The government on Monday defended its proposed land acquisition bill as well as the biggest-ever tax demand in which nearly 100 foreign funds have been asked to cough up an estimated $6 billion for Minimum Alternate Tax (MAT) on capital gains made by foreign institutional investors (FIIs) in Indian markets over the past years.

Prime Minister Narendra Modi said tribal and forest land do not come under the ambit of his government's proposed land acquisition legislation and are protected by separate laws.

"The tribals and their land do not come under the ambit of the land bill. Still, people who lack knowledge run this [campaign] 24 hours. They do not know," Modi said.

He accused the opposition parties of misleading people on the issue.

"For you it must be a small issue, a matter of your political principles, but do realise how much it is hurting the country," he said at a conference of state environment and forest ministers.

The land bill, which cleared the Lok Sabha with nine official amendments, faces a tough task in the Rajya Sabha. An ordinance on land, which was to lapse on April 5, was re-promulgated last week since it could not be converted into an act by Parliament in the ongoing budget session. The BJP has asked its MPs and senior leaders to explain to the people the benefits of amending the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act brought by the previous UPA government.

On the MAT issue, finance minister Arun Jaitley said at CII's annual general meeting: "Taxes which are payable must be paid. India is not so vulnerable that every legitimate tax demand is considered as tax terrorism ... we are not a tax haven and we don't intend to be one."

In his last budget speech, Jaitley had proposed to scrap MAT on capital gains made by FIIs.

"Taxes which are not payable must not be paid. They should be challenged... but taxes which are payable must be paid," he said.

Stating that some decisions of the past have made the taxation regime adversarial, he said: "An emerging economy that expects investment cannot indulge in what has been referred to as tax terrorism or very aggressive tax laws."

Referring to tax demand notices on FIIs, he said: "Our fairness has been partly misunderstood. The converse of tax terrorism is not a tax haven. If I read the front-page of some newspapers, it is the impression that I get."

Revenue secretary Shaktikanta Das said some foreign portfolio investors and FIIs had gone to the Authority of Advance Ruling (AAR), which ruled that MAT was applicable. "Naturally the income tax assessing officers have raised the demand," Das said.

MODI LAUNCHES NATIONAL AIR QUALITY INDEX

Prime Minister Modi on Monday hit out at the developed countries for questioning India's intent in curbing environmental pollution.

Modi, who was addressing a conference of state environment ministers and officials, launched the national Air Quality Index (AQI) to monitor pollution levels in 10 cities: Delhi, Agra, Kanpur, Lucknow, Varanasi, Faridabad, Ahmedabad, Chennai, Bangalore, and Hyderabad. It will inform the public about air quality in an easily understandable format. The ministry said that each of these cities will have sixseven continuous monitoring stations with AQI display boards. The AQI has been developed by the Central Pollution Control Board in consultation with IITKanpur and an expert group comprising medical and air-quality professionals.

"See the irony," Modi said. "The world gives lecture on climate but if we tell them that we want to move forward in nuclear energy as it is a good path for environment protection and when we ask them to provide necessary fuel for nuclear energy, they refuse." He said India was being wrongly projected as an obstacle to fighting climate change.

"We have grown up in a culture where nature is worshipped like God," Modi said. "But due to some reasons, maybe we have been ruled by others for centuries, we are inhibited in expressing our point of view. Till the time we gain confidence in ourselves, we will not be able deal with the problem." – PTI