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NDA government rolled out a model Agricultural Land Leasing Act, 2016

Based on the recommendation of NITI Ayog appointed T Haque committee, government has rolled out model Agricultural Land Leasing Act, 2016. Once adopted by states, the Act will overrule any other existing Acts and would be effective from the date of notification by the respective state.

It would encourage large landowners to lease out land without fear of losing their land ownership rights and invest in non-farm enterprises (with appropriate capital and technology support)

Objective of Agricultural Land Leasing Act, 2016

  1. To promote agricultural efficiency through product diversification
  2. Alleviate poverty through promotion of off-farm activities
  3. To transfer population from agriculture to non-agriculture activities
  4. To promote occupational diversification
  5. To encourage rapid rural transformation

Provisions under the proposed Act

  1. The land owner can legally enter into a lease contract with the tenant for use of his/her agricultural land for agriculture and allied activities for a specified period for a consideration based on an agreement with terms and conditions mutually agreed by the owner and the cultivator.
  2. Under the Act, leasing of land will ensure complete security of land ownership right for land owners and security of tenure for tenants for the agreed lease period.
  3. Besides, the law provides for removing the clause of adverse possession of land in the land laws of various states and allows automatic resumption of land after the agreed lease period without requiring any minimum area of land to be left with the tenant even after termination of tenancy.
  4. It allows the terms and conditions of lease to be determined mutually by the land owner and the tenant and facilitate all tenants including share croppers to access insurance bank credit and bank credit against pledging of expected output besides incentivizing them to make investment in land improvement and also entitle them to get back the unused value of investment at the time of termination of tenancy.
  5. Under the Act, agriculture and allied activities includes
  • Raising of crops including food and nonfood crops, fodder or grass, fruits and vegetables, flowers, any other horticultural crops and plantation,
  • Animal husbandry and dairy,
  • Poultry farming,
  • Stock breeding,
  • Fishery,
  • Agro forestry,
  • Agro-processing and other related activities
  1. These activities can be undertaken by farmers and farmer groups.
  2. Farmer, according to the proposed Act, includes
  • A person who owns and cultivates land as well as
  • A person who may or may not own land but cultivates land leased from others
  1. Farmer groups include
  • Self-help groups,
  • Joint liability groups and
  • Farm producers’ organisations.

Impact on rural economy

  1. It will reduce the pressure of population on agriculture
  2. It will enable small farmers to augment their size of operational holdings by leasing in land
  3. The possibility of product diversification will enhance agri-efficiency.
  4. Income increase in rural India will restrict rural-urban migration
  5. It will also reduce pressure on courts
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