Economic Impact of Prohibition of Sale of Land Owned by Scheduled Tribes to Non- Scheduled Tribes in India

Abstract

The West Bengal Land Reforms Act-1955 imposed a restriction on sale of land owned by a Scheduled Tribe to a non- Scheduled Tribe person. Not only West Bengal, but most of the Indian states (which have Scheduled area) imposed this type of restriction to protect the Rights of Land to the Scheduled Tribes as well as from unwanted and distress sale of land by the Scheduled Tribes. This paper tries to explore the economic impact of this restriction theoretically. This restriction divides the entire land market into two segments. One segment is for Scheduled Tribes and another segment is for non-Scheduled Tribes. Imposition of this restriction makes the Scheduled Tribes land owner a lame duck. Non-Scheduled Tribes land owner also loses from this restriction. Only difference is that the extent of per unit loss is higher for Scheduled Tribes land owner. In this act a discretionary power is given to the land Revenue Officer regarding permission to sale a piece of land to a non- Scheduled Tribes by the Scheduled Tribes. That opens up the broad avenue of corruption. The Land Revenue Officer may take a bribe for granting permission to sale a piece of land owned by a Scheduled Tribe to a non- Scheduled Tribe. In that case the policy originates a source of corruption with/without prohibiting unwanted and distress sale of land of Scheduled Tribes land owner. The policy makes land acquisition more difficult and retarding economic development of the country by slowing down industrialisation, urbanisation etc.