India passed an urgent executive order yesterday to ease land-acquisition rules in sectors such as power, housing and defence to kickstart hundreds of billions of dollars in stalled projects.

Restrictions on buying land, under a law championed by the last Congress government, are among barriers holding up projects worth almost $300 billion.

Several states had asked prime minister Narendra Modi to overhaul the law enacted in January. Finance minister Arun Jaitley said projects in defence, rural electrification, rural housing and industrial corridors would not need to seek the consent of 80 per cent of the affected landowners as mandated.

They will also be exempt from holding a social impact study involving public hearings – procedures that industry executives say can drag out the acquisition process for years.

Compensation to landholders, however, will stay at four times the market price.

Emergency measure

An ordinance is an emergency measure that has to be passed by the next parliamentary session. Mr Modi has already resorted to using it three times in his six months in office due to a lack of majority in the upper house.

After the last parliament session ended in a legislative logjam on December 23rd, Mr Modi passed two orders to let foreign firms raise their stakes in insurance ventures and allow commercial mining of coal.

Parliament, which reconvenes in February, did not ratify the November ordinance on coal, forcing Mr Modi to pass another ordinance to let the government auction coal mines and allow private companies to mine and sell the fuel. “Governments must act with determination. The government must have the desire to implement its decisions,” said Mr Jaitley, responding to opposition parties’ criticism that such ordinances undermine the parliamentary system in a democracy. – Reuters