Welcomed by leading industrial houses, the policy provides for land acquisition up to 30 per cent by states to give a crucial contiguity to the developers - be those of special economic zones or industrial projects.
The National Policy on Rehabilitation and Resettlement, 2007, which was cleared at a meeting of the Union Cabinet chaired by Prime Minister Manmohan Singh, provides for land-for-land compensation, besides preference to affected families for jobs in projects coming up on their plots.
"The policy of the previous NDA government was disastrous as it did not take into account the interest of farmers," Information and Broadcasting Minister P R Dasmunsi said after the Cabinet meeting.
The new policy seeks to make those entitled for compensation stakeholders in development by allowing them to take up to 20 per cent of the amount in the form of shares if the acquiring entity is authorised to issue these instruments.
"With prior approval of the government, this proportion can be as high as 50 per cent of the rehabilitation grant and compensation amount," the Rural Development Ministry said.
The policy discourages speculative transactions of land acquired for public purposes. As a relief for developers, 30 per cent land can be compulsorily acquired by states for the promoters while the rest has to be bought by them.
Reliance Industries which is in process of acquiring land for its mega SEZs welcomed the policy. "The policy will boost the industrial development as it clearly defines the land acquisition rules," a Reliance spokesman said.