Special Assistance to States for Capital Investment & Land Reforms

Overview

The Government of India has announced the Scheme for Special Assistance to States for Capital Investment 2024-25, aimed at enhancing capital investment and infrastructure development across states.

Financial Allocation

• Total Assistance:
• ₹10,000 crore for implementing land-related reforms in rural and urban areas.
• ₹5,000 crore for creating a Farmers’ Registry during FY 2024-25.

Objectives

• Boost Capital Investment: Drive economic growth and create job opportunities.
• Enhance Infrastructure Development: Improve various sectors through significant capital investments.
• Incentivize Reforms: Encourage states to implement citizen-centric and sector-specific reforms.
• Reduce Fiscal Burden: Assist states in facilitating capital investments.

Conditions and Eligibility

• Participation: All states and Union Territories are eligible.
• Performance-Based Allocation: Fund distribution is based on the effectiveness of implementing reforms and utilizing previous allocations.
• Official Naming: States must retain the official names of all schemes.
• SNA Accounts: States are required to deposit the central share of interest earned in Single Nodal Agencies (SNA) accounts until March 31, 2024, into the Consolidated Fund of India.

Key Features

• Interest-Free Loans:
• Financial assistance is provided as 50-year interest-free loans for capital investment projects, with a total allocation of ₹1,30,000 crore for FY 2024-25.
• Multiple Parts:
• The scheme is divided into eight parts, with Part-I receiving ₹55,000 crore allocated based on states' shares of central taxes as per the 15th Finance Commission.
• Other parts focus on reforms or specific sectors, such as urban planning.
• Milestone-Linked Reforms:
• A portion of the assistance (₹75,000 crore) is tied to the completion of specific reforms to foster a competitive spirit among states.
• Flexibility in Project Selection:
• States can choose projects within approved sectors according to their needs.
• Conditional Fund Release:
• Funds are released in tranches based on progress in reforms and project implementation.
• Focus on Productive Sectors:
• Emphasis on sectors like health, education, irrigation, water supply, power, roads, bridges, and railways to enhance productivity and quality of life.
• Monitoring and Evaluation:
• Regular evaluations by the central government ensure effective fund utilization and timely project completion.

Promises on Land Reforms Made in the Union Budget 2024-2025

Key Initiatives

• Digitization and Modernization of Land Records
• Unique Land Parcel Identification Number (ULPIN): Assigning a unique identifier (Bhu-Aadhaar) to all land parcels.
• Digitization of Cadastral Maps: Ensuring accurate and up-to-date land records.
• Digital Public Infrastructure (DPI) in Agriculture: Aiming to cover all farmers and their lands within three years.
• Improved Land Administration
• Streamlined Land Transaction Processes: Reducing delays and costs associated with land transactions.
• Reduced Land Disputes: Enhancing transparency in land records to minimize conflicts.
• Enhanced Land Governance: Ensuring equitable access to land resources.
• Technological Interventions
• Satellite Imagery & GPS with GIS Mapping: Promoting accurate land surveys and mapping.
• Digital Platforms: Facilitating land transactions and access to land records.

Significance of Land Reforms

• Economic Growth & Reduced Conflict: Improved land productivity and investment opportunities can lead to greater stability and peace.
• Social Justice: Addressing inequalities and empowering marginalized communities.
• Environmental Sustainability: Encouraging sustainable practices to protect land and biodiversity.
• Improved Governance: Enhancing transparency and accountability in land management.

Challenges to Implementation

• Resistance from Landlords: Fear of losing power can hinder reform efforts.
• Political Gains: Short-term political interests often overshadow sustainable development goals.
• Implementation Challenges: Bureaucratic delays and lack of resources may impede effective reforms.
• Existing Land Disputes: Complications arise from unresolved disputes before new systems are implemented.
• Social and Cultural Barriers: Inequalities can exclude marginalized communities from benefiting.
• Financial Constraints: Significant investments are needed for effective implementation.
• Technical Challenges: Issues with geographic data and mapping projections can hinder progress.

Historical Context of Land Reforms

• Abolition of Zamindari System (1950s): Transferred land ownership to tillers to empower farmers.
• Tenancy Reforms (1950s): Protected tenant rights and capped rents to ensure secure tenures.
• Land Ceiling Acts (1960s-1970s): Limited landholdings to promote equitable distribution and agricultural productivity.
• Forest Rights Act (2006): Recognized rights of forest-dwelling communities for sustainable management.
• Digital India Land Records Modernization Programme (DILRMP): Created a transparent digital record to reduce disputes and facilitate transactions.
• Unique Land Parcel Identification Number (ULPIN) (2021): Improved land management through unique identification.
• Technological Initiatives: Introduction of GIS applications like "Gram Manchitra" and mobile solutions for geo-tagging.

Conclusion

The initiatives outlined in the Union Budget 2024-2025 aim to modernize land management, improve governance, and promote economic growth while addressing historical injustices and environmental concerns. However, significant challenges remain, necessitating a coordinated effort among stakeholders to ensure successful implementation.