Land Acquisition Problem For RIL In Haryana

Reliance Industries' Haryana SEZ Project Faces Land Acquisition Challenges

Reliance Industries Ltd (RIL), India's largest private sector company by market capitalization, is encountering difficulties in acquiring land for its planned special economic zones (SEZs) in Jhajjar and Gurgaon, Haryana. The primary obstacle stems from escalating land prices, with landowners now demanding nearly three times the amount RIL initially offered in late 2006.

RIL aims to secure approximately 25,000 acres for these SEZs. While they currently possess around 9,500 acres, acquiring the remaining land has become problematic. Landowners are demanding approximately ₹1 crore per acre, significantly exceeding RIL's notified rate of ₹38 lakh per acre (inclusive of annuity payments).

"We require around 25,000 acres for our SEZs. While we are in possession of around 9,500 acres, the owners of the remaining land are demanding around one crore rupees per acre, which is above the notified rates (the rates fixed by the company) of approximately thirty eight lakh rupees per acre (including annuity). This is a huge problem for us,” said an RIL executive, who didn’t wish to be named because he is not authorized to speak to the media.

SEZs are specialized industrial enclaves offering various fiscal and regulatory advantages. Companies seeking to establish SEZs must first obtain government approval, acquire the necessary land, and then secure official "notification" to become eligible for these benefits. RIL's initial plan involved a single SEZ in Jhajjar. However, government regulations capping SEZ size at 12,500 acres prompted RIL to propose two separate, adjacent SEZs.

This is not the only SEZ project facing challenges for Reliance Industries. Their proposed SEZ in Raigad, Maharashtra, has also encountered obstacles related to the announced rehabilitation and resettlement package. The Haryana SEZs represent a substantial investment estimated at ₹25,000 crore and include provisions for both a cargo airport and a 2,000MW power plant.

Reliance Haryana SEZ Ltd, the subsidiary tasked with developing the SEZs, has offered a land acquisition rate of ₹22 lakh per acre with an additional annual annuity of ₹30,000 per acre over 33 years, totaling ₹38 lakh per acre. This offer, however, now falls significantly short of current land valuations, creating a substantial impediment to the project's progress.