Current land prices are highly distorted owing largely to regulatory constraints and the process of compulsory acquisition. This paper brings out the core elements of the reform - the need to define "public purpose" ex ante for compulsory acquisition of land, the measures that would allow the market price of land to play its correct role, and the approach to valuation. It also argues for an independent valuer when compulsory taking is involved and methods of valuation to ensure that the landowner, including the farmer, gets the correct value for his land in both compulsory acquisition and in voluntary sale. There is a need for a parallel non-compulsory framework for acquisition and for developing key elements of the same.
