Farmer protests force Gujarat to switch to market-value for transmission projects

Facing mounting protests from farmers over land used for electricity transmission infrastructure, the Gujarat government on Friday overhauled its compensation policy by linking payouts for land occupied by transmission towers and power lines to the prevailing market value instead of government-notified benchmark rates.

Until now, compensation was calculated at 200 per cent of the “Jantri” value—the Gujarat government’s notified minimum valuation of land used for property registration and stamp duty purposes—which farmers argued was significantly lower than actual market prices in many parts of the state.

Under the revised policy, compensation for land occupied by transmission towers will instead be calculated at 200 per cent of the prevailing market value, a move expected to substantially increase payouts in several districts.

The decision comes after months of protests by farmers in districts including Banaskantha, Patan, Mehsana, Sabarkantha, Aravalli and parts of Saurashtra, where landowners opposed the erection of high-voltage transmission towers, alleging inadequate compensation and damage to agricultural land.

In a significant relief for farmers, the state has extended the revised compensation policy to ongoing transmission projects where compensation was assessed under the earlier framework but the projects are still under execution, allowing eligible landowners to avail of the enhanced compensation.

The government has also expanded the area eligible for compensation. Earlier, payments were restricted to the actual footprint of the tower foundation. Going forward, an additional one metre on each side of the tower base will be included while calculating the compensable area.

For instance, for a 765-kV transmission tower, the eligible area will increase from 625 square metres to 729 square metres.

Another major change is the payment mechanism. Instead of disbursing compensation in three stages—40 per cent during foundation work, 40 per cent during tower erection and the remaining 20 per cent after stringing of transmission lines—the government will now pay the entire compensation upfront before work begins.

To determine land values, the state will constitute a Market Rate Committee (MRC) comprising the district collector, representatives of affected farmers, authorised valuers nominated by landowners and representatives of transmission companies.

The committee will determine the prevailing market value of land in a transparent manner. For the Right of Way (RoW) corridor under transmission lines, compensation will also be linked to the market value determined by the MRC.

Farmers will receive compensation equivalent to 30% of the market value in rural areas, 45 per cent in municipal areas and 60% in metropolitan areas, replacing the earlier Jantri-linked formula.

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