Public Wealth Wiki

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Public Wealth Wiki

India has enormous public wealth. This is the wealth that is owned by the people and controlled by the government. The Union, State and local governments in India own massive amount of wealth directly or through various public-sector enterprises, ownership of mineral resources, control of airwaves and ownership of marine resources within territorial waters of India.

Only the mineral resources of India have been estimated to be worth more than ₹5000 lakh crores of wealth according to analysts. This sum is equivalent to over ₹40 lakh per person in India. Apart from that, there are thousands of acres of land parcels controlled by the government. By our estimates, the known public wealth of India is over ₹1340 lakh crore, which equals to over ₹50 lakh per Indian family. This figure is from a very conservative estimate of the wealth of the people. We have only taken 20% of the mineral wealth of the country in the account for arriving at the number. In addition, the undiscovered public wealth of India is yet to be categorised and valued. Except for defence and railways, most other ministries and departments of the Union Government do not even know how much of land and resources they own. While some of the public resources are being used to support essential government services, most of them are lying idle across the nation due to gross misuse and poor management. All governments in India, be it central, state, or local, have contributed to the degradation of resources belonging to the people. When millions of our compatriots live in abject poverty, such a situation is unacceptable. It is important to note that even though public wealth includes common resources such as roads, government offices, airports, etc. we have not included those resources in the Public Wealth Wiki.

Background

Historically, the ownership of public wealth belonged to the kings in India and most other parts of the world by the invocation of the divine rights or through means of coercion. Presently, the rights over the public wealth belong to the democratically elected Indian government, which is obligated under the constitution to use this wealth for public good.

Ancient India

In ancient India, even though the Kings represented the State, the mineral wealth did not vest in them. They were only entitled to receive the taxes or revenue form the production or extraction of minerals. Simultaneously, the ownership of other public resources such as forests and water bodies were shared by the community which relied on them. However, the ownership of mineral resources gradually transferred to the state beginning with the empire of Chandragupta Maurya, particularly as Kautilya justified state monopoly over mineral resources in his seminal work Arthasastra. The ownership of resources other than minerals, such as forests and water bodies, continued to be with the kings or the community in one form or the other across India till the arrival of the British East India Company.

British India

The British East India Company started using the power of the state to acquire private property for public use as early as 1824 in Bengal and other parts of India. The Bengal Regulation I of 1824 allowed the Company to obtain private properties by paying a fair price for construction of “roads, canals, or other public purposes” when the Company only had limited rights related to taxation and trade as per the powers bestowed on it by the British Crown. Thus, all acquisitions conducted under the Bengal regulation and similar laws in other parts of India were patently illegal until 1857 when the British Crown took over control of India. Following that, the British acquired most of the natural and mineral resources of India; either by acquisition with meagre compensation or by coercion. Concurrently with the British rule, different princely states in India adopted similar policies with respect to the ownership of public wealth. While some states adopted the state’s ownership of public wealth, others bestowed the ownership to the community. Some states neglected the issue altogether and adopted a non-property attitude towards public wealth and kept it as commons, particularly in case of forests and water bodies.

Modern India

The Constitution of India bestows the ownership and control over using resources is in hands of the central and state governments under various articles. However, individuals and corporations can make use of the public resources under a license from the government. Since independence, there has been no concrete effort by the central or the state governments to define public wealth or regulate the same in a meaningful manner, instead the governments have chosen to deal with the issue on an ad-hoc basis. Noting the same, the Hon’ble Supreme Court, while announcing the judgment on 2G scam in 2012, observed – “no comprehensive legislation has been enacted to generally define natural resources and a framework for their protection.” Given the constitutional provisions, the Indian state is the trustee and legal owner of the public wealth of India under the doctrine of public trust, which "enjoins upon the Government to protect the resources for the enjoyment of the public rather than to permit their use for private ownership or commercial purposes". Natural resources belong to the people, but the State legally owns them on our behalf.

Public Wealth of India

Land

Land is an essential resource in the economic life of a nation. Without land, no economic activity can take place. Land is a limited resource, we cannot create more land. The term 'land' includes all physical elements in the wealth of a nation bestowed by nature; such as climate, environment, fields, forests, minerals, mountains, lakes, streams, seas, and animals. Given the lack of clear titles and records, no one knows how much land is owned by the government and how much of it remains under encroachment. Only marginal progress has been made on that front in recent years by the Union Government.

Defence

The Ministry of Defence is one of the biggest landholder in India. It holds of 17.31 lakh acres of land. A lot of this land is vacant and unused. As per the CAG Report, the Ministry has 81,000 acres of surplus land nationwide. Out of that, almost 15,000 acres of land is in major urban centres such as Chennai, Bangalore, Pune and Mumbai. Proposals to rationalize the use of Defence lands are highly sensitive. Most policy discussions treat Defence property as off limits when it comes to identifying surplus landholdings. This view is prudent in the short-run. Identifying surplus property in other central-government institutions is likely to be less controversial and meet with less powerful resistance. However, over the longer term, the perspective changes. Defence holds the largest blocs of urban land. Some of this land is inefficiently located for Defence purposes. Some is now used for non-Defence activities. Other countries have included Defence property in their assessments of efficient public land use. In fact, Australia, Canada, United Kingdom, United States, and the Philippines all have found that more than 90% of total public land identified as surplus and monetized has come from outdated military bases. In many cases decommissioned military bases have become the anchor sites for large-scale, successful urban redevelopment. India at one-time audited Defence lands to find parcels that were permanently surplus for military use. It therefore is useful, in assessing centrally-controlled lands, to consider Defence property. The Ministry of defence has 97 golf courses covering 8,076 acres of mostly urban land. Golf courses are not authorized uses on A-1 Defence lands. To avoid the charge of having surplus recreational land, the Army in 2004 relabelled its golf courses as Army environmental parks and training areas. The CAG report dryly notes that there is no evidence that the relabelled golf courses are designed for maintaining ecological balance. Some Defence lands are allocated to favoured parties under legacy leases at far below market rates. The Agra (Golf) Club occupies 17.68 acres for which it has paid annual rent of Rs 58.92 per year since 1992. The racetrack in Pune Cantonment has been leased to Royal Western India Turf Club since 1902. The lease is for 65.15 acres, but over time the Club has expanded onto an additional 24.1 acres of Defence land without sanction. Other lease arrangements have been the subject of recent scandal. The Adarsh Society scam and the Srinagar Airport scam are two examples of alleged collusion between local military officials, bureaucrats, politicians, and developers. Through a series of manoeuvres, Defence land was re-classified as civilian land. No Objection Certificates then were issued to private developers to authorise construction of luxury high-rise buildings in prime locations.

Railways

Indian Railways is a public enterprise owned by central government and administered through the Ministry of Railways. The total area of land under Railway network is 4,61,487 hectares out of which 4,14,240 hectare is under operational and allied use and 46,333 hectare land is vacant. A huge amount of land under railways, is given to Railway Land Development Authority (RLDA). The authority has nearly 55,910 acres.

Minerals

The total value of the mineral resources of the country is estimated to be ₹5000 lakh crore. However, this number is highly conservative. The central or state governments do not have a dedicated database which lists all the resources under their control with the appropriate market values. The number also excludes the unexplored resources and spectrum under control of our governments. The number was calculated by using data available in public domain by the Centre for Budget and Governance Accountability, a public-policy think tank based in New Delhi. The calculation only includes – i. Stocks of hydrocarbons in the country such as coal, lignite, crude oil, natural gas, etc. and ii. Major mined and mineral resources stock in the country.

Public Sector Undertakings

The 298 central public-sector enterprises (CPSEs) including many closed units own vast parcels of land across India. The unused parcels, which are often in city centres, could be repurposed for educational institutions, infrastructure projects, health facilities, affordable housing, urban forestry, or even roads. Preliminary surveys show that just 58 CPSEs hold about 2.38 lakh acres of unused land. Officials point out that most PSUs would have an average of 200-400 acres of land, while some may have over 1,200 acres. There is no concrete data on surplus land with the 298 CPSEs and under various ministries. But their value is estimated to be in lakhs of crores. Vijay Kelkar’s study of CPSE land had estimated ₹22,000 crore worth of surplus land in Ahmedabad alone in 2010-11.

Case Studies

Delhi Development Authority

A survey conducted for the first time regarding the DDA-administered land in the city with the help of National Productivity Council and Geospatial Data Limited. The survey included plots under various land uses such as industrial, commercial, and recreational. The focus behind the survey was to protect these plots from illegal encroachment. The survey found that 5,484 acres of land under DDA was lying vacant. The survey also found that 298 acres of land under DDA was under litigation. The total area of New Delhi is around 10551.4 acre out of which 5,484 acres of land under DDA is vacant. Which means about 50 percent of total land in New Delhi is lying vacant with DDA. The value of total vacant land under DDA is worth 1 lakh crore.

Bharat Sanchar Nigam Limited

The Bharat Sanchar Nigam Limited (BSNL), holds vast tracts of land across India. According to the report number 17 of 2014 of the Comptroller and Auditor General (CAG) of India, BSNL hold huge tracts of land from the Department of Telecommunications in the year 2000. The Company does not however have a laid down Land Management Policy (May 2013). Procurement of land is carried out by the authorized functionaries as per the delegation of Financial powers of the Company. PGM (BW) which heads the Civil Wing of the Company at Corporate Office is mandated to maintain the database of the land bank of the company. As per details of land holdings contained in the MIS (Management Information System) maintained by the Civil Wing, the total number of plots, area of the plots, freehold/leasehold, cost of acquisition i.e. book value, present value, lease period etc., Circle-wise and SSA-wise, in respect of 44 out of 451 circles of the company was available as on 26 September 2012. The Company inherited from the DoT 12194 plots 3 measuring 406.31 lakh square meters with book value of `3103.03 crore located at various places. After formation of BSNL, the company had acquired/ taken on lease 2788 plots measuring 34.5 lakh square meters with book value of `380.41 crore. Thus, the total book value of the land as per the MIS data of Civil Wing was `3483.44 crore. As on 31 March 2012, the Company had 1953 plots with freehold rights measuring 32.46 lakh square meters kept fully vacant across the country in 29 circles. 1719 plots measuring 27 lakh square meters in selected 15 Circles were kept fully vacant out of the total freehold plots of 1135215 measuring 307.82 lakh square meters. In 25 out of selected 67 SSAs under 15 Circles, Audit observed that 119 plots covering an area of 1.70 lakh square meters with a book value of `7.60 crore were lying vacant (March 2012).

Air India

In the Union Budget 2017-18, Arun Jaitley announced government’s plan to monetise land bank held by Airport Authority of India which is the third largest landowner in the country after armed forces and railways. As per a document from the Geological Survey of India, several residential and commercial plots owned by Air India have been put up for Auction. These plots are mostly located in prime locations, with high values, with a consolidated area of about 92 acres. To generate revenue, Air India has finally started monetising its surplus land.

State Industrial Development Corporations

The Industrial land comes under the jurisdiction of the state governments. In India, the vast tracts of industrial land under the State Development Authority is lying vacant. Rajasthan State Industrial Investment & Corporation Limited (RIICO), is premier agency of Rajasthan Government. RIICO is primarily engaged in site selection and acquisition of land, it provides financial assistance to small and medium enterprises. RIICO has 27 offices in Rajasthan and has developed 338 industrial areas by acquiring 59,084 acres of land Rajasthan State Industrial Investment & Corporation Limited (RIICO), has 1308.87 acres of vacant industrial land in Rajasthan. State Infrastructure and Industrial Development Corporation of Uttarakhand Limited (SIIDCUL), is Government of Uttarakhand Enterprise which integrated as a limited company in the year 2002 with an authorized share capital of 50 crore and 28. 50 crores paid-up capital through the Government of Uttarakhand to foster industrial development in the state. SIIDCUL has a widespread of Industrial Estates holding huge tracts of unused land. The total area of industrial vacant land under SIIDCUL is 1820 acres. Bihar Industrial Area Development Authority (BIADA), is a statutory organization under the provision of Bihar Industrial Area Development ACT 1974, with a mission to promote infrastructure for Industrialization of the state. There are 50 industrial areas under 4 regional offices Patna, Bhagalpur, Muzaffarpur and Darbhanga. The total area of vacant industrial land under BIADA is 178.91 acres. Uttar Pradesh State Industrial Corporation Limited is a public-sector undertaking of Government of Uttar Pradesh. The Corporation since last 56 years is functioning to promote the industrial development of the state. The corporation hold unused land of 1487 acres.

Special Economic Zones

According to Report number 21 of 2014 of the Comptroller and Auditor General of India (CAG) on Performance of Special Economic Zones (SEZs), below are some instances of how the land allotted for SEZs was misused and diverted. This is especially important in the light of the discussion happening around the Land Acquisition Ordinance of the NDA government. Diversion of SEZ land for commercial purposes: 14% of land i.e., out of 39245.56 hectares of land notified in the six States10, 5402.22 hectares was diverted for commercial purposes after de-notification. Many tracts of these lands were acquired invoking the ‘public purpose’ clause. Thus, land acquired was not serving the objectives of the SEZ act. This is one of the fears with the new Land Acquisition Ordinance. How does the Government ensure that the land acquired is not misused by private parties? According to the CAG, out of the 392 notified zones, only 152 have become operational. In various states, the Developers had not commenced investments and the land had been lying idle in their custody for 2 to 7 years.

Port Trusts

The top 12 state-owned ports have 77,191.14 acres and an additional 1.98 lakh acres of submerged land. However, the title deeds for 34,943.41 acres—or 45.27 per cent of the ports’ total landholdings—are still missing.

Hindustan Aeronautics Limited

HAL was established as Hindustan Aircraft Limited in 1940 and have its headquarters in Bangalore. In the year 1963, the State Government of Odisha allotted 12,000 acres of land belonging to 11 village to HAL. HAL has allotted 6,000 acres of land to Central University of Odisha and Cobra Battalion. Now, 2918.53 acres of land under HAL is vacant in Bhubaneshwar. In Koraput, Odisha out of 3,121.15 acres of land under the HAL 50.21 acres is encroached by the local villagers for more than 25 years.

Delhi Urban Shelter Improvement Board

The Delhi Urban Shelter Improvement Board, functions under the control of the Government of NCT under the preview of DUSIB Act 2010. DUSIB is majorly responsible for improving the quality of slum and JJ dwellers. DUSIB implement schemes on the behalf of New Delhi government. There are 30 lakh people in the city living in around 6 lakh jhuggies which social infrastructure is deteriorating, which is a grave concern. The DUSIB has 102.93 hectares of vacant land available in JJR Colonies, and 918 square metres of vacant land in Nand Nagri, Village Mandoli in New Delhi.

Department of Posts

The Department of Posts is a government operated posted company. The Postal Company comes under Department of Posts which is the part of Ministry of Communications. According to the CAG report Union Government (Communication and IT Sector) for the year 2016, the scrutiny of records from December 2015 to January 2016 in 20 postal circles (states) disclosed that 1,608 free-hold plots measuring 48.08 lakh sqm which were purchased in past (even in 19th century) for the purpose for constructing postal offices and staff quarters were lying vacant. The possession cost of 980 free-hold plots was 77.03 crore and the information was not available for the remaining plots. It was observed that the current value of 472 vacant plots measuring 6.77 lakh sqm in the states such as Andhra Pradesh, Karnataka, Odisha, and Maharashtra had risen to Rs 209.55 crore (December 2015) from the actual acquisition cost 4.33 crore. The 19 out of 22 circles (states) from the scrutiny of records (December 2015 to January 2016) disclosed that 241 free hold plots measuring an area of 3.24 lakh square meter with the purchasing cost of Rs 13.94 crore were encroached. Therefore, the current value of 107 encroached plots with 76,683 sqm as provided by the six circles, had risen to Rs 63.90 crore from its original value of Rs 3.59 crore. Scrutiny of land records made available to audit (December 2015 and January 2016) revealed that in 16 Circles out of 22 Circles, 100 plots measuring 4.08 lakh sq. meter acquired on lease for construction of post office buildings/staff quarters, as far back as in 1978, were still lying vacant and an amount of ` 3.37 crore during the period up to 2014 was paid towards lease rent .It was further observed that in Delhi Circle alone, 19 plots measuring 53,137 square meter taken on lease of ` 2.37 crore during 1983 to 2014 were still lying vacant without any use. In Mumbai Postal Region alone, nine plots measuring 16,597 square meters taken on lease during 1984 to 1992 were still lying vacant.

Methodology

Land values and Floor Space Index

The Floor Space Index (FSI) is the ratio between the area of a covered floor space (built-up area) to the area of that plot on which a building stands. An index of 1 implies that the total covered floor space is 1000 Sq. Ft. on a plot of 1000 Sq. Ft. The Floor Space Index in New Delhi ranges from 1.2 to 3.5 meaning that 1200 to 3500 Sq. Ft. of floor space is available for every 1000 Sq. Ft. plot there. All the value of unused public land is calculated based on the FSI value of 1. The rates for the land have been calculated as per the

Minerals

The estimated values of the mineral resources are based on a detailed study done by the Centre for Budget and Governance Accountability, a think-tank based in New Delhi, in 2014. The author of the report has mentioned that he calculated the value of minerals based on the information from the public domain from various governmental and non-governmental agencies.

Land

The data on the unused public lands was collected by researchers at Free A Billion from authoritative governmental and non-governmental sources. These sources include Parliamentary Questions,