Following the bifurcation of the Indian state of Andhra Pradesh in 2014, the Andhra Pradesh government announced plans to construct a new capital city, called Amaravati. The new capital city, which is estimated to take 35 years to construct, would span 217 square kilometers (53,677 acres) and host a population of 4.5 million by 2050. More than 70% of the proposed area to be used for the capital consists of multi-crop irrigated agricultural land, and is home to 29 villages with a total population of 127,505.
“Voluntary” Alternatives to Involuntary Resettlement: Threats and Intimidation
In order to transform the Amaravati area from a primarily rural, agricultural area into a modern mega-city, the government created a Land Pooling Scheme (LPS) as an alternative to involuntary land acquisition. Under the LPS, resident farmers would pool their agricultural land and transfer ownership to the State, which would develop the land in accordance with the Amaravati Master Plan. In return, farmers would receive an annuity for ten years, and up to 30% of the quantity of land pooled would be transferred back to the farmers for residential and commercial use after the land was developed.
Land pooling commenced on January 1, 2015. Although the government characterizes the scheme as voluntary, many farmers were intimidated and economically coerced into pooling their land. Tactics included setting short deadlines for participation in the LPS, which were subsequently and repeatedly extended; threats to acquire the land under the regulations of the Land Acquisition Act of 2013, which would provide compensation far below the actual market value of the farmers’ land; and threats to provide the ten-year annuity only to those farmers who signed up for the LPS prior to May 1, 2015, a deadline that was subsequently and repeatedly extended. The project raises important questions about the “voluntariness” and rights-compatibility of a scheme that provides farmers with two alternatives: pool their land or it will be acquired involuntarily.
“Voluntary” Alternatives to Involuntary Resettlement: Lack of Informed Consent
Residents in the Amaravati area were promised that the new capital city would be built around the existing 29 villages in the area, and that the villages would be left intact. World Bank documents state that the LPS “seeks to avoid any major displacement; consequently, about 25 existing villages within the 217 sq km would remain within the capital city and gradually get integrated into the urban fabric of the new Capital city.” AIIB documents state that “no displacement of population has been envisaged under the Project.” Nevertheless, the first phase of the World Bank/AIIB project is estimated to displace 236 families. 70% of people affected by the first phase of the project—10 roads and flood management works—refused to participate in socio-economic surveys in preparation for these projects. Many of these affected people participated in the Land Pooling Scheme, but object to being forced to move out of their houses to make way for the new city.
Impacts on Marginalized Groups and Workers
The implementation of the Land Pooling Scheme and the construction of the capital city has already begun to have negative impacts on marginalized groups in the Amaravati area. Landless families, who previously had reliable incomes as agricultural laborers, are now employed sporadically and struggle to support their families. Women are particularly affected.
In addition, the Dalits—lowest-caste people—are among the most discriminated against and marginalized groups in India. Under the Land Pooling Scheme, Dalit farmers receive fewer benefits than other farmers who own comparable amounts of fertile land. Further, in rural areas, Dalits often live in segregated slums, without access to adequate housing and sanitation. Dalit farmers are concerned that the allocation of developed plots in Amaravati will replicate this segregation, reinforcing and deepening societal discrimination. Dalits are also likely to face increased negative impacts of resettlement. Dalits who will be affected by the World Bank and AIIB’s first road and flood management projects have refused to participate in baseline socio-economic surveys, stating that they “do not want to move for fear of losing community power balance.”
Complaint
A group of affected community members filed a complaint with the World Bank Inspection Panel in May 2017, which raised concerns about the harassment and intimidation of farmers; livelihood impacts of the land pooling scheme; threats to food security; harms to the environment; and information disclosure and consultation. These complainants have not yet been able to bring a complaint to the AIIB’s Complaints Handling Mechanism, since the AIIB’s mechanism is still under development and does not currently review concerns about whether co-financed projects comply with its Environmental and Social Framework.
In early July, after the Inspection Panel issued a public notice of registration of the complaint, government authorities threatened to retaliate against the Requesters, who have requested anonymity due to fear of retaliation. Neither the World Bank nor the AIIB issued a public statement in response to these threats of retaliation.
The Inspection Panel deferred its decision on eligibility of the complaint in December 2017, citing commitments by World Bank management to address concerns about intimidation and impoverishment, particularly of disadvantaged residents of the Amaravati region .
In July 2019, the World Bank announced that the Government of India had withdrawn its request for financing for the project, and the AIIB made a similar announcement shortly thereafter. Following the withdrawal of the project from consideration for World Bank financing, the World Bank Inspection Panel withdrew its recommendation to investigate the project. The Panel also disclosed its third report and recommendation on the project, dated March 2019.
The Panel's third report recommended an investigation of the project, due to "remaining concerns about the Bank’s due diligence and Project design in relation to requirements of the Bank’s Involuntary Resettlement Policy." The report notes that the World Bank's independent assessment of the Land Pooling Scheme found that:
The Panel also raised concerns about proposed livelihood restoration activities, and "whether these activities amount to a robust livelihoods program that will prepare low-income, largely illiterate farmers to obtain the jobs that will be created in the new city, adapt to the urban setting and restore their livelihoods."
Centre for Financial Accountability, Amaravati Capital City Project
