with love to indore

Sunday, February 14, 2010

Co operative societies land scam in Indore

a few weeks back one could see and hear Queen mother and prince charming patting themselves on back by claiming that India was saved from financial tsunami because old queen mother had nationalized the banks.A hilarious and absurd argument but socialist or crony capitalist policies of those days still linger on and they have caused incalculable damage to us as a society. The damage is not only in terms of growth figures missed or poverty sustained but also in opportunities denied to people and more severely rules framed in such a way that they made thieves out of people .In nutshell rupturing moral fabric of nation.

Two such issues are liquor shops in indore and land scams.

Let us deal issue of land scams in indore.

now there is one newspaper which claims to have started the movement and exposed various co operative societies. though the claim is doubtful, contribution must be recognized.

then there is government which claims to have amended the law, transferring errant officials and so on... but this version is full of holes..
1. the scam is not in a handful of societies but only a handful are free of scams. so obviously officials had full knowledge. no one has been prosecuted though.
2. almost on daily basis name of politicians ,both past and present, from ruling as well as opposition party keep on cropping in papers.One can see that none of the elected representative or opposition has really made it an issue. as they say in hindi ' chour chour mousare bhai'

But keeping politics aside, if one gets honest police or administration or if all guilty are punished is the problem solved?? I am afraid not.

In heydays of socialism Indian society got afflicted with two very fatal virus. one of seeing poverty as virtue and wealth as crime, and secondly controlling mindset of government and domination of government by people who thought themselves to be wiser than anyone else on earth.


1. land ceiling acts - effectively putting end to integrated township development by private parties

2. various government housing boards executed shoddy projects. In quantitative terms their schemes were too few and too late.

3. no effective planning to tackle demand of housing in cities with rising population. result - slums and unauthorized colonies as land was never freed fast enough to meet the demand.

now a new market distorting mechanism was introduced in name of cooperative societies. so collect 'n' number of people , form a society and you could get land at cheaper rate than market. in fact land which individuals can not get , these 'cooperative' societies can get.

now if same good is sold at different prices in market, there is arbitrage opportunity and clever people saw it and rushed to form all sort of real or bogus societies to corner any land that was available.

rule maker and implementer for this arbitrage trade was cooperative department, IDA, district administration and they also benefited

another component of transaction cost was pound of flesh of politicians and police.

and so we have all sorts of people forming all sorts of cooperative societies - some times in hope of getting land, sometimes in hope of getting cheap land and sometimes in hope of getting land and making money by selling it.

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