots level democracy, and aggravate poverty”.
These observations in the report have exclusively relied on the people who have lost their land and have grievances against the compensation packages. The report draws its conclusions based on selected individual case studies and incidents of few clear opposition to SEZs/ But what about the other stakeholders. Does SEZ have an impact only on those who lose their land?

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