The Hindu : Sale of land allowed in Russia

Online edition of India's National Newspaper
Thursday, Jun 27, 2002

International

International

Sale of land allowed in Russia

By Vladimir Radyuhin

MOSCOW JUNE 26. The Russian Parliament has legalised the sale of land in Russia, dismantling the last pillar on which the Soviet socialist system rested for nearly a century.

The Lower House, the State Duma, on Wednesday approved a bill, by 258 votes to 149, with five abstentions, allowing private ownership of agricultural land, but banning foreigners from buying it.

The law has still to be voted on in the Upper House, the Federation Council, where it is expected to win an easy endorsement, and then signed by the Russian President, Vladimir Putin, who has strongly backed the Bill.

Public ownership of land and industrial assets had been a cornerstone of socialism built in the erstwhile Soviet Union in the wake of the 1917 Bolshevik revolution.

The sell off of industry began shortly after the collapse of the Soviet Union in December 1991, but it took another 10 years to allow the sale of farmland.

Most Russian agricultural land is still controlled by collective farms, though on paper at least it has been divided among individual farmers in keeping with the 1993 Constitution, which allowed private ownership of land.

However, until now the farmers could neither sell nor mortgage their plots of land, which hampered market reforms in agriculture.

The bill allowing the sale of land had long been blocked by Communists, but they lost control of the State Duma during the last parliamentary elections in 1999. Communist MPs said they now hoped to collect 10 million signatures to hold a national referendum on whether to allow sale of land.

Under the new law, foreigners can lease land for 49 years, but are banned from buying it.

Experts said the ban may be lifted after agricultural land has been properly evaluated and pricing mechanisms are put in place.

``Russian land is too cheap to let rich foreign buyers onto the free market,'' said Mr. Alexander Chetverikov, a State Duma deputy with the Russia's Regions faction.

"All Russian farmland can be bought up today for about $1.5 billion in keeping with current prices, whereas the Russian government values it at $80-$1000 trillion.''

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